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Expats living in Sharjah freehold property to pay more for power

‘Standard’ rate of 45 fils replaces previous ‘subsidised’ rate of 30 fils per unit

Sharjah Expat tenants of freehold property where the owner is not Emirati have started paying a “standard” rate of 45 fils instead of the previously “subsidised” 30 fils per unit of electricity in their monthly utility bill in Sharjah, officials told Gulf News on Tuesday.

The previous rate of 30 fils per kilowatt-hour (kWh) has been “adjusted” to 45 fils in applicable cases – a 50 per cent change. This only applies to the electricity segment of their monthly utility bill, and is not levied on water or gas consumption, whose rates remain unchanged in all cases.

On Tuesday, officials from Sharjah Electricity and Water Authority (Sewa) provided to Gulf News details about the “freehold tariff” system. There had been queries from affected residents recently who said they were unaware of the system.

The standard rate had started being implemented in phases since January, officials said, with some expats receiving the charge for the first time as recently as July. It is understood that as more applicable cases are updated with Sewa, they too will be charged the 45 fils rate from that point onwards.

Sewa officials confirmed the bills will not be charged retroactively or backdated to January. An official added that the move follows, and comes in line, with the applicable freehold regulations of the Federal Electricity and Water Authority (Fewa).

During Tuesday’s Sewa presentation to Gulf News, officials defined freehold property that is subject to the 45 fils rate as “a property owned by non-locals [non-Emiratis]”. However, if the tenant is an Emirati, he or she will be exempt from the new rate. Similarly, if the owner is an Emirati, the rate does not apply.

In other words, the rate applies where both the owner and tenant is an expat.

It was not immediately clear how many such cases there are in Sharjah, or what percentage of the total number of Sewa residential customers they represent. However, a senior Sewa official said they are “a very small minority”.

In Sharjah, according to a 2014 ruling, Gulf nationals and Arabs can purchase property on a freehold basis, while other nationals can acquire a 100-year lease, in select areas, projects or towers.

Gautam Nirmal, an Indian tenant of a two-bedroom freehold apartment in Sharjah, said: “I was surprised to see a 50 per cent increase in my electricity use rate in my July [Sewa] bill. There was no announcement or explanation from Sewa saying this was going to happen to me.”

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Service charge

Also, Gulf News can reveal that starting from September 1, “expatriate residential customers” of Sewa will have to pay an additional service charge of 0.05 fils per unit (of kWh) if they exceed an electricity consumption threshold.

The new service charge system applies to expats living in a building owned by an Emirati, which is the most common scenario, an official explained.

The threshold allotted to their category will depend on the type of meter at their residence. The metre-type is mentioned under “Metre & Reading Details” on the Sewa monthly bill.

For 1-Phase meters (typically installed for studios) the threshold is a maximum of 1,400kWh. For 3-Phase (normally installed for one, two and three-bedroom apartments) the threshold is 1,600kWh. For CT (usually installed for villas), the threshold is 2,000kWh.

Currently, expat residential customers pay a flat, fixed monthly electricity service charge of Dh70 for 1-Phase; Dh80 for 3-Phase; and Dh100 for CT, regardless of consumption. This charge is mentioned on the Sewa bill.

Starting from September, customers will have to pay an additional 0.05 fils for each unit that is consumed over and above their threshold. A senior Sewa official said only one or two per cent of customers are expected to go beyond their threshold.

Exempt cases

The official also pointed out that three categories of Sewa consumers are exempt from the new service charge: “UAE nationals, freehold premises, and government premises”.

The 45 fils rate and new service charge system are mutually exclusive, meaning an expat will either be in freehold property (paying the applicable 45 fils rate); or in the residential category (paying the additional 0.05 fils per unit, if they exceed their threshold).


Box: New charges

If you are an expat living in a freehold property that is owned by a non-UAE national, then you will be (or have started) paying 45 fils per unit of electricity consumed, instead of 30 fils rate previously

Starting September 1, if you are an expat living in a residential property owned by an Emirati, like most apartment buildings, you will have to pay an additional 0.05 fils for every unit of electricity consumed above the threshold allotted to your meter.