Prepaid electricity puts the power in your hands

WITH the cost of living continually increasing, Durban residents are turning to prepaid electricity meters to help manage their monthly bills. Berea Mail reached out to residential letting agency, Trafalgar Property Management, to find out more about the process and the pros and cons of using prepaid electricity.

Karien Coetzee, national property management consultant for Trafalgar, said the process differs when an entire complex, as opposed to an individual, opts for a prepaid meter. When the whole complex makes the change, there are guidelines to follow. These are laid out in the Sectional Title Schemes Management Act, Act 8 of 2011, in the Prescribed Management Rules that are Annexure 1 to the Act.

According to Prescribed Management Rule 29(4), a body corporate can install separate pre-payment meters on the common property, provided that all members are given at least 60 days’ notice of the proposed resolution, with details on the installation costs and estimated effect on the cost of the services over the next three years.

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“This means that the body corporate (the owners) have to first pass a special resolution before the prepaid meters can be installed in the units. The trustees must decide if they want to pass the special resolution at a meeting or on a round-robin basis. The procedures differ, and Trafalgar can assist the trustees with the process to be followed to obtain the special resolution,” said Coetzee.

Coetzee said an individual owner who installs a prepaid meter in their unit does not typically need the body corporate’s permission.

“They just need to consult with the trustees. In both instances, the choice is there whether the prepaid meters will be installed by an independent vendor or by the local municipality,” said Coetzee.

Weighing the options

Pros
1. Bills don’t pile up
Using a prepaid system means that electricity supply is only replenished as residents top up the meter.

“From a body corporate side, one of the pros to having prepaid meters in the units will be that individuals will be responsible for their own electricity accounts. If they don’t buy electricity, they won’t have electricity. The body corporate will no longer be burdened with having to pay the Council account and battling to recover the electricity charges from the owners,” said Coetzee.

2. Easier to budget
“A definite pro is that each unit is able to accurately measure their electricity consumption and can budget for it. There are no problems with incorrect meter readings or estimate meter readings taken,” said Coetzee.

3. Pay for what you use
A prepaid meter gives residents more control over their bill.
“Sometimes the electricity is charged as part of the levies, so an owner that lives alone in his/her unit will pay the same amount for electricity as the owner next door, even if they have four people in the same size unit,” said Coetzee.

Cons

1. Set-up costs
Coetzee said setting up the system can be costly if there is a lot of rewiring that needs to be done before the installation.

“Vendors normally give the option that meters can be bought or that the meters can be leased. The costs for these will differ. If working through a vendor, then the calculations must be done properly as it could work out to be more expensive to buy electricity. What we have found is that if the prepaid meter is installed through the Municipality, then the costs are normally cheaper, but it takes longer to get it done,” she explained.

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2. Remembering to top up
A possible con is that residents need to remember to buy electricity.
“If you don’t, the meter will run out. Once you get into a routine, and know your monthly consumption, it will be easier, and remember, in winter, we use more electricity than in summer,” said Coetzee.

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