The true cost of municipal estimations: Why property owners must take control

Estimated meter readings can result in billing amounts that don't reflect real usage. This creates uncertainty for owners and portfolio managers and often inflates the reported costs of running a building. It can even place a user into a higher tariff rating category, compounding overpaying for your municipal utilities.

Last year, we reviewed many client's municipal statements. Many of these were incorrect estimates and led to overbilling that had to be corrected manually.

What's happening with the City of Cape Town?

If you don't submit your meter reading by the deadline, the City's system uses an estimate based on past usage. This might work in theory, but in practice it ignores seasonal changes, tenant turnover, vacancy shifts or energy efficiency upgrades.

For example, after a property installed solar and switched to LED lighting, estimated bills still matched pre-upgrade levels. That property was charged 22% more than it should have been for two billing cycles.

Why this matters for your property finances:

• It affects your monthly cash flow
• It changes your expense ratio, especially if you are managing multiple units
• It creates audit issues for trustees or financial reviewers
• It delays refunds or corrections if not picked up quickly

We also see knock-on effects for tenant billing and levy calculations, which can lead to disputes.

What you can do now:

1. Log readings monthly using the City's e-Services portal: https://eservices1.capetown.gov.za
2. Check your bill totals against your property's expected consumption
3. Request a statement correction if there is a difference between your actual reading and the estimate used

Municipal billing doesn't always reflect what's happening on the ground. Owners who take a proactive approach avoid months of back-and-forth or inaccurate reporting.

If you are managing a portfolio or acting as a trustee, make this part of your monthly checklist.