As South Africa’s electricity costs continue to rise and load shedding remains a persistent risk, sectional title schemes are under increasing pressure to save costs and keep levies stable. The good news? The solution is so simple that many trustees fail to see the forest for the trees.
Thanks to innovative energy providers and funded solar models, bodies corporate can now switch to alternative energy solutions that offer up to 50% electricity cost savings - with zero upfront cost and contract terms as short as 10 years.
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What is a Power Purchase Agreement?
A Power Purchase Agreement (PPA) is a contract with a solar energy provider that installs, owns, insures, and maintains the solar system on your premises — at no capital cost to the body corporate. Instead of buying the system, the body corporate simply pays for the electricity it consumes, typically at a fixed rate significantly cheaper than Eskom or municipal tariffs.
Benefits of a PPA:
- 30–50% monthly savings on electricity
- Zero capital investment
- Maintenance and insurance covered by the provider
- Protection against tariff hikes
- ESG-friendly and property value boosting
Solar savings can fund maintenance and reduce levies
Rather than pocketing the savings, many bodies corporate use them to:
- Fund large maintenance projects that are otherwise delayed due to cash constraints (e.g., waterproofing, painting, lift repairs);
- Top up reserve funds to ensure CSOS compliance;
- Offset levy increases driven by rising utility and administrative costs.
Legal and approval considerations
Many trustees mistakenly believe they need a special or unanimous resolution to enter into a PPA. In fact, trustees may proceed with a trustee resolution if:
- The agreement does not materially alter common property, and
- It does not impose unreasonable financial obligations on the body corporate.
This misconception leads to delays and missed savings.
Andy Pelser of Mirfin Energy Consulting confirms that trustees can lawfully enter into a PPA if it serves the scheme's best interests.
He recommends:
- Requesting a feasibility study
- Reviewing tariff escalations, exit clauses, and ownership terms
- Ensuring transparency on performance guarantees
Consensual Process for Trustees (per PMR 19)
Pelser describes the ensuing consensual process as follows:
1. Give owners 30 days’ written notice of the trustee resolution.
2. The resolution must explain:
- Why the PPA and any alterations or improvements to common property are considered reasonably necessary;
- Any changes to common property (with drawings)
- The cost and how it will be funded
1. If objections are received, call a special general meeting with 14 days' notice.
2. If quorum is not reached, adjourn the meeting for 7 days.
3. If quorum is still not met, those present constitute a quorum and the meeting proceeds legally (PMR 19(4)).
In summary, the trustees have the authority to enter into a PPA and the process should take no more than 30 to 51 calendar days.
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Take control of your scheme’s future
In an era of rising tariffs and aging infrastructure, funded solar isn’t just green – it’s strategic. With no upfront cost and potential savings of up to 50%, your body corporate can unlock funds to reinvest, ease levy pressures, and build long-term financial resilience.
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