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Sunshine or Centlec – what’s better?

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Firstly, let’s admit that you will find it very difficult but not impossible to entirely get off the Centlec grid, but it is not impossible.

Solar panels are getting more practical with a higher output and less expensive by the day.

Not having solar power in a country that has a surplus of bright, strong, sunny days is simply not an option.

For sectional title units it is possible to allow installers to put in their own systems free of charge.

The advantage being that they maintain the system and do the installation at no cost to you.

They supply you with electricity at the same rate as Centlec, less a percentage and you will be able to get electricity at around 75 percent of the cost of Centlec power.

While their fees seem to be set to rise by seven percent per annum, Centlec is likely to be anything from 10-25 percent and who knows how long the load shedding periods will be.

Care must be taken that the system that you buy is an offline system, not a grid-tied system.

The reason is that a grid-tied system only works when the power from Centlec is up.

An off-grid system has a battery backup so that when the power is down, the batteries supply the power.

The batteries are charged during the day by the sun.

Depending on the battery size, you can have power for three-12 hours when the sun goes down.

You need to be practical.

Do you really need power all night?

Are you prepared to link to Centlec from say 10 pm to 6 am and pay their charges?

Either way the savings from these systems is a decent 25 percent at the beginning rising every year as the Centlec increase percentage exceeds the solar installation.

Body corporates should realise that there is a tax incentive that these contractors use.

That is a 100 percent rebate on the cost of installation.

This means that if the system costs R1 million, the body corporate only pays an income tax of 38 percent once they have sold electricity exceeding the cost of the installation.

After that, 62 percent of the income goes towards the body corporate income.

Let’s look at it more practically:

If the body corporate borrows R1 million at the bank at  seven percent over five years, then the cost would be in the region of R20 000 per month.

Let’s assume there are 20 units in the complex, that means an average of R1 000 per month repayment per unit.

My feeling is that most units, especially townhouses, would use this amount of electricity anyway.

So, R20 000 x 12 is R240 000 income per annum.

Effectively the system pays for itself from day one.

Next year the electricity from Centlec is likely to go up by 15 percent.

Let’s say the charge for your solar only went up by 10 percent, to R22 000 per month.

But if interest rates don’t rise then your payment of the load is still only R20 000.

You could pay off the extra R2 000 per month.

In effect, it is unlikely that you have to pay tax on your electricity sales until the end of year five, by which time you will have paid off your loan.

At 10 percent increase in electricity in year six you should be collecting R39 000 per month but you won’t have to pay back money to the bank.

You will have to pay 38 percent tax – less the initial R50 000 tax free – on this income which means that the body corporate will receive an after-tax income of R259 000 per annum or R21 600 per unit per annum  or  R1 080 per unit per month.

I would think that this would pay your levy or at least just about all of it.

Sounds good to me.  At least it is worth looking at.

I have solar in my own house. Together with a prepaid meter, I pay around R1 000 per month in winter, down from around R4 500 without the solar.

  • Mike Spencer is the founder and owner of Platinum Global. He is also a professional associated property valuer and consultant with work across the country as well as Eastern Europe and Australia.

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Property

Gas it out, give Eskom the boot

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ALTERNATIVE SOLUTION . . . Gas can be used for heating water, ovens and stoves in general

Electricity has simply become unaffordable. And, as if that’s not enough, it’s not always available.

In recent months, the power utility has been churning out media statements explaining the loss of generation at various power stations and pleading with consumers to use electricity sparingly.

While the updates are important, consumers naturally expect electricity to be available whenever they turn on the switch.

The recent tariff hike of over seven percent in Mangaung Metro has proved quite steep to most households and it might not be far-fetched to expect another round of hikes in the coming months.

I strongly believe it’s now time to seriously consider other practical solutions to end this double inconvenience of high prices and inavailabilty of electricity.

Alternatives like solar and gas could ease the problem quite significantly but it comes at a cost.

In fact, the installation costs might be quite discouraging, but once the systems are in place, there are no major expenses to be incurred – this including solar electricity, solar water heaters and gas.

Electrical geysers chew electricity while solar heaters are effective and efficient.

Natural gas is also a realistic alternative.

The system is cheaper to install by far and gas cylinders normally last for months.

Gas can be used for heating water, ovens and stoves in general.

Larger systems can also have central heating.

Gas is readily available and suppliers have delivery services for 10kg cylinders and above.

And unlike electricity, gas geysers only heat water on demand, which means that you don’t sit around with pre-heated water in your geyser.

It only heats on demand.

And when cooking, pans heat up quickly and, importantly, cool down when the gas is switched off.

It is a different type of heat and is great for making oven bread.

Worth a try!

  • Mike Spencer is the founder and owner of Platinum Global. He is also a professional associated property valuer and consultant with work across the country as well as Eastern Europe and Australia.

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Langenhoven Park chain store robbed

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SHOP ROBBERY . . . The Walk Centre in Langenhoven Park

Bainsvlei police in Bloemfontein have launched a manhunt for suspects involved in business robbery at a chain store at The Walk Centre in Langenhoven Park on Wednesday.

The complainant, who is the manager of the shop, told the police that two men walked into the shop pretending to be customers before robbing the shop.

“Suddenly they pulled out firearms and accosted the four cashiers and instructed them to walk back into the complainant’s office,” police spokesperson Lieutenant Colonel Thabo Covane said in a statement.

“The suspects robbed the shop of different brands of cellular telephones as well as an undisclosed amount of money, and fled the scene in a white Renault Clio with registration number HRT 558 FS,” he added.

Police were called to the scene and they are now investigating a case of business robbery.

Covane said anyone who might have information that could lead to the arrest of the suspects may contact Captain Thapelo Motseki on 082 466 8405 or call the SAPS Crime Stop number: 08600 10111. Alternatively, information can be sent via MySAPS App. – Staff Reporter

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Property

Duets are sectional title too

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A duet unit is by definition a two-unit sectional title scheme. Or at least is supposed to be.

However, I have seen these mini schemes with up to five units. Not sure how they get away with it.

Either way they are still mini sectional title schemes and have to be treated like their big brothers – but they aren’t.

Usually, each owner has their own rates account, own water and electricity account and just does their own thing. But that is where the complications come in.

Some owners have a bond and thus insurance. Some bought cash and forgot.

A body corporate is supposed to have a body corporate policy on all the buildings.

Let’s say that there is a fire in an insured unit but it also results in the building down of an uninsured unit.

And because this is a body corporate and all parties are trustees that are expected to have a body corporate policy, they will be equally negligent.

That means that the owner will have to pay 50 percent — or whatever the Participation Quota (PQ) ratio is — of the uninsured unit owner’s loss.

Would you like to be in that position? I don’t think so.

The same applies to maintenance.

So, if your neighbour thinks that his roof needs to be replaced, you will be liable for that same PQ part of the replacement cost.

The trouble is that nothing will happen while everyone is happy and things are running smoothly, but when there is a major problem, people look for solutions to their financial crisis.

It’s not worth it.

Run your mini scheme properly and contact Community Schemes Ombud Service if your neighbour won’t.

  • Mike Spencer is the founder and owner of Platinum Global. He is also a professional associated property valuer and consultant with work across the country as well as Eastern Europe and Australia.

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