High chiller fees freezing us out of our homes, say RAK residents

Al Hamra Real Estate (AHRE), which oversees 2,500 residential flats and 1,000 villas and townhouses in Al Hamra Village, has been in dispute with residents and owners since last year.

Al Hamra Village developers in Ras Al Khaimah have been in dispute with residents and owners since last year when high bills were calculated on electricity consumption. Sarah Dea / The National

RAS AL KHAIMAH // Residents and owners locked in a year-long dispute with a developer over high chiller fees have complained of bills of thousand of dirhams.

Al Hamra Real Estate, which oversees 2,500 residential flats and 1,000 villas and townhouses in Al Hamra Village, has been in dispute with residents and owners since last year, when high bills were calculated on electricity consumption.

This system was phased out from last November and bills are now charged based on BTU meter consumption. However, fees have remained high.

One property owner and manager from the UK, who did not want to give her name, recently vacated four Marina Apartments.

"Now it's getting a bit warmer, the bills were just getting astronomical," she said. "We were paying more in chiller costs than we were collecting in rent. Even owners can't afford to live here anymore."

Chiller fees can even fluctuate for identical properties. The chiller fees for one of her studios costs Dh100. At another studio, the fee was several hundred.

"Same size apartment, rented out for the same length of time," she said.

"Why the bills are so high for one and so low from another? I don't know."

"What we're trying to do is just ask for a reasonable rate," said a Marina apartment tenant. "Let us pay a few hundred a month for chillers, not thousands and thousands. It's ending up that it's costing some people as much as the rent."

The Marina tenant was billed more than Dh1,000 in chiller fees for a three-bedroom flat occupied for 10 days in December. "That scared the heck out of me. I'm thinking, what will it cost me for 30 days in summer?"

Fees are calculated by dividing the total cost of the building chiller fees by flat consumption. A fixed rate of 30 per cent is subtracted from the total building chiller cost to cover fees for common areas.

"We would like to clarify that we are recovering the cost of electricity to run the chillers from the users as the air conditioning is centralised," said an Al Hamra company spokesman.

Electricity generation has been an ongoing obstacle for business development in the Northern Emirates since 2008 and, in 2011, the Federal Government pledged Dh5.7 billion in water and electricity infrastructure to the area.

The Federal Electricity and Water Authority (Fewa) supplies water and electricity to the Northern Emirates at a rate of 20 to 33 fils per kw per hour for residential and commercial consumption. However, Fewa does not supply power to freehold properties.

Al Ghail Power, a utility owned by Ras Al Khaimah Investment Authority, supplies electricity to Al Hamra Village and its rate is 40 fils per kw per hour, with a variable of five to 10 fils depending on the gas rate.

Al Hamra Real Estate said it plans to establish uniform rates by the end of the year but owners have said they cannot afford to wait.

"When my electricity and water is cut off, I will have little option but to abandon my apartment and the significant part of my pension fund that it represents," said Martyn Pearce, a UK resident. "At 70 years of age, this is a blow I cannot recover from."

Al Hamra reiterated its previous statement that bills are dealt with on a case-by-case basis.

The installation of the BTU system delayed bill delivery and some utility invoices were delayed by up to three months.

That meant that some owners were unable to recover fees from tenants who had already left months earlier.