How are charges calculated ?
Electricity:
The estate buys electricity as a commercial user but has an agreed 5% VAT as end users are domestic. Although all properties have their own meters, the company pays according to the reading on one master meter at the electricity substation. This meter carries the total amount of all the individual meters and some extra for the usage in the water and sewage treatment plants. PPEML has to pay this amount in full then recoup the cost from owners based on their own meter readings.
As well as a daily charge and unit charge, PPEML have to pay additional capacity charge, metering charge and a climate change levy.
PPEML is a reseller, not a supplier and is not permitted to increase the amounts they pay themselves, everything is charged to owners 'at cost'.
Unit charges as measured at meters in properties are passed on unchanged,
The other charges are added together and divided equally between owners.
PPEML has to pay the supplier when invoiced, this is why we ask for prompt meter readings and payment of bills. PPEML still has to pay when owners are late with readings and payment and this impacts the ability to finanace other works on the estate.
Service Charge (site fees)
Prior to PPEML running the estate it was in a terrible condition with intermittent and contaminated water supply, a road so bad that couriers refused to deliver, untreated sewage discharging down the hillside and had six charges against it for breaches of health and safety regulations. Much of that is now fixed but there are still some outstanding works to be finished.
The service charge is calculated by looking at the predicted costs of works over the next year and the known charges for consumables, loan repayments, licenses, insurance and the inevitable tax that the company has to pay. Exact figures are difficult to produce because of varying inflation and as yet unknown quotes from contactors for known and emergency works so PPEML try to use 'worst case' estimates to be confident enough money is available to pay costs. It isn't an exact science but the objective is to charge owners enough, and only just enough, to be sure the company doesn't go into the red.
Examples -
The sewage treatment plant is in perilous condition and is uneconomical to repair, a new one will cost between £250,000 and £300,000. That's more than £2,500 per property.
Almost half the estate is fed through a 50 year old and badly corroded electricity cable. All the similar cables on the estate have already burned out and had to be replaced. In places, live wires are now exposed and present a very clear danger if touched. Replacing the cable requires a 35m long trench to be dug and new cables and switchgear installed. Costs are more then £25,000.
