“electricity tariffs are rising by an effective 14% this year”
Sectional Title schemes and other community housing developments should be taking steps as fast as they can now to ensure that residents have access to electricity and water supplies in the coming months.
These steps could include the installation of generators, solar power systems (PV panels), solar water heaters or heat pumps, rainwater collection tanks and pumps, and even the drilling of boreholes.
So says Andrew Schaefer, MD of national property management company Trafalgar, who notes that in the face of the unresolved coal supply and mechanical problems at Eskom power stations, it is likely that SA will continue to be plagued by periods of load-shedding, especially during the high-demand winter season.
“What is more, electricity tariffs are rising by an effective 14% this year and are set to keep rising, which makes alternative power supply systems such as wind or solar attractive even without the prospect of load-shedding.”
Meanwhile, he says, many areas even in the big metros are struggling to maintain a constant water supply due to drought or poorly maintained infrastructure, and water restrictions, throttling and long interruptions are becoming increasingly common.
“Many owners of freehold suburban homes have acted fast in the face of these problems and are already actively ‘going green’ as they try to become less dependent on municipal electricity and power supplies. Many large companies are also installing their own alternative power plants and water supply systems, and we believe that owners in Sectional Title (ST) schemes, estates and cluster villages should be following suit as rapidly as possible.
“Of course there are costs involved, but ST owners need to consider that these measures will not only shield them and/or their tenants from the consequences of load-shedding and water outages, but will also:
- deliver substantial savings on the cost of electricity and water supplied by the municipality while helping to protect the environment;
- enhance the value of their properties; and
- make their schemes and individual homes highly attractive to prospective buyers or tenants in the future.
However, says Schaefer, ST trustees and Home Owners’ Association directors do need to make very sure that they follow the correct procedures before deciding on any ‘green’ improvements to their schemes such as a communal solar power system.
In terms of the Sectional Title Schemes Management Act (STSMA), for example, ST trustees must notify owners of any proposed “necessary” improvement to the common property and give them 30 days to object or call a meeting. If there are objections or a meeting is called, a special resolution will have to be passed before they can proceed. (This requires a normal meeting quorum and a vote in favour from 75% of those present in both number and value.)
“Then there is also the question of how to finance such improvements. It is certainly possible for the body corporate of an ST scheme to obtain a loan to fund the ‘green’ improvements and to pay this back out of quantified savings but once again, this will need to be approved by special resolution.
“To simplify matters and help trustees move their plan forward quickly and in the most cost-efficient manner, we recommend that they should always consult a reputable and knowledgeable property management company like Trafalgar. We already have the solutions for this type of situation, derived from our experience in managing over 1300 ST schemes and estates around the country.”
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