Subject: Master metering wastes electricity in UCLA apartment buildings
Thanks for your message. As I understand our correspondence, no one at UCLA analyzed the economic returns or the environmental consequences of master metering electricity for the 1,384 apartments UCLA recently built in Weyburn Terrace and on Hilgard Avenue. I hope the UCLA administration and the UC Regents’ Committee on Grounds and Buildings will consider the issue of whether and how to meter energy use in future UC housing projects.
Without any analysis of the economic and environmental aspects of master metering, UCLA’s decision not to provide an individual electric meter for each apartment seems to have been based mainly on, as you say, the “value/convenience for our highly recruited graduate student population.” If so, did you ask students what they thought about metering?
I think most highly recruited graduate students know enough about economics and care enough about the environment to understand that master metering for electricity is bad for both students and the environment.
Intelligent graduate students surely understand that the rent for apartments in a master-metered building will be higher than the rent for apartments with individual meters. Because UCLA must increase the rent for apartments in a master-metered building by enough to pay for the “free” electricity, the total cost of electricity in a master-metered building is divided equally among all residents, and it shows up as higher rent.
Students who live in master-metered apartments cannot save money by saving electricity, and students who are conscientious about using electricity subsidize those who waste electricity. In contrast, students who live in an individually-metered apartment can save money by conserving electricity.
Studies have found that bundling “free” electricity into the rent usually increases electricity use by about 25 percent when compared with individual metering. Intelligent graduate students surely understand that they can therefore save money by paying for their own electricity. All else the same, the rent that includes the cost of “free” electricity in a master-metered apartment will be higher than the rent plus the cost of electricity in an individually-metered apartment.
Master metering also has environmental consequences. If it increases electricity use by 25 percent, master metering will increase the resulting air pollution and greenhouse gases produced by generating electricity. In the attached presentation, a graduate student who lives in graduate student housing estimated that individual electric meters at Weyburn Terrace would have reduced UCLA’s greenhouse gas emission by about 1.1 million pounds of CO2 per year.
So I would argue that highly recruited graduate students surely know enough about elementary economics to understand that master metering is bad for students, bad for UCLA, and bad for the environment. I have heard nothing that amounts to a rational argument for master metering.
I understand the temptation to push “highly recruited graduate students” out in front as a shield for bad decisions about master metering. Please see this “highly recruited graduate students” argument made at great length by the Director of UCLA Housing in 2006 (Note: Prof. Shoup attached the 2006 document to the email.) The “highly recruited” argument for master metering made no sense in 2006, and it makes even less sense in 2012. I do not believe that UCLA’s best graduate students are so economically naive or so environmentally irresponsible that they want “free” electricity.
Naturally, I do not expect you to agree with everything I have said about the benefits of charging residents for the energy they use. Nevertheless, I hope UCLA administrators and the UC Regents’ Committee on Grounds and Buildings will consider seriously the possible economic waste and environmental damage done by master metering in new apartment projects. I will be happy to work with you and Nurit Katz and any others on campus or at UCOP who would like to study the issue.
Donald Shoup, Professor
Department of Urban Planning, UCLA
Doesn’t seem to be a difficult concept to understand: