KEEPING IT SIMPLE
It is worrying to see many of our clients going down the solar/battery backup rabbit hole, with very little to guide them, and ultimately being led by a good salesperson whose only interest is to sell to the scheme a system that will generate the most reward for the salesperson and their company.
Is this an over-exaggeration? I think not. There are some horror stories out there!
Having gone through a complete solar installation process in the scheme where our Somerset West offices are located, and being in the process of going through one in the residential scheme where I live, coupled with the fact that I am an engineer by profession, I would like to share something of what I have learnt along the way.Â
Obviously, each scheme is different, and the rules I mention are aimed at a body corporate which receives a bulk supply from Council/Eskom, but there are some basic rules that apply to all community schemes.
Rule 1 – find yourself a good solar consultant (not contractor). This will cost you around 7 or 8% of your total solar project. It will be the best money you spend on the project and in all likelihood, will save you much more than this cost, because you will be putting in the right equipment in the right place for the right price.
Rule 2 – the solar consultant should size the installation according to your needs, put together a tender document, invite tenders, evaluate the submissions and make a recommendation to the Board regarding the appointment of a contractor.
Rule 3 – use the consultant to oversee the installation, ensuring that there are no shortcuts, that everything is built to spec, and that the electricity output is what it is supposed to be. Thereafter they must sign off on the project before final payment is made to the contractor.
Rule 4 – this is a BIG one! Don’t confuse a solar electricity supply with loadshedding. This is the biggest mistake people make. You install solar to reduce the cost of your electricity supply. More on this below.
Rule 5 – the occupants should get no benefit whatsoever from a solar system! Yes, you read that correctly. It is the owners who pay for a solar system, hence it is the owners who should benefit from such a system. More on this below.
Rule 6 – batteries are installed to provide electricity during loadshedding, at a cost which is cheaper than generator created electricity (batteries can also be used to store excess solar electricity produced during the day, which can then be used at night, but that is beyond the scope of this article)
Rule 7 – a scheme should seldom involve itself in providing electricity to owners during loadshedding. I very carefully used the word seldom here, because there may be instances where it may be appropriate to have a generator/batteries providing electricity to the entire scheme.
Why install solar?
You do NOT install solar to combat loadshedding! Again, you read that correctly. You install solar to generate free electricity. But it’s not really free because there is a large capital cost. So the decision to install solar is actually made very simple.
•   With a solar system of a certain size, we can generate X kWh of electricity at no cost.
•   The same electricity would have cost the scheme Y from Eskom/the municipality.
•   We can receive income of Z for excess electricity produced, by feeding such electricity back to the grid (certain geographical areas only).
•   The capital cost of installation is A.
•   Get an accountant/consultant to tell you which is the cheaper option. It’s an easy calculation.
What about loadshedding?
Loadshedding is counteracted by the installation of a generator and/or battery. This can be done whether or not the scheme has a solar supply of electricity. A generator and/or battery is sized according to the essential electrical needs of the common areas of the scheme.
Why should a Body Corporate not provide electricity to occupants during load shedding?
Let me use an example that is easy to understand. All owners in a residential scheme need hot water from time to time. Instead of every owner having a geyser and generating their own hot water, why does the scheme not have a monster geyser (or something similar) and be the provider of hot water to all owners?
A few reasons :
•   It’s open to excessive use (unless you put in a second water meter for each unit).
•   You would have to size it to cope with peak demand time, making it unnecessarily large.
•   Costs to keep such a large body of water warm would be excessive.
•   Piping distance from the source to the unit would mean it takes too long to get the warm water to the unit.
In short, it is much simpler and much fairer if everyone heats their own water, as and when they need it. A body corporate is not a supplier of hot water, nor should it ever become one.
Why then would a body corporate want to become an electricity supplier to occupants during loadshedding? In the same way that an owner installs a geyser to provider hot water, so too should the owner be responsible for providing electricity to their unit during loadshedding. And if they choose not to, that is entirely their decision. When a body corporate tries to be all things to all people, things get messy!
The cost of battery stored electricity and the cost of generator generated electricity is way higher than the rate at which electricity is charged to occupants. The scheme will incur a loss!
Why should occupants not benefit financially from solar installations?
It is the owners who have the expense of the solar installation, not the occupant. It therefore doesn’t make any sense for the occupant to benefit from cheaper electricity. The cost of electricity for the occupant must remain the same as it was before (the standard municipal supply cost). Sometimes they will be using solar produced electricity and sometimes they will be using municipal supplied electricity. To try and differentiate between the two, or start applying averages, makes absolutely no sense.Â
How will an owner benefit from a solar installation?
Let’s use an example – after a solar installation, each unit on average gets let’s say R 500 in free solar electricity. The occupant still pays R 500 for this, just like they always did. The Body Corporate receives the R 500 from the occupant just like they always did, but there is no expense payable to Eskom/the municipality for this same amount. The electricity sold to the occupant costs the scheme nothing. Let’s also assume that the scheme sells electricity back to the grid at an average of R 100 per unit per month. Because the Body Corporate now has reduced costs and additional income, it can drop the levy by R 600 a unit per month on average. This is a direct benefit to the owner. And because the levies are lower, more people will want to buy into the scheme, pushing up the selling prices of the units!
In summary :
•   Given the current cost of electricity, the installation of a solar system usually makes good economic sense.
•   You should size your solar installation based on total electricity usage.
•   You should size your batteries (if any) based on common property critical usage to get you through load shedding.
•   Use a consultant to size the system and manage the installation process.
•   Keep it simple – don’t try and provide electricity to owners during loadshedding.
•   Where possible, feed excess electricity produced, back to the grid.
•   Occupants must continue to pay what they have always paid.
•   Owners enjoy the benefit of reduced levies and increased property prices.
