Submetering Companies May Now Be Regulated As Public Utilities

A submetering company is an intermediary between a landlord and its tenants for the sale of utility services. Submetering companies buy electricity and resell it to individual tenants using their own metering infrastructure. Under Ohio law, a company that is "engaged in the business of supplying electricity" to Ohio consumers is a public utility subject to regulation by the Public Utilities Commission of Ohio (PUCO). When a landlord provides electricity or other utility services to its tenants, the landlord is not a public utility because the landlord is not in the business of supplying electricity to its tenants. But is the same true of submetering companies?

On April 22, 2026, the Supreme Court of Ohio decided that a submetering company was a public utility in In re Complaint of Ohio Power Co. v. Nationwide Energy Partners, L.L.C. The Court reversed a PUCO decision and held that the company at issue, Nationwide Energy Partners (NEP), provided public utility service to tenants.

Statutory Framework

The case turned on the definition of a "public utility" under R.C. 4905.03(C), which includes: "Every company … when engaged in the business of supplying electricity … for light, heat, or power purposes to consumers within this state."

Background

The case involved NEP, a submetering company. The PUCO previously found that NEP was not a public utility, concluding that the landlord-not the tenant-was the relevant "consumer," and the submetering company operated as an agent of the landlord.

The Court's Decision

The Court rejected the Commission's reasoning and found that the submetering company is a "public utility" under R.C. 4905.03(C). In doing so, the Court emphasized that tenants are "consumers" because they are end-user customers who receive and use electricity. Landlords who resell electricity to their own tenants without using submetering companies as middlemen are also consumers. The Court found that NEP was "supplying electricity" because it was responsible for purchasing electricity and reselling it to tenants. Furthermore, the Court concluded that NEP was not merely an agent of the landlord. The Court also found that this type of business (purchasing electricity for resale) does not fall under any exemption for incidental resale. The litigation now returns to the PUCO for it to decide whether NEP has violated Ohio law by providing utility services to tenants without being certified by the PUCO to do so.

Takeaway

Applying the plain language of R.C. § 4905.03(C), the Court concluded that an entity that purchases and resells electricity to end-use customers may fall within the statutory definition of a public utility. Entities engaged in similar arrangements (such as submetering and resale structures) may wish to evaluate this decision in light of their operations.

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