The charges for basic services set by the Bela-Bela Municipality at the beginning of the new fiscal year – July 1, have raised many concerns for the residents.
The Bela-Bela Municipality scrapped the old block tariff system on monthly electricity use and replaced the system where consumers now have to pay a capacity charge (rand per ampere), as well as a rate per electrical unit (kWh).
The Bela-Bela area’s overall electric use is limited by Eskom to 17,700 MVA. If this use is exceeded, Eskom will recover the additional cost from the municipality. The municipality will recover the costs from the consumers, Die Pos reported.
Die Pos is in possession of a document from the National Energy, regulator, who approved the latest prices for the 2016/2017 financial year.
According to Statistics South Africa (SSA) ‘s 2016 census, there is now a total of 21,354 households in the Bela-Bela area, comprising 19,147 typical households, 17 traditional households, and 2,111 informal households exist.
A total of 18,624 of these households according to SSA use electricity.
Die Pos spoke to three real estate agents about the rise in municipal costs.
Anzelle Cloete of Huurnet properties believed there are lots of people who are concerned about the new tariffs and that the charges can become unaffordable.
What was strange is that the approval placed on large apartment complexes will cause a detrimental effect, and people will suffer severely.
Annelie Botha Aida Properties said the extra costs raised questions about what portion tenants should pay and what liability will the owner of property have.
“One wonders how many adjustments have to be made because the owners will hardly get anything out of their original investment and yet they have to find a way to recover the cost. Residential Property is currently not a good investment, “she said.
Businesses or commercial properties that do not generate enough money each month may struggle to survive. Even farmers who have to pay higher rates for electricity will struggle,” she said.
Corne van Rensburg of Century 21 Properties said it was the first time in her 25 years of being in the real estate market that the situation has become so devastating.
She said owners, especially pensioners, will probably not recuperate the costs because rates also are included. In the end, the landlords will have to pay the basic costs because they are the legal owner of the properties.
“Even estate agents in town have been affected by the increases. Many people are struggling to sell their homes and still looking for tenants, “she said.
In most cases where contracts are signed for a property to rent, the lease will only after a year be linked to an increase that is tied to inflation.
All three agents said it would be unfair if owners suddenly wanted a new signed contract covering the increases and passed this onto tenants. So they suggested that tenants and landlords sit around a table and find a workable solution.
The municipality recently announced that residents should downgrade their power meters to a lower amperage in order to reduce their monthly bills. Die Pos was told that the downgrade will be done free of charge, but not upgrades.
The municipality has urged residents to use less power to relieve the pressure placed on the municipality, as well as on the power grid.
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