I would like to install a water meter so that the tenant pays for
actual water consumed.

You might need to check the law. There was recently a law passed that
prevents you selling energy on whilst adding a markup. I don't know if this
would apply to your supply of hot water (being part water bill and part
energy bill), or if there are similar laws for water use. Something to look
into. You would probably have to charge cost price and recoup any additional
costs (i.e. boiler maintenance etc.) from the rental price.

Christian.