They take your estimated usage based on the previous year history for the property and divide it by 12, and that’s what you pay every month. At the end of the year billing cycle you pay the difference if the usage was more than expected, and they give you a credit if it was less.

Example: your most expensive month of the year is $250 and your cheapest is $20, but the total for the whole year altogether is $1200. You just pay them $100 a month regardless of how much you actually used that month.