A California utilities clause should list every service and say who holds the account and who pays. Two state rules shape it: if the landlord knows a tenant's gas or electric meter also serves an area outside the unit, the landlord must disclose that and make a written agreement or arrangement on payment (Civil Code § 1940.9), and since January 1, 2026 a tenant must be allowed to opt out of paying for a third-party internet subscription offered with the tenancy (Civil Code § 1942.8). Whoever pays, a landlord may not willfully cut off a utility with intent to make a tenant leave (Civil Code § 789.3).

The short version

  • Name each utility and assign it: tenant's account, owner's account billed back, or included in rent.
  • Shared gas or electric meter serving an outside area: disclose before the tenancy (or on discovery) and sign a written payment agreement or make another written arrangement (§ 1940.9).
  • Master-metered gas or electricity in an apartment building or similar complex must be billed to each user at the utility's own rate, with an itemized bill (Public Utilities Code § 739.5).
  • For tenancies commenced, renewed or continuing month to month on or after January 1, 2026, the tenant may opt out of a bulk internet, cellular or satellite subscription (§ 1942.8).
  • Interrupting any utility with intent to end the tenant's occupancy is prohibited, whether or not the landlord controls the service (§ 789.3).
  • Paying for a utility is a separate question from maintaining the facilities: plumbing, gas, hot and cold water, heating and electrical lighting are on the landlord's habitability list (Civil Code § 1941.1).

What the clause should cover

ItemWhat to includeWhy
Service listElectricity, gas, water, sewer, trash, internet, and any others, each on its own lineLeaves no service unassigned
Account holderWhose name each account is inPrevents gaps when the tenancy starts or ends
Who paysTenant directly, owner, or owner billed back to tenantThe core of the clause
Bill-back methodHow and when a billed-back charge is calculated and dueAvoids disputes over amounts
Start and end datesWhen the tenant must open and close accountsMatches move-in and move-out
Shared meterThe written disclosure and agreement, if a meter serves an outside area§ 1940.9
InternetWhether a bulk subscription is offered and how to opt out§ 1942.8
Trash receptaclesWho handles bins and pickupGarbage receptacles are on the § 1941.1 habitability list
OutagesHow to report a service problem and who to callFaster repairs and a written record

Shared and master meters

Shared meters: Civil Code § 1940.9

This rule applies when the landlord does not provide separate gas and electric meters for each unit and knows that service through the tenant's meter serves an area outside the tenant's unit. For example, a house and a second unit may share one meter. Before the tenancy begins, or on discovering the condition, the landlord must explicitly disclose it and do one of two things:

  1. sign a mutual written agreement for the tenant to pay for the outside-area service, or
  2. make other arrangements, mutually agreed in writing, such as the landlord becoming the customer of record for that meter, or separately metering the outside area and becoming its customer of record.

If the landlord does not comply, a court may order remedies including making the landlord the customer of record and reimbursing the tenant's payments for the outside-area service from the date the duty arose (§ 1940.9(b)). The section covers gas and electric only; it does not address water. It is also one of the disclosures listed on the required lease disclosures page.

Master-metered gas and electricity: PUC § 739.5

When a master-meter customer provides gas or electricity to tenants of an apartment building or similar residential complex, it must charge each user at the same rate the user would pay if served directly by the utility. It must give each user an itemized bill generally in the utility's residential format, with opening and closing meter readings and rates and quantities, and post the current rate schedule or the utility's web address for it. The master-meter customer maintains the submeter equipment beyond the master meter.

Water

Water submetering and water bill-backs have their own statutes, which are not covered on this page. If you bill water back to tenants, have counsel review the method before you write it into the lease.

Internet and bulk billing: Civil Code § 1942.8

For any residential tenancy commenced, renewed, or continuing month to month on or after January 1, 2026, the landlord must allow the tenant to opt out of paying for any subscription from a third-party internet service provider, such as a bulk-billing arrangement, for wired internet, cellular or satellite service offered with the tenancy. A landlord may still offer bulk billing. If the landlord does not allow the opt-out, the tenant may deduct the subscription cost from rent, and retaliation is prohibited (§ 1942.8(b) to (d)). The clause should describe the service, the charge, and how a tenant opts out.

No shutoffs to force a move-out

Under § 789.3(a), a landlord may not, with intent to terminate the tenant's occupancy, willfully cause the interruption or termination of any utility service furnished to the tenant, including water, heat, light, electricity, gas and telephone, whether or not the landlord controls the service. Damages include actual damages plus up to $100 for each day of violation, and no less than $250 for each separate cause of action, with attorney's fees to the prevailing party. A landlord also may not decrease services in retaliation for a tenant exercising legal rights (Civil Code § 1942.5). The full rules are on the retaliation, harassment and lockouts page.

If a tenant falls behind on an owner-paid utility charge, treat it as a lease issue handled in writing, not by cutting service.

Setting up utilities, step by step

  1. List every service the property uses, including any the owner pays for common areas.
  2. Check the meters. Confirm whether each gas and electric meter serves only the tenant's unit. If not, prepare the § 1940.9 disclosure and written agreement before signing.
  3. Decide who pays each service and write it into the clause.
  4. Record meter readings on move-in day, with dated photos, and include them in the move-in checklist.
  5. Set account transfer dates. The tenant opens accounts in their name effective the move-in date; the owner keeps service on until then.
  6. Explain the internet options, including the opt-out if a bulk subscription is offered.
  7. At move-out, record final readings and confirm accounts are closed or transferred.

Clause mistakes to avoid

  • Leaving a service off the list, so no one is responsible for it.
  • Billing a tenant for a shared meter without the § 1940.9 disclosure and written agreement.
  • Requiring a bulk internet subscription with no opt-out.
  • Stating a right to shut off service for nonpayment.
  • Writing the clause as if the tenant's payment of a utility shifts the landlord's § 1941.1 duties for the systems that deliver it; a waiver of those rights is void except as Civil Code § 1942.1 allows. See habitability and repairs.

For owners

Walk the property before listing it and trace each meter. A clear utilities clause, matched by move-in readings, prevents most billing disputes. If the home is in an HOA, find out which services the association provides so the clause does not assign them to the tenant. The repairs and maintenance clause covers who fixes the systems that deliver these services.

For renters

Before signing, ask which accounts you need to open and what typical bills look like. If your meter seems to cover lights or equipment outside your unit, ask about it in writing. If you are offered a bulk internet plan you do not want, you may opt out under § 1942.8. If a utility is cut off, contact the provider and the landlord in writing right away. Our guide to the first 30 days in a Coronado rental has a move-in checklist.

Local rules

Some cities add rules on top of state law, such as local just-cause, relocation or rental registration ordinances, so check your city's code. Coronado has no local rent-control or just-cause ordinance as of October 2026 (based on a review of its code's contents).

Frequently asked questions

Who pays utilities in a California rental?

The lease decides, so it should list each service and say who holds the account and who pays. Two state rules limit the choices: shared gas or electric meters need a disclosure and written agreement under Civil Code § 1940.9, and tenants may opt out of bulk internet under § 1942.8.

Can a landlord make a tenant pay for a shared meter?

Only after explicitly disclosing that the tenant's gas or electric meter serves an area outside the unit and signing a mutual written agreement for the tenant to pay, or making another written arrangement such as the landlord becoming customer of record (§ 1940.9). Without that, a court may order reimbursement.

Can a landlord shut off utilities for nonpayment?

No, not to make the tenant leave. Civil Code § 789.3 prohibits willfully interrupting any utility service with intent to terminate occupancy, whether or not the landlord controls the service, with damages of up to $100 per day and at least $250 per cause of action.

Do tenants have to pay for bulk internet in California?

Not since January 1, 2026, for tenancies commenced, renewed or continuing month to month on or after that date. Civil Code § 1942.8 requires the landlord to allow the tenant to opt out of paying for a third-party internet, cellular or satellite subscription offered with the tenancy.

Can a landlord bill tenants for water?

Many leases bill water back to tenants, but water submetering has its own statutes that are not covered here. Before adding a water bill-back to a lease, have counsel review the method. The § 1940.9 shared-meter rule covers gas and electric only.

This is general information, not legal advice. Laws change; confirm the current text and your situation with a California attorney.

McKee Properties manages rentals from its Coronado office; contact us with questions about your property.

Sources

Verified October 19, 2026.

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