What our Mayor and municipality pays for electricity

Mayor of Newcastle, Afzul Rehman has agreed to let the Newcastle Advertiser publish what he has been paying to keep the lights on for the past few months.

Many complaints were voiced on social media, and theories have surfaced which declare the reason for large bills to be the new municipal ‘super block’. While issuing a statement to the media, Cllr Rehman denied these claims.

“The new municipal offices are being funded from other sources,” he said. “None of the revenue from municipal bills is going towards the funding of the build. And for the record, I will not be moving to the new building. I will be staying where I am. The so called ‘penthouse suite’ will most probably be for the municipal manager,” he laughed.

Last Friday, Cllr Rehman along with members of the media and municipal officials travelled to three different suburbs, so that the he could see for himself if the readings were being taken correctly.

The media discovered that all seemed to be above board. Usage at all three homes spiked considerably during the winter months, while consumption during warmer months was much more moderate.

What has the Mayor been paying for electricity?

Bill dated June 20, Cllr Rehman was billed for 3 975 units at a tariff of 88 cents. This came to an amount of R4 008.57 including VAT. Bill dated July 22, he was billed for 5 191 units at a tariff of 88 cents, to the total amount of R5 234.83 including VAT. Bill dated August 21, 4 739 units were charged at a tariff of 95 cents. This came to a total of R5 132.34 including VAT.

Cllr Rehman’s total for utilities over these three months came to R19 774.93, with a marked increase in the winter months. “I make no secret of the fact that I enjoy using my heaters,” said Cllr Rehman. “On a cold day, I like to come home to a warm house. That is why I do not mind paying for something that I really use.”

During winter it is also noted that across the board, water consumption goes down, while electricity goes up, and vice versa in summer. Those with a keen eye will notice that Cllr Rehman is billed at a single tariff for all units consumed.

The reason for this is that Cllr Rehman has three phase power, which is billed at a business tariff. The tariff increased in August, due to the annual increase for water and electricity consumption tariffs taking effect on August accounts.

What does the municipality pay Eskom for power?

Newcastle Municipality pays Eskom for electricity on a month to month basis, on exactly the same principle residents are billed. A simple example, would be to see all the homes and businesses in Newcastle as one big house.

The municipality owns this house, and must pay Eskom for the electricity used, as residents must pay the municipality. The billing also works on the same time line, where the municipality will be billed in August for the consumption in July.

With this in mind, here is what the municipality has paid Eskom in recent past:

August 2013 – R46 224 095.87. September 2013 – R42 509 231.07. October 2013 – R26 157 306.61.

The same was observed in 2014: June 2014 – R29 637 504.15. July 2014 – R45 030 760.19. August – R52 834 424.49.

According to Cllr Rehman, these figures prove that residents are paying for what they use. So far in 2014, the municipality has paid Eskom a staggering R258 684 828.37.

The average amount per month is roughly R25-million, which almost doubles in winter months. Electricity costs are an ongoing debate in South Africa.

More recently, Eskom cut power to three municipalities in the Free State for not paying their bills, nor coming up with a viable payment plan despite continuous warnings.

This is a situation the Newcastle Municipality wishes to avoid at all costs.