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As most of you know, I left my full-time job to travel in March of this year.   The freedom has been great, but there is still anxiety of taking care of my house while I’m gone. I wrote about some actions that I do, but I’m still fairly limited to what I can do from abroad.

One of my biggest concerns is the electric bill. I have electric heat and for those that are unaware, the electric bill is highly dependent on how much the heat is turned on. In the spring and fall months, I really bank on the fact that the heat is under-utilized to compensate for the use in the winter time.

The two roommates who I had for the past year are fantastic at minimizing their heat use.  On the other hand, the roommate that replaced me in the basement has been using the heat on and off since September, which is something I never used to do when I lived in the basement. Now granted he’s in the basement and it’s a bit cooler, but it doesn’t mean that the heat needs to be turned up to 70 degrees when the outside ambient temperature and room temperature is 65 to 68 degrees. I strongly feel that the heat shouldn’t be turned on.  I don’t want to raise the issue of controlling the thermostat and telling he needs to take off his skirt and put a pair of pants on.  , He  He needs to feel comfortable, so I can’t argue much.

Here’s a breakdown of my 2013 electric bill month-by-month.

Electric bill for 2013

Electric bill for 2013

I paid a grand total of $1,671.26 when I was living in the basement. I tend to have an active life style and never really turned on the heat until early to mid December.

Here’s my electric bill for 2014/15 for the months when I moved out to travel and my roommate replaced me in my basement room.

Electric Bill for 2014/2015

Electric Bill for 2014/2015

I expect to pay around $2,992.70 on the electric bill for the year.

Nov, Dec, Jan, and Feb didn’t happen yet. To forecast the electric bill for these months, I looked at the bill for the time period when my roommate replaced myself in the basement, which was from March to Oct. I then compared it to my previous year’s electric bill over the same period. I determined there was an average increase of 70%. I then applied this average increase to the electric bill for Nov, Dec, Jan, and Feb of 2013 to forecast my electric bill for the rest of 2014 and first few months of 2015.

This means, I’ll be spending $1,321.44($2992.70 – $1,671.26) more on the electric bill per year to make an extra $7,200 a year. The $7,200 is computed from the monthly rent I’m collecting  from the roommate($600) in my basement room times 12 months(12x$600).  Despite his usage being higher, I’m still profiting overall, but one can see how it’s directly cutting into my bottom line.  The justification I’m making with the increased bill is I’m still breaking even with the cost of ownership of the house. In other words, I’m not loosing money.

IS IT WORTH AN ARGUMENT?

Additionally, I don’t think arguing about 2 or 4 degree on the thermostat is an argument I want to take on. It’s a small battle. In short, if he’s that cold, he’s cold. I’d like to raise the issue that if he’s cold, he should put on sweat pants and a long sleeve shirt versus turning up the heat as the first measure.  His laziness to acknowledge this is what’s killing me.  Maybe I should bring it up, maybe I shouldn’t, I don’t want to attack his lifestyle, but it’s taking away any padding away from my budget.

The good thing is that this roommate does pay his rent on-time and in full for the past 8 months, so he’s reliable in that sense.

As for my other two roommates, I’m grateful they aren’t so liberal with the heat and to my knowledge have not turned on the heat yet. I can’t imagine if I had three roommates who are heat snobs, my electric bill would be a sore spot.

FIXED RENT VERSUS SPLITTING UTLITIES

This is one of the pit falls of pricing a room for a fixed amount.  I liked the fixed amount because I know how much I’m receiving every month.  Likewise, my roommates will know how much to budget for rent each month.  Additionally, there’s three roommates so had I gone with dividing the utilities, there could be bad sentiment against another roommate for being careless with the the utility usage leading to higher costs for everyone.

Lastly, when I’m not traveling, I’m couch surfing on my own couch because there’s no extra bedrooms.  If my roommates were splitting the utilities amongst the three of them, I certainly would be considered a free loader.  I’m benefitting in that way from the fixed rent price scheme.

For those that have a fixed rent price scheme, is there a utility bill that concerns you like my electric bill?

Do you think it’s worth arguing about?

{ 12 comments }
  • Sherry October 13, 2014, 12:25 pm

    I noticed at our church on Sunday, they had a clear box around the thermostat. They had to go and get a key to unlock it to change the setting. The keyhole was on the underside of the clear box. Maybe you can try something like that.

    Reply
  • Dara October 13, 2014, 1:36 pm

    That’s a tough one. I think you are wise to consider the impact of bill sharing among the tenants as well as the new tenant’s point of view. I wonder if this is one of those live and learn scenarios?

    Reply
  • Stacey October 13, 2014, 6:01 pm

    We charged fixed rent too (and very cheap for our area), and sometimes I didn’t appreciate comments about the thermostat. They wanted it colder at night during the summer. Does each room have a separate thermostat? If not then maybe they are all enjoying the change, but maybe you should discuss it with them and ask if they are willing to share the cost difference to continue doing this. I can feel cold at 70 degrees inside too.

    Reply
  • Laura October 13, 2014, 7:07 pm

    I feel your pain. I, too, use a fixed rent pricing, and recently, the utility co made an error and was under-billing me for several months. so now I’m paying the extra on top of my regular utility bill. My high usage comes in the summer months for cooling here in Texas. My electric bills have been $650 this summer, current month’s bill went down to $570. My usual summer bills are between $450-500. It has shot my income stream (I bring in $440 from one tenant and $500 from another), and I’m trying to be more energy concious to get the bill down into a reasonable level, but my tenants are notorious for leaving every light on in the house. I do use mostly flourescent bulbs, but there are a few ceiling lights I haven’t switched yet. I’ve also raised the thermostat several degrees, but since I was the one that insisted on it being low in the first place, they haven’t complained about that!

    I would ask your basement tenant to help you keep from having to raise the rent by utilizing a small, energy efficient space heater, rather than upping the house thermostat. Make it seem like you are coming to him for advice, rather than being the heavy.

    Reply
  • Sean October 13, 2014, 8:04 pm

    Mike, glad to see you posting again. There are few websites out there that tackle the landlord/roommate topic and have missed the updates. From my point of view you do two things: install a wifi enabled thermostat and then don’t bring up the increased utility bill. I have a wifi thermostat and monitor the temp when I am gone on vacation or business (or even at work at times). There have been several instances I have found the AC on when its 75 outside… I turn it off! If they know you have access to check up on it, you might find they watch it a little bit closer themselves. Second, the fact you are couch surfing when in town sort of cancels out the additional cost you incur in my mind. I assume you are using one of their bathrooms? Point is its one more person to take up the kitchen, living room, bathroom, create even a minor mess, etc. They signed up to be in a house with 3 people and at times there are 4 in it. I have a 3-day-a-month policy for overnight guests for this reason. It may not bother them in reality… but it might me. All the best to you!

    Reply
    • Mike October 13, 2014, 10:09 pm

      Sean, some folks have suggested the wifi enabled thermostat. I’m contemplating whether the $250 is worth the investment. I think just for the peace of mind it might be. Do you have the wifi thermostat installed in all your zones?

      I see your point of view of my presences being a bother when they signed up for a 3 occupancy household. It’s a good point of view that I have not thought about, but I justify my presence as taking care of normal maintenance around the house.

      Thanks for your input

      Reply
  • Sean October 14, 2014, 12:43 am

    If you go on amazon and search “Honeywell RET97E5D1005/U Wi-Fi Programmable Thermostat.” Its $100 and works perfectly. I only have one “house” zone so its not anything complicated. I would recommend having a professional company install it… I tried to do it myself, crossed a couple wires, and blew the transformer on my furnace ($200 mistake that could have been avoided if I hadn’t been stubborn that I could do it myself).

    Reply
  • Fran October 14, 2014, 5:23 pm

    This may seem ridiculous but I have an “excess utility clause” in my rental agreement. It basically states that if there is negligent use of heating, ac, water, lights, etc. that I have the right to increase rent to cover that increased expense. It’s pretty open so I just have an honest conversation with my tenant about it. I am only renting one room in the house though, so that makes our shared living space more equal. I think it is important to communicate how you use your utilities and what your expectations are. Many people desire to be comfortable and feel that quality of life is decreased if they cannot be comfortable in their own home. I, on the other hand, say sweat it out or put on some extra covers. Fortunately my current tenant sees it the same way.

    Reply
  • Ronda October 15, 2014, 11:19 am

    This increase seems like it might be more than a 2-4* as the bill more than doubles in costs. I would verify whether there has been a rate increase with the utility company or is it all in Kilowatt/ Therms used. If this is truly an renter issue it may cancel out any benefit of renting the room. Also consider a lockable cover or controllable thermostat.

    My solution has been to state early on that I keep the thermostat a particular setting. If my renter wants to raise that setting then there would be a 50/50 split on the utility bill (only one renter). I do provide a small A/C, fan, and oil heater for that room, recognizing that it is on the north east corner of the house and gets the least amount of airflow from the furnace. I ask that the appliances are turned off when the room is not occupied.

    Ironically, I have found past renters that have covered the furnace vent with furniture (no air flow) or kept the window open with the fan in front in the middle of winter (trying to hide cigarette smoking by blowing the smoke out the open window) or cranked the A/C in summer so that she could sleep under a quilt rather than opening the window for cool night air. All three renters were asked to leave.

    I see that with the increase in your utility bill there may be more than just the furnace adjustment. Does the renter take long hot showers until the tank is empty? Wash in hot water? Bake every meal in a 400* oven for an hour? Charging every laptop and cell phone in the neighborhood each night? Best wishes.

    Reply
  • Jason October 17, 2014, 12:00 am

    One small point – the hit to your bottom line on this expense is a bit less than what you wrote. Provided the $1,321 is tax deductible, you should be able to save another $260 (approx. assuming a 20% tax bracket)

    Rate
    Expense $1,321
    Revenue $7,200 0.2 $1,440
    Taxable $5,879 0.2 $1,175

    Difference $264.20

    Also, the WiFi thermostat is a great idea. I might incorporate that into my set up. Thanks for that.

    Reply
  • Nikki October 22, 2014, 8:14 am

    Hi Mike.
    We do split utilities in our house for room renters. My husband has a great Google Docs spreadsheet that does the math for him pretty much. Just plug in the numbers. Then that month’s Google Doc is shared with the tenant and shows a breakdown of utilities and their rent. So they see at a glance what the owe for the month. I’m happy to share this with you if you decide to one day go this route.

    Previously, we’ve had a roommate who cranked the AC up a lot…he seemed to wait until we were gone. We even installed a ceiling fan in his room for him. Plus he had so much electronics in his room it was like a server room. The electric bill was really high and we weren’t happy even with it split. We put min and max temp that it can be set to. This seemed to help some although he griped. I personally didn’t care much as he was my least favorite housemate ever lol.

    I like Sherry’s idea of putting a box over the thermostat. But really- perhaps you should just talk to him about it. Not a big deal- just a short conversation. Ask him if he could at least set the temp back down when he’s away from home (if he doesn’t already).

    Reply
  • Tina October 30, 2014, 1:02 pm

    Hi Mike,
    I think good repore with your renters goes a LONG way! Especially while your out traveling. haggling over utility bills is the last thing you want to do with them. I am on a flat rate with my pge company so their are no surprises thru out the year. every 4 mos it is looked at for proper averaging. I charge a flat rental rate for my (3) rooms for rent. The utility bills are baked into the rent, Enough to allow for those hot California summer months that may drive the avg rate up a bit. side note: I just got digital life where I adjust the thermastat and can supervise who goes in/out with camera’s downstairs to view what’s going on in the general area’s of the house as well as secure the premises. (my own peace of mind) This has given me added security when ppl move in/out. they may give over the keys but who is to say copies have not been made? enough jabbering…love to hear everyone’s comments/suggestions, thanks for the site!

    Reply

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