The Ohio Supreme Court ruled Wednesday that a submetering company that arranged with Columbus landlords to sell electricity to tenants is a public utility that can be regulated.
The decision reversed a Public Utilities Commission of Ohio order that submetering company Nationwide Energy Partners was not a public utility.
Submetering was originally a way for landlords to divide utility charges among tenants. But the court's opinion said that submetering has become a big business for third-party companies to buy services from utilities to resell.
Many tenants have complained about higher costs because of submetering.
In this case, Nationwide Energy Partners contracted in 2020 with landlords of five large apartment complexes in the Columbus area for the right to supply electrical service to their tenants.
Tenants had been buying power from AEP Ohio.
Nationwide Energy Partners asked AEP Ohio to alter electric meters to allow the submetering company to supply electricity.
AEP Ohio denied the requests. It then filed a complaint with the PUCO, claiming that the submetering company was unlawfully operating as a public utility, and therefore violating state law.
Writing for the majority, Justice R. Patrick DeWine explained that Nationwide Energy Partners is in the business of supplying electricity, so it's a public utility.
Nationwide Energy Partners also disconnects tenants who fail to pay their bills and it offers payment plans for tenants.
“From the tenant’s perspective, NEP is for all practical purposes the supplier of their electricity,” the court said.
Columbus City Councilmember Christopher Wyche said in a statement Wednesday that the court''s decision was a win for consumers.
"For years, residents have complained about inflated utility bills with no access to regulatory safeguards," said Wyche, who chairs City Council's Public Utilities and Sustainability Committee. "That is why Columbus City Council passed our regulatory ordinance in December. Now, these utility middlemen will no longer be shielded from PUCO enforcement of low-income payment plans, disconnect moratoriums and billing protections.”
Under the Columbus ordinance, submetering companies were given until December 2026 to comply with billing transparency and consumer protection measures.
DeWine, along with Chief Justice Sharon Kennedy and Justices Daniel Hawkins and Megan Shanahan, joined Justice DeWine’s opinion. Eighth District Court of Appeals Judge Mary Boyle, sitting for Justice Joseph Deters, also joined the opinion.
Justice Jennifer Brunner concurred in judgment only.