Working with a tenant in Newark who's paying utilities through their lease. Landlord is charging $0.13/kWh but I'm seeing PSE&G's commercial rate at $0.095/kWh on schedule CGS-TOU. Lease says "actual utility costs plus 10% administrative fee" but the math doesn't add up. Anyone dealt with PSE&G pass-throughs before?
PSE&G pass-through charges in NJ office lease - tenant getting ripped off?
Tony - check the demand charges too. PSE&G has some hefty demand rates on CGS-TOU, especially during summer peak. Also look for power factor penalties. I've seen landlords in Phoenix bundle those into the kWh rate without explanation.
Had similar case in Richmond with Dominion Energy. Tenant was getting charged $0.14/kWh when actual rate was $0.087/kWh. Turned out landlord was including common area lighting and HVAC costs in the tenant's "proportional share." Check the lease language carefully - some allow this under "operating expenses."
Good catch Phil. Lease does mention "proportional share of building utilities." Problem is they're not providing any breakdown or documentation. Just a monthly bill for $2,847 with no backup. Tenant has 4,200 sq ft of a 18,000 sq ft building.
Get the actual PSE&G bills from the landlord. NJ law requires disclosure of utility billing methodology in commercial leases over certain square footage. Also request the building's master meter readings vs sub-meter readings if they exist.
Lease pass-through disputes often come down to documentation and proportionality. The 10% admin fee is reasonable, but tenants shouldn't subsidize other spaces. Demand copies of actual utility bills and reconcile the math. Most landlords will cooperate once they know you're reviewing the calculations properly.