energy in si g h t o f d r. f. k ab g a m b e epsi power ... · pdf fileuganda’s rural...

EPSIENERGYPOWERSUPPLYINSIGHTS

Insights of Dr. F. Kabagambeformer PS, Min.Energy

Uganda’s Rural ElectrificationChallenge

How ERA was established,its role and challenges

UGX 7000| VOL.01 ISSUE 02 APR. 2017

THE FUTURE OF ELECTRICITY

New Power sources

The History of Karuma DamSolar Energy in Uganda.

Implementing power projects Of National Development Plan II

NDPImplementing power projects Of National Development Plan II

Implementing power projects Of National Development Plan II

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Harnessing Renewable Energy Resources To Achieve A Per Capita Consumption Of 3,668Kwh – The Role Of The Electricity Regulatory Authority

For Uganda to shift from a peasantry to an industrialized and largely urban society, it must be propelled by

electricity as a form of modern energy. Energy and in particular electricity is a driver of social-economic transformation of a nation. Countries like Malaysia, Singapore, and South Korea that have attained faster growth have used modern energy to drive their industrialization and service sectors. This necessitated the generation and development of sufficient sources of energy to drive those economies.

The Government of Uganda, in aspiration to transform the Ugandan society from a peasantry to an industrialized one, set targets that would aid the country in its march to the desired economic status as outlined in the “Vision 2040”. These targets include the development of sufficient energy sources. It is estimated that Uganda will require 41,738 MW by 2040, thus increasing its electricity per capita consumption to 3,668 kWh and increase access to the National Grid to 80 per cent.

The Electricity Regulatory Authority (ERA) as a central actor in the Electricity Supply Industry in Uganda has set its focus on deliverables that would accelerate Government of Uganda’s aspiration of availing 41,738 MW with a per capital consumption of 3,668kWh of electricity. By addressing the country’s power supply security through the Ten-Year Least Cost Generation Plan; Efficiency; Transparency and Accountability; and Operational Excellence, ERA has established a favourable regulatory framework that has so far attracted private sector investments of over US$ 2 Billion to-date. The Authority has also established and managed the setting of Cost-Reflective Tariffs; setting of clear Performance Targets for licensed companies; Approval of Investments into the Distribution segment; and Acceleration of Electricity access. This is how all this has happened:

(i)Setting of Renewable Energy Feed-in-Tariffs

The overall aim of the Renewable Energy Feed-In Tariffs (REFITs) is to encourage and support greater private sector participation in power generation from Renewable Energy technologies through the establishment of an appropriate regulatory framework. The REFITs apply to small-scale Renewable Energy systems of prescribed priority technologies of up to a maximum installed project capacity of 20 MW and greater than 0.5 MW, as defined by the Electricity Act, 1999. The priority technologies for the REFIT Phase 3 include Hydro (Small Power Plants), Bagasse and Wind. Additional technologies can be added in line with the REFIT review process.

The Authority in July 2016 approved the revised Renewable Energy Feed-In Tariff Phase 3 Guidelines. The guidelines are meant to provide clarity and guidance

to Project Developers, Investors and key institutional stakeholders on the crucial components and operational structure of the Renewable Energy Feed-In Tariff. The detailed revised Guidelines are available at www.era.or.ug.

(ii)Global Energy Transfer for Feed-in-Tariff

Working with the Government of Uganda and KfW, ERA developed the Global Energy Transfer for Feed-in-Tariff (GET FiT) Program in 2012 in order to increase Uganda’s energy production to mitigate possible power supply shortages before the Large Hydropower plants are commissioned.

The main purpose of the GET FiT Program was to fast-track development of Renewable Energy generation projects of 1 MW – 20 MW, promoted by Private Developers, with a total installed capacity of about 170 MW/ 830 GWh per annum. The Premium Payments constitute a

Setting of Renewable Energy Feed-in-Tariffs Development of Standardized Power Purchase AgreementsLight-handed RegulationStrengthening relationships with key Stakeholders

Also in this section

Ziria Tibalwa Waako , CEO ERA

energy power supply insights 3

result-based incentive grant designed to enhance the financial viability of the selected projects and are payable as a top-up premium of US cents 0.5-2.0 per kilowatt hour to the Project Developers in addition to the relevant REFiTs determined by ERA.

To-date, the GET FiT Program has approved 17 (seventeen) projects with a combined capacity of 156 MW. Thanks to the GET FiT Program, Uganda in December 2016 welcomed the first-ever and largest Grid-Connected Solar Photo Voltaic Plant in East Africa, the 10 MW Access Solar Uganda Plant that is located in Soroti District, Eastern Uganda. A number of Hydropower projects supported by GET FiT are expected to be commissioned this year, while the entire portfolio is expected to be commissioned by the year 2018. Following the great success of GET FiT in Uganda, the Program is due for roll-out in other countries in Africa.

(iii)Development of Standardized Power Purchase Agreements, Implementation Agreements, and Model Licenses

ERA in consultation with Development Partners, Lenders and Power Project Developers developed Standardized Power Purchase Agreements (PPAs), Implementation Agreements (IAs), and Model Licenses. This has resulted into the reduction in advisory service costs and the time required to negotiate the first initialling of a Standardized PPA by a Developer and Uganda Electricity Transmission Company Limited, the off-taker, (from two months to half a day).

(iv)Licensing TimelinesThe Authority revised the License and Notice of

Intended Application forms and accompanying guidelines, with the aim of simplifying the licensing process. Further to this, the Authority developed due diligence tools for use in the evaluation and monitoring of projects to enhance its efficiency as manifested through the reduction in the licensing period from six (6) months to three (3) months.

(v)Light-handed RegulationThe Authority recognizes the enormous potential

of Off-Grid and Mini-Grid Systems to accelerate access to electricity. In line with Section 113 of the Electricity Act, 1999, ERA in 2007 established a framework for light-handed regulation of isolated Grid-Systems with a capacity not exceeding 2 MW. Under this framework, eligible projects are awarded a Certificate of License Exemption.

The Certificate exempts a holder from compliance with the stringent License requirements such as payment of annual License fees, frequent (quarterly) reporting to the Regulator, and the obligation to obtain a Permit for conducting detailed feasibility studies. ERA has developed a Standardized Application Template for a Certificate of License Exemption, with the view to enhancing transparency and expediting the application process. To-date, ERA has issued Certificates of License Exemption for projects in Kalangala, Kabale, Kanungu, and Mityana Districts.

Moving into the future, ERA is focusing on creating a conducive environment for attraction

and involvement of the Private Sector in sustainable Off-Grid development. Accordingly, the Authority is currently considering the prospect of developing less stringent Quality of Service Regulations and Grid standards in respect of Mini-Grid Systems. Development of Solar Off-Grid and Mini-Grid Systems will be of particular interest in this regard, given the vast availability of the Solar resource in Uganda, coupled with its modular nature. This implies that several solar points can be assembled and utilized by different consumers in one geographical space.

(vi)Strengthening relationships with key Stakeholders

ERA has strengthened its relationship with key stakeholders, including Development Partners and agencies of the Government of Uganda, most notably, the National Environment Management Authority (NEMA) and the Department for Water Resources Management (DWRM) and Development Partners. Constructive engagement with the Development Partners has provided avenues for Project Financing through Programs such as GET FiT. Similarly, close relations with NEMA and DWRM have resulted into reduction in the time taken to issue Environmental Certificates and Water Permits to Intending Developers, which has eased transaction of business for Private Investors.

(vii)Information pack on Renewable EnergyIn 2015, the Authority developed a Web

Portal that is a one-stop information centre for Renewable Energy Projects. The portal is accessible through the Authority’s website: www.era.or.ug, and provides information that is relevant for the development of power projects in Uganda.

In view of ERA’s deliberate effort to promote the development of Renewable Energy Technologies, we are especially proud that in October 2016, the Fieldstone Africa Renewables Index ranked Uganda in 2nd position among the “Big Five” countries on the continent of Africa in respect to promotion of Renewable Energy. The country was particularly recognized as a result of increased electrification and recognition of superior Solar and Hydro resources, combined with smart interplay of an enabling regulatory environment, created by the Electricity Regulatory Authority. This is only one of several recognitions and awards that ERA has received on account of Renewable Energy development.

The Authority commits to steadfastly champion development of Renewable Energy technologies, as a step towards increasing access to electricity and improving the quality of electricity supply in Uganda.

energy power supply insights4

Contents

©Frank Energy Consultants ltd. All rights reserved. Neither this publication nor any part of it can be reproduced stored in a retrieval system, or transmitted in any form or by any means, electronic, mechan-ical, photocopying,recording or otherwise, without the prior permission of the energy power supply limited. Published quarterly. For address changes, subscription enquiries and current general terms and conditions, please visit www.frankconsultants.com or send an email to [email protected] or send a postal mail to Frank Consultants ltd, P.O. Box 72030, Kampala, Uganda. Energy power supply insights seeks to provide accurate and unbiased informed analysis of business. For any corrections or comments, please contact us.

In the Next Issue.

Keith Muhakanizi talks about the investments within the Energy Sector.

Energy consumers are asking, whether the privatesector led philosophy remains valid, with one ofthe local private distribution companies foldingup? For Umeme Limited to quietly return toUgandan ownership through the Uganda SecuritiesExchange, isn’t this the time for the Government,to bite the bullet and return formally to investingdirectly in the rural and gener-al distributionnetworks? This would most likely avoid idlegeneration capacity (when generation doubles)in the midst of very high? access rates to modernpower.

On the cover

Rural Electrification challenges & the way to goThese include connectivity, reliability and more private sector participation that would hopefully enable increased supply of reasonably priced and reliable electricity to the economy.

ERA, How it was formed Electricity supply, like many other services previously supplied by government were being divested from government ambit with the view that most of them would be best managed by private sector companies.

Interview with Dr. F.Kabagambe

Dr Kabagambe – Kaliisa is a retired civil servant BUT currently is a geologist, an entrepreneur and family man. He is a son of the soil in the present Hoima Municipality.

Regulation of Supply of Petroleum

Karuma Dam: will it see light of day

Consultancy

Solar panels

Aerial view of the dam

The petroleum Act 2009 states that any commercial activity involving petroleum products which are not in compliance with the quality standards established under the Act or other laws; (2) A holder of a permit or license shall inform the Commissioner within twenty four hours

The role of the Consultant to the consumers in the electricity sector was to develop designs and documentation through studies to address the Client’s needs with regard to the electrical installation requirements.

In January 2011, Energy Infratech Private Limited, the Indian company contracted to perform the feasibility study for the project, said the estimated total cost for the dam and power plant was approximately US $2.2 billion, which included the cost needed to build a transmission line from Karuma to a location where the power will be integrated into the national power grid. Furthermore, the construction costs for the high voltage transmission lines were also estimated to be above US$200 million.

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Editorial

The Strides Of The Energy Sector In Uganda

In this second edition of the Energy and Power Supply Insights (EPSI) we introduce the publication’s Editorial Board comprising of four

eminent persons. These four will guide the EPSI editorial policy and content. Content suitability will play a major role in the sustainability of this mouthpiece for the energy suppliers of the country. The Editorial Board is grateful to our advertising sponsors who this time round have greatly defrayed the cost of EPSI production.

Away from the editorial matters, this second edition of EPSI while bringing on board the energy (petroleum) side of its expected coverage, at the same time have a wide range of topics in the electricity sector. We are looking at Karuma Hydropower Project, from the perspective of its long journey of more than seventeen years, since inception with its construction close to completion.. This particular article should provoke you to ponder the appropriateness of the methods we use to acquire power generation plants; the numerous investigations, the lost time vis a vis foregone economic benefit to the nation. The

pertinent and provocative questions are “Do these investigations address the fraud/corruption issues effectively? Do we know the real costs of delayed project implementation and how do these compare with what is lost through fraud and investigation costs?”

Of special interest in this edition is the rural electrification progress; are we meeting the targets and are the people benefitting adequately from resources expended. At below 20% access to grid electricity in nearly twenty years of liberalization, is the rural electrification program in place, the most viable to address this national concern? A related and perhaps more urgent question is around the obvious mismatch of coming generation capacity (reportedly to double in under two years from now),transmission and distribution networks whose roll out has been described by some as at snail speed.

Energy consumers are asking, whether the private sector led philosophy remains valid, with one of the local private distribution companies folding up? For Umeme Limited to quietly return to Ugandan ownership through the Uganda Securities Exchange, isn’t this the time for the Government, to bite the bullet and return formally to investing directly in the rural and general distribution networks? This would most likely avoid idle generation capacity (when generation doubles) in the midst of very high? access rates to modern power.

As promised in the first edition, in this second edition we bring the first comprehensive interview with one of the more eminent players in the sector; the long serving Permanent Secretary (now retired) Dr Fred Kabagambe-Kaliisa on his professional and public life, achievements and challenges at the head of the technical team of the Ministry of Energy and Mineral Development. A man who served in the public sector for over 40 years, definitely has something to share with us and some valuable insights of the energy and power sector. After all he led the technical teams that drafted the power sector liberalization law, as well as the national oil and gas law. He reveals the thinking and goings on that delivered the present energy and power sector operational framework. Be assured the interview highlights important aspects of the present and most likely future outlook of the Energy and Power subsector.

The networks transport the energy from the generators to your home.

Do these investigations address the fraud/corruption issues effectively?


Who is who?Editorial Board

1.Eng Dr Francis Fredrick Tusubira (Tusu)

F F “Tusu” Tusubira is an expert in the ICT sector, and currently chairs the National Information Technology Agency. He has also served the boards of the National Citizenship and Immigration Board; the Electricity Regulatory Authority; Uganda Communications Commission; the Research and Education Network of Uganda; the Busitema University Council (chaired the Appointments Board); UbuntuNet Alliance for Research and Education Networking (also founding CEO);and TENET, the research and education network of South Africa. He holds a PhD (Southampton, UK), an M.Sc.E (New Brunswick, Canada), and a B.Sc. (Engineering) 1st Class Hons (Makerere University, Uganda). He is a Chartered Engineer. An active Rotarian, he serves as a leader and a volunteer both locally and internationally

2.Mr Samuel S Bunnya

3.Mr Frank Kabushenga

Frank Kabushenga is an Accountant with an ACCA certificate, Entrepreneur, Author, and Publisher and has worked within the media arena for the past 15 years. While in the Media and Corporate arena, he has gained expertise in: Critical thinking, Social behavioural assessment, Insight writing, Keynote Speaking, Peer counselling, Media consultancy and TV content production. He has written, edited and published various books including many autobiographies of eminent persons. Mr Kabushenga is deeply involved in church ministry and has served at All Saints Cathedral Kampala as Chairman Evangelism, Young Marrieds Fellowship, now Vice Chairman of the Home cell ministry and National Coordinator of the Corporate Fellowship

It is with pleasure that Energy and Power Supply Insights (EPSI) introduces its Editorial Board to its esteemed readers. The Editorial Board of four persons already met and agreed in principle the Editorial Policy that will guide on strategic direction for EPSI, content and operational/management of the publication. The four eminent persons are:

Dr Sebbowa is the Acting Managing Editor of EPSI. He is a mechanical engineer with extensive university teaching and research experience, from the Nairobi University and Makerere University. He has senior management experience from leading Uganda Clays Limited for ten years, the Electricity Regulatory Authority for another ten years and Uganda Investment Authority for four years. He has now retired into private consultancy and is the Principal Consultant at Frank Energy Consultants the proprietor of Energy and Power Supply Insights. He is a Rotarian in good standing for many years.

4.Eng Dr Frank B Sebbowa

Is a young media professional who has been working in the media industry for the past four years, despite having graduated with a Bachelor in Commerce from Makerere University. Samuel is also an internationally published author, whose book was published in 2012. This was after his secondary school education at St Mary’s College Kisubi, and during his first year at the university


Is Solar Energy The Future For Uganda?Nazzinda Denise

“Which one is the cheaper option?”

That’s the question most people ask when they walk into a store. This is because

customers are naturally bargain hunters. Well, they are not just looking for the cheaper option in terms of price, sometimes it is because of quality in the long run. This is why many would want to buy a product that will last for a long time as it also performs its functions effectively. This assumption seems to be working in the energy sector of Uganda.

Uganda has adopted various forms of energy over the years from hydroelectricity, charcoal, gas, solar and many others, thus creating a very competitive market, but one energy form that has really stood out is the solar energy. When it comes to comparing the sources of energy Ugandans use for electricity, solar energy is competing highly with hydroelectricity. This is because customers are bargain hunters, people are always looking for a cheaper alternative that can carry out the function they want.

If you look at solar energy in this regard, you will find that it is a cheaper source of energy to use for various things like domestic work, watching television and even be used to run small businesses that deal in electronics. Various numbers of people in the country have adopted solar power in a bid to cut high costs that stem from using hydroelectricity. This doesn’t seem to be changing even with the introduction of Yaka, an electricity pre-payment system, which seems to be easier to adopt in homes.

According to the Introduction of Solar Energy in Uganda Project carried out by JEEP Folkecenter (Joint Energy and Environment Projects) and Uganda Nordic Folkecenter for Renewable Energy, Denmark, less than ninety percent of Uganda has access to modern types of electricity.

With less than twenty percent of Uganda connected to hydro-electricity, many families in villages have resorted to using kerosene lamps and this is slowly being reduced due to the adoption of solar power in rural areas. Musiima Rhoda a student at Makerere University says, “We use solar electricity in the village to do various domestic

work and pretty much everything that hydro power can do. Our neighbours too have adopted and so have various families in the neighbourhood”.

Solar energy is not the cheapest energy option in Uganda but it seems to be the most competitive option to hydro power, with many small businesses shifting to use it as well. This is a favourable option of an energy source for Uganda since the country is located in Sub- Saharan Africa where a tropical climate exists. Uganda is a country that does not have extreme weather conditions like winter, but has plenty of sunshine meaning those that rely on solar power are at an advantage.

In an article on solar energy written by Stephen Otage, Ms Cornelia Zupp, the project coordinator Partnership Project Chamber of Skilled Crafts and Small Businesses for the Uganda Manufacturers’ Association, said businesses that are run on energy should begin thinking of investing in solar power plants because this is the future source of energy to power them. “Solar electricity can power anything run by hydro-electricity. We have seen villages powered using solar electricity, fish factories, Islands, it depends on the investments and this is the future for Uganda.”

The government of Uganda has invested a lot of effort to grow the solar industry throughout the country. In 2016 East Africa’s largest solar power plant worth $19 million was launched in Soroti district under the Ministry of Energy and Mineral Development in partnership with Access Uganda Solar Limited. The African News online publications writes that the facility covers 33 hectares and will produce around 20 gigawatt hours of electricity each year, enough to transform lives across the region. Solar analysts say that it is Uganda’s first grid-connected solar plant as the country looks to raise power generation capacity to 1,500MW by 2020, from the current 850MW.

Statistics from the Electricity Regulatory Authority indicate that peak demand for power is growing by 15% every year. This is due to the increasing population of Ugandans, thus more energy options other than hydroelectricity are needed to enable at least half of the country’s

Who is who?Solar

Laying of the Solar Panels in Soroti


population to have access to electricity. This is where the use of solar energy could help to solve part of this problem.

Could this be the key to solar energy dominating the energy industry in Uganda in the next few years? Maybe, or maybe not, depending on the knowledge that the Ugandan public has about this energy source. But as expected people in the rural areas outside the national grid are adopting to the use of solar energy much faster than those in the urban areas of Uganda because it is a cheaper option compared to hydroelectricity. Urban dwellers on the other hand, find it easier to use hydroelectricity because of the complex number of gadgets in their houses, which they believe that Solar Energy cannot properly efficiently service.

However, with various innovations that run on solar energy like phones, radio sets and small solar plates that can accommodate light electric functions like cooking, lighting and ironing many people in the rural areas of Uganda have found it convenient to use solar energy. Does this mean that massive adoption of use of solar energy will spread from the rural areas to the urban areas of Uganda? This might be the future trend if more people in the rural areas keep adopting the use of solar energy. This could imply that with time depending on the performance of Uganda’s economy, majority of the population in the country will adopt solar energy in their homes and hydroelectricity will be used less.

This new solar plant in Soroti will be able to not only serve Uganda’s needs but also those of surrounding countries in the East African region.

This new development could also facilitate greater innovations from the Information Technology sector of Uganda. A few years back students of Makerere University developed the Kira EV Vehicle. This is a car that runs on solar energy, which means instead of using petroleum to keep it on the road, one can easily refuel it using the sun. These and more innovations can be facilitated with a new solar power plant in the country. This might also eliminate questions like what happened to the innovations that these students come up with. Most of these good innovations die away simply because the resources to run them are not enough.

The new solar plant can help government to fund and help to develop such ideas and even more thus developing the Ugandan industrial sector. This could be a good start for this sector in the country. Imagine an industrial sector running on solar power, this can better the economy and even create more jobs for citizens thus reducing the poverty gap. An international media house, CNN wrote that this solar plant can power forty thousand Ugandan homes.

If this is actually true, this can boost people’s livelihood and even cheapen the cost of having electricity running in one’s home. Many businesses struggling with paying power bills especially around Soroti where the power plant is located could pay less power bills with the use of solar energy.

According to an article titled 10 MW Solar Power Plant to Boost Uganda’s National Grid, the State Minister for Mineral Development Peter Lokeris during the launch of the power plant said Uganda still faces energy challenges. “Government priorities such as Agro-processing can only get lifted off the ground

with sufficient and reliable energy. I have confidence in the project because our country enjoys an all year round sunny climate which is the resource for solar power.” There are so many possibilities and opportunities that Uganda can tap into with the adoption of solar energy.

The problem is even with these possibilities being known, there are still various challenges that are hindering people from using solar energy thus narrowing the path to a better future for Uganda that comes with using this form of energy. Some of these challenges include a vast number of the Ugandan population knowing little or no information at all about the benefits of using solar energy, so they cannot use it. Some people actually know about the existence of solar energy but still feel that it is expensive to use, so they would stick to using the cheaper alternatives to carry out domestic work, energy sources like charcoal/ firewood, paraffin stoves and lanterns, subsidized hydro electricity tariffs like Yaka from UMEME and many others. This could be due to the high costs that one incurs when installing a good solar system that can run basically all electricity needs of an entire home or business, though it is cheap in the long run.

A survey done by Village Energy Uganda shows that many people in the rural areas have the following barriers to solar adoption; distance, product quality, lack of financing and lack of servicing options. Another challenge is the reduction of solar energy power when there is less sunshine received in Uganda especially during the rainy season. This means that appliances

and businesses that run on solar energy will be slowed down in performance.

This slow pace of adoption of solar energy in the country has made various government donor efforts almost get done in vain. These include a tax waiver on the importation of solar equipment and funding from the World Bank, government abolishing import duty on solar equipment under the East African Community framework as well as exempting Value Added Tax (VAT) in order to make it affordable among many others.

These problems might exist but there are solutions that can help to increase the use of solar energy in the country. The Ugandan government can invest in sensitizing people about the benefits of using solar energy for both domestic and commercial purposes. It can also invest in building more solar plants in other areas of the country as big as the new solar plant in Soroti or even bigger depending on the current budget.

Behavior Change programs can be developed to help change the mind set of many Ugandans that can help create a huge shift to using solar energy because it goes beyond telling a person the benefits of using it but goes a long way in persuading them to purchase it. It creates a mindset of solar energy being worth the investment, as one will spend less purchasing it expensively at once than paying for hydroelectricity every month in over five years which is more expensive. With this said, we still have a long way to adopting solar energy on a large scale in Uganda if it is to be the answer to an easier future.

Solar Panel Installation by Village Energy technicians


Challenges and the Way to go for Rural Electrification in Uganda. Eng. Norbert Semitala

Formation of Uganda Electricity Generation Company Limited (UEGCL) and Uganda Electricity Distribution Company Limited (UEDCL)& ERA

The concession of the local private construction company, Ferdsult Engineering Services Ltd (FESL).

The major aim of these reforms that were concluded by passing the Electricity Act, 1999, was to

transform the electricity sector into a commercially viable and profitable industry through improved quality of services offered. These include connectivity, reliability and more private sector participation that would hopefully enable increased supply of reasonably priced and reliable electricity to the economy.

At the time, the country’s electricity sector was characterised by high levels of inefficiency, poor infrastructure, high technical and commercial losses as well as low investment.

The passing of the Act saw the unbundling of the former Uganda Electricity Board (UEB) and the establishment of three subsidiary independent companies that are charged with Generation, Transmission and Distribution of power to the final consumers.

Uganda Electricity Generation Company Limited (UEGCL), Uganda Electricity Transmission Company Limited (UETCL), and Uganda Electricity Distribution

Company Limited (UEDCL) were formed and mandated with generating, transmitting and distributing of power respectively.

It also led to the creation of the Electricity Regulatory Authority (ERA) that became operational in 2000 as the overall independent regulator of the sector. Its main function is to regulate the generation, transmission, distribution, sale, export and import of electricity as well as reviewing and approving electricity tariffs.

Through long-term concessions that were signed between government and private sector players, the generation and distribution business components were concessioned to the private sector. On the other hand, government, through UETCL, retained a monopoly on electricity transmission and bulk energy trading business.

UEGCL entered into a concession agreement with ESKOM for power generation at Nalubale and Kiira hydropower plants, UEDCL signed a Lease and Assignment Agreement with UMEME.

Central to this discussion is that, prior to unbundling, UEB was also responsible for

all aspects of rural electrification in the country but with enactment of the new law, we began to see a shift and looking at rural electrification differently from the main electricity stream.

However, it was very clear even at the time of enacting the Act that the private sector, which would take the lead in the generation and distribution segments, may not be interested in rural areas due to low profitability and economic activity. This was, nonetheless, taken care of in the Act through the establishment of the Rural Electrification Fund (REF) under the Rural Electrification Agency (REA).

The fund was established to promote the equitable coverage of rural electrification in Uganda through increased provision of access to electricity for economic, social and household use.

REF invests in power-distribution networks, isolated grid projects comprising generation and distribution activities, and in stand-alone systems using renewable energy, such as solar home systems.

The fund by law, is financed through a levy of 5% applied on all bulk electricity sales, parliamentary appropriations, surpluses from the operations of the ERA, and grants from donors and loans (including the World Bank).

Unfortunately, and central to this article, is probably not enough thought was given to the mode of operating the funds’ establishments. When the fund became operational, the first lines that were built lacked operators.This meant the fund had to find a way in which to operate and maintain them. Remember as mentioned earlier, it was quite common knowledge, that by rule of thumb, Rural electrification schemes were non-viable and would not be of interest to the private sector.

Notwithstanding that rule, the easy targets were some of the local companies, (private sector also) that had participated in the network construction because of their reasonable understanding of the power line construction and maintenance. They were hence encouraged to compete for operation of these lines.


The year 1997 shall be remembered by Uganda’s electricity sub-sector for it saw making of electricity reforms by the government. The reforms also saw the formulation of a comprehensive strategic plan for transforming the electricity sector into a financially viable industry.

Who is who?Rural Electrification

A Transmission Station


They were requested to include in their applications, business plans that envisioned the normal operation and maintenance charges and the thinking was that they would not necessarily have to do further investments because of the peculiarities related to investments.

As a result of this effort, the first concession was leased out in 2007 to one of the local private construction companies, Ferdsult Engineering Services Ltd (FESL), and is used as a case for this illustration. At the time there was very minimal experience in the operation and maintenance of rural grids. Therefore several assumptions were made in granting a lease, license and tariff.

It was agreed and expected that after two years, of operation, the parties would be able to discuss the outturns so that they can learn from the experiences of the years in operation, and this would inform the manner in which the concessions would be governed henceforth.

Unfortunately, it would appear that the REA focused on extension and growing of the networks without a considerable review of the energy sales volumes and customer connections that would have been the basis of the business case for the private operators.

On the other hand, the situation was also not helped by lapses in the management, on the part of the companies’ and to the extent that the concession activities were not adequately ringed fenced. The actual plight of the concessions’ business was not obvious until much later and it would appear to me that the companies’ other business activities were actually subsidizing the concessions.

Tariff setting for the private utilities was not necessarily premised on the true cost of doing the business, but possibly pegged to grid parity, and once again the requests for granting tariff review considerations by the regulator, would in most cases fall on deaf ears due to a series documentary proofs required by the Regulator to make the case, which the companies would more often than not be in position to furnish.

Given that the networks operated in the rural areas, were at the tail end of the existing UMEME infrastructure, several of which were dilapidated, these rural grids suffered a lot of outages leading to low energy sales and revenue collections.

As a result of several requests for network expansions by FESL to enhance connectivity and improve customer service in their respective concessions, REA through a correspondence at some point pronounced itself on the matter. The announcement gave guidance on how network expansions would be dealt with going forward, informed them to proceed and invest and to recover the costs like any other operator. Of course, this was a clear departure from the agreed framework at the onset and would have required a Regulatory framework to ensure that the investments made are approved prior, made, verified and paid for, for purposes of giving comfort to both the Investors and rate payers, pretty much like the main Distribution Service provider, Umeme Ltd.

In the latest applications made for tariff review

by FESL in 2016, the tariff proposals by the company were rejected by the regulator on the ground that the information provided fell short of their expectations and did not merit adjustments in tariffs. Instead, the prevailing tariffs were stayed leaving the private operators in a state where they would not fully recover their costs.

They continued operating in a fairly hazy manner and issues of “we are not recovering money” became a daily subject of engagement. Eventually, Ferdsult Engineering Services Limited (FESL) became unable to continue with operations and have since relinquished their three distribution licenses for the respective concessions to ERA.

As you may have heard, UEDCL, a government entity, has taken over the operations form 1st March, 2017 with a demand for a domestic tariff UGX 700 per kWh against FESL’s tariff at the time of relinquishing of UGX 512 per kWh.

The real lessons we get from this is that, the absence of a specific and well-articulated economic regulatory framework for running of Rural grids that ensures revenue protection for the private sector, coupled with high operation and maintenance costs characterized by long lines with inadequate critical loads and low economic activity, can only be a precursor for exit from the business.

The question, which I want to put out to colleagues in the sector; Is it really viable to have the private sector taking charge of the whole grand scheme of rural grid operations?

Should it be a public-private sector partnership in which the private sector, is given an “Operation and Maintenance” contract, is well facilitated on the basis of an agreed upon business plan between the operator and the government, in which case the, government would meet its obligations on what it shall provide according to the plan, as the operator also performs in accordance to the specific set of targets, be monitored and held accountable. The payment should be premised upon delivery of performance targets.

In my opinion, it is an issue of risk sharing, in which the private sector takes on the risk of “management” and government on the other hand takes the “Investment” risk with a view to stem the tariffs to these vulnerable folks.

Rural electrification schemes were non-viable and would not be of interest to the private sector.

Electrcity Transmission Lines


How Uganda’s Electricity Regulator Was Established. Eng Sebbowa Frank

Critical Functions of the Electricity Regulatory Authority

The Regulations and Statutes that Underpin the Electricity Act


1.Introduction:

Uganda’s power regulator, the Electricity Regulatory Authority (ERA), came about as a result of the

unbundling of the previously vertically integrated power utility; Uganda Electricity Board at the beginning of this century. Electricity supply, like many other services previously supplied by government were being divested from government ambit with the view that most of them would be best managed by private sector companies. The debate as to the necessity of unbundling of the power supply system and hence the creation of ERA itself. Many have debated the issue of value add brought about by having a multiplicity of companies handling electricity supply in the country where one was adequate before.

On another level questions have been raised as to the competence of the regulator to manage its statutory function especially supervising the private sector companies that have joined the power sector in Uganda as well as setting appropriate consumer tariffs.

It is the opinion of this author that the answers to all manner of questions

surrounding the electricity regulator can be found in describing why and how the regulator was created and then looking at its achievements to date and the challenges it has had to overcome to get where it is.

2.Electricity Supply LiberalizationThe political stability that followed the

National Resistance Movement liberation war across Uganda in the mid to late nineteen eighties re-started the economic activities in Uganda which demanded for quality and quantity improvements in the electricity supply system of the country. The system dependent on the Jinja hydro power station had been ran down over the years and even after restoration it would have proved, and it proved, inadequate to meet the increasing demand for electricity in the recovering Uganda.

The country just out of a civil war proceeded by economic mismanagement did not have the human and financial resources to provide the required infrastructure on its own. Also this was the time the World Economic order, principally driven by the World Bank institutions, demanded privatization

or at least liberalization of productive industries under the slogan “Government has no business being in business”.

The Government’s Ministry of Finance Planning and Economic Development set up the Public Enterprise Reform and Divestiture (PERD) Programme through which the Privatization and Utility Reform Project (PUSRP) emerged to guide the 1999 Power Sector Restructuring and Privatization Strategy (PSRPS). It is this later Strategy that yielded the enactment of the Electricity Act (1999) which repealed the 1954 Uganda Electricity Board founding law and provided the legal framework for restructuring and liberalization of the electricity supply system in Uganda. This created the pathway to the liberalization of the previously vertically integrated Electricity Supply Sector managed by the all-in-all Government parastatal; then called Uganda Electricity Board. Note that the present Energy Policy for Uganda was inaugurated much later in September 2002 after the Electricity Act was in place with most of its provisions already operational.

Because the Electricity Act 1999 allowed private sector entities to participate at the generation and the retail/distribution levels it had to create a sector regulator: the Electricity Regulatory Authority (ERA). The Regulator became operational in April 2000 and forms the main discourse of the following paragraphs of this paper.

3.Critical Functions of the Electricity Regulatory Authority

The Electricity Act (1999) empowers the Electricity Regulatory Authority (ERA) exclusive rights to:

i)Issue licenses for the activities in the electricity sector in Uganda

ii)Issue or approve technical and quality of service operational standards in Uganda

iii)To issues or approve tariffs for electricity in Uganda

Under the above three key roles ERA has powers to supervise and demand for complaisance with terms it embeds in the licenses and the tariffs it sets as well as the technical standards it approves and

Who is who?ERA

ERA Head Office


enforces. Among other things ERA

is required by law to gather information and data relevant to the sector and avail it for public reference as well as give advice to government. Over the years ERA has assembled a formidable database on the electricity sub-sector in its Resource Center at its headquarters. Unfortunately Ugandans do not value such assets. It is a sad reality that foreign investors are the majority users of this facility.

4.The Norwegian Support and Hydro Influence

The Royal Norwegian Government through its international development agency (NORAD) responding to the then World Bank call to support privatization and liberalization of public utilities and the Government of Uganda request for support assistance provided funding for the processes of liberalization of the electricity sector. Starting with support to the Ministry of Energy and Mineral Development (MEMD) strategy and policy studies, the development of the Electricity Act 1999 NORAD provided the financing and sometimes expert personnel. Norway’s electricity supply, in similarity to Uganda then, being heavily dependent on their rich hydro resources the advice and to a large extent the initial strategy and the Electricity Act 1999 were biased towards hydro power generation and distribution. Fortunately during the subsequent formulation of the supporting Regulations/Statutes this shortcoming was addressed by broadening aspects that made the regulation of thermal projects possible.

After putting in place the Board of Directors (The Authority), the sector Ministry of Energy and Mineral Development (MEMD) received further support from the Norwegian Government to enable ERA to establish itself.

Through the Norwegian Water Resources Regulator (NVE) The Norwegian Government and the Government of Uganda through the Electricity Regulatory Authority entered into a Memorandum of Understanding (MOU) for technical and financial support to the Electricity Regulatory Authority (ERA). NVE actually provided

technical personnel specializing in electricity energy and energy law, electricity regulation (economic and technical) as well as negotiations. NVE provided the upkeep of its staff while seconded to ERA in Kampala.

Through the same MOU ERA Board Members and newly recruited staff were able to travel to Norway and Sweden to experience hands on how electricity regulation worked.

Later on the money which had been designated for administrative support (rent payment and office provisions) was through mutual agreement used to take ERA staff for bench marking trips in South Africa, Namibia, Zambia, Tanzania and Kenya. ERA through government subventions acquired their own permanent home where ERA House is on Plot 15 Shimoni Road Nakasero Kampala.

The balance was used to train the technical staff in utility regulation both at the Washington DC (USA) Institute for Public Private Partnership (IP3) as well as at the Florida University’s Utility Regulation Institute.

Through this Norwegian support ERA got critical technical staff training in its infancy as well as benchmarking both in Europe and Africa. And because the government funding (initially slated for staff training) was available early ERA was able to procure land and build its own home (ERA House located at 15 Shimoni Road Nakasero Kampala), removing heavy dependence on the National Treasury for rent payments which can in a regulatory environment be a source of political or external pressure on the a regulator and hence limit their independence.

5.The Governance and Professional Personnel Development

The Electricity Act 1999 empowers the Minister Responsible for Energy/Electricity to appoint a five person non-executive Board (the Authority) with approval of Cabinet. The Minister is also empowered by law to appoint a Chairman of the Authority. The only condition being that the persons to be appointed must have expertise or experience in management, banking, economics, energy, power systems and law. The Board then appoints technical staff including

the Executive Director or Chief Executive Officer.

Initially the operations of the Authority were segmented into three operational directorates: Legal, Finance and Administration and Technical, by 2012 Economic Regulation had been added as a standalone directorate. Subsequently the Office of the CEO was beefed up to accommodate Public Relations and Corporate Affairs as well as Procurement.

Apart from the four directors and the CEO the staff establishment has grown from the initial 6 persons in 2001 to over 50 in response to increased activities within each directorate. ERA staff increasingly are out in the field handling Public Hearings for new projects where its technical staff plays the role of referees as the consumers question aspects of projects and the project developers provide answers. Thorough Public Hearings ERA gets and gauges public sentiments on issues of tariffs, environment protection as wells technology in use.

6.The Regulations and Statutes that Underpin the Electricity Act

Once the Authority had recruited sufficient technical staff and with the initial support of NVE of Norway, ERA embarked on the job of developing supporting statutes and or regulations to the Electricity Act 1999.

Of the outstanding ones are the following:

a)The Primary Grid Code (combining the earlier Grid Code and the Distribution and Retail Sales Code)

b)The Quality of Service Codec)The Tariff Coded)The Safety Codee)The Regulatory Framework for

Isolated (Off-Grid) Systems7.Financial Sustainability of the

Ugandan Electricity Regulator Utility regulators the world over

risk sacrificing their statutory independence primarily through absence of financial independence. As the saying goes he who pays the piper…. If government pays for the regulator’s critical expenses eventually, through cash starvation, the government can bring political pressure to bear on the Regulator in its favor.

ERA by law is allowed to collect 0.1% of prices paid for all energy sold by the distributor in the


country. But this proved inadequate to meet the financial needs of the Regulator.

The Government of Uganda subsequently concurred with the Authority to try and give ERA adequate financial independence through license fees which an ERA licensed entity pays annually for as long as the license remains operation. This is graduated according to the entity’s installed generation or transmission capacity and distribution load. Thus the Regulator is mainly financed by the power consumers since these license costs are a pass through for the operator.

8.Early Achievements of the Ugandan Electricity Regulator

Apart from getting financial independence as highlighted above and writing the various support statutes/ regulations to the Electricity Act, ERA over the years has licensed and regulated several projects as listed below:

i)The Successor Companies to Uganda Electricity Board were the first entities that ERA had to handle. These include: Uganda Electricity Generation Company Limited (UEGCL), Uganda Electricity Transmission Company Limited (UETCL), Uganda Electricity Distribution Company Limited (UEDCL) and from 2001 until its dissolution in 2005 Uganda Electricity Board (UEB). Two hydro power stations (Mubuku One - 5MW and Mubuku Three – 10MW) in the Kasese area were generating electricity and had to be licensed under the new dispensation.

ii)The Concessionaire Companies; which successfully responded to bids to operate electricity concessions such as: Eskom Uganda Limited (in power generation), Umeme Limited (in power distribution) and West Nile Rural Electrification Company or WENRECO ( in power generation and distribution)

iii)Fresh and now Operational Hydro Power Generation Companies:

a.The big hydropower generation plants licensed include: the Nalubaale extension from 60 MW to 180 MW, the Kiira 200MW and the Bujagali 250MW.

b.The mini-hydro generation plants are many and include: Kabalega at Buseruka – Hoima 9MW, Ishaha at Kanungu 6.6MW, Mpanga at Kamwenge 18MW, Mubuku 2 at Bugoye 13 MW, Nyagak in West Nile 3.5MW and Kisiizi 0.3MW which was only registered due to its small size.

iv)Operational Solar Systems The Soroti 10MW solar plant was

recently commissioned Numerous Solar Photovoltaic

systems in domestic and other small user arrangement some qualify to ERA registration.

v)Fresh Thermal Generation Companies:The operational thermal generation plants

licensed include:Kakira Sugar Works 52MW, Electromaxx

Uganda Ltd 50MW, Jacobsen 50MW, Kinyara Sugar Works 40MW, Lugazi Sugar Works 14MW, Kaliro Sugar Works 12MW, Mayuge Sugar Works 1.6MW and Bugala – Kalangala 1.5MW.

vi)Projects Under Construction or

Development:Projects licensed by ERA and at various

levels of implementation include:

Hydro: Karuma 600MW, Ayagoo 800MW, Muzizi

44.7MW, Nyagak Two and Three 10.5MW, Nsungyezi 39MW, Siti 21.5, Kikagati 16MW and Rwimi 5.6MW

Thermals:Namugoga 50MW, Tororo 20MW, Mayuge

15MWGeothermal:Buranga – Bundibujjo 100MW and Lake

Katwe 150MWvii)Transmission and Distribution

Networksa.Growth in both transmission and

distribution network b.Creation of Off-Grid distribution

networksviii)Other Aspects of Electricity

Regulationa.Regularly setting electricity tariffsb.Regulating Umeme’s Loss Reductionc.Controlling the Wiremen’s Professional

Competence

9.Challenges for the Regulator to Overcome

The main challenge to the Electricity Regulatory Authority has always been acceptance of the consumer tariffs it must set. This matter is historical starting with the non-cost reflective tariffs charged during the period (1950’s to early 2000’s) of the vertically integrated power system presided over by Uganda Electricity Board. Then rapidly followed by the heavily subsidies electricity consumption during the emergency thermal generation period (2003 to 2006) when a severe draught forced the country to hire and eventually deployment of thermal plants (2009 to date) as standby to mitigate absence of the relatively cheaper hydropower. This situation was compounded by the time of the procurement of the Bujagali hydro power plant which came in at higher than normal prices, due to cost of inputs at this time corresponding to the Chinese economic boom.

Government around 2011/2012

conceded to ERA that subsidizing was unsustainable and that cost-reflective tariffs must be paid by the electricity consumers. Power consumers in Uganda still have fond memories of the heavily subsidized electricity which does not help ERA as it sets electricity consumer tariffs.

The lack of a pipeline of structured bankable power projects has left the country and Regulator at the mercy of “merchant power plant developers” who bring to table unsolicited projects whose costing at times carries a lot of fat for the project promoters.

The Regulator is left with the task of proving and removing the excess fat which makes ERA extremely unpopular.

Except for specialized entities like IP3 and a few costly and far away American Universities, formal training for utility regulator staff is not covered by the region’s universities. This means that ERA has had to train staff on the job in many cases. The required engineers, economists, financial accountants/analysts and lawyers need several months if not years of the job training to be able to take on well trained and experienced staff often brought to the table by would be investors for negotiations. When their (ERA’s) experienced staff are poached by the private sector or regional regulators the exercise has to be repeated again.

10.ConclusionFrom its humble beginnings the

independent Electricity Regulator of Uganda has grown with the support the Government of Uganda and earlier support of the Norwegian Government. It has licensed many power projects and without doubt its stature has contributed attraction of numerous electricity supply investors to Uganda. The challenges ERA faces are normal in the industry and can only be addressed by the concerted effort of all stakeholders.

Government has no business being in business.

UEDCL TAKES OVER POWER DISTRIBUTION IN THREE SERVICE TERRITORIES

�e Rural Electri�cation agency has handed over the management and distribution of electricity in three service territories formerly managed by Ferdsult Engineering Services Ltd (FESL) to Uganda Electricity Distribution Company Limited (UEDCL).�e service territories are South Western, Sothern and North West-ern spread throughout twenty administrative districts of Uganda with a combined customer base of 24000 people, majority of who are rural domestic consumersFESL, who have been managing the power distribution business in these service territories for nearly 10 years, voluntarily relinquished the business citing a multitude of challenges encountered in opera-tions and delivery of services.�e Electricity Regulatory Author-ity together with the Rural Electri-�cation Agency nominated UED-CL to take over the management of these service territories and on March 1st 2017 UEDCL e�ectively took over this responsibility.At a handover ceremony held in Kyenjojo, Mr. Frankline Oidu Kizito the Chief Technical O�cer of UEDCL assured customers in the respective services territories

that quality of service will tremen-dously improve. �is was in reply to the numerous complaints of frequent power outages and poor service delivery attributed to the outgoing operator by the custom-ers and district leadership. Mr. Oidu further stated that well run state companies like UEDCL can foster growth and development since they are not primarily driven by high pro�ts.A detailed evaluation by the joint sectoral teams has revealed the immense growth potential in these new territories both from domestic consumers as well as small scale business customers. Investment in revamping the net-work in most areas is critical since as pointed out by the evaluation teams most network assets are in a poor state.

UEDCL has gained good expe-rience in managing rural distri-bution networks and was already operating in �ve other territories mainly in eastern and northern Uganda. In these areas, a modern prepaid metering system is critical for customer account manage-ment.Partnership with major telecom companies on e-payment for energy has given rural energy consumers great ease in managing their energy consumption and payments. �is is one of the many changes that are planned to be rolled out to the new service territories in a bid to transform them into commercially viable entities.UEDCL is mandated to maintain a state of readiness to takeover pow-er distribution business from any operator whose license is revoked or voluntary relinquished.

Kayonza Tea Factory is the biggest customer in all the UEDCL service territories

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UEDCL TAKES OVER POWER DISTRIBUTION IN THREE SERVICE TERRITORIES

�e Rural Electri�cation agency has handed over the management and distribution of electricity in three service territories formerly managed by Ferdsult Engineering Services Ltd (FESL) to Uganda Electricity Distribution Company Limited (UEDCL).�e service territories are South Western, Sothern and North West-ern spread throughout twenty administrative districts of Uganda with a combined customer base of 24000 people, majority of who are rural domestic consumersFESL, who have been managing the power distribution business in these service territories for nearly 10 years, voluntarily relinquished the business citing a multitude of challenges encountered in opera-tions and delivery of services.�e Electricity Regulatory Author-ity together with the Rural Electri-�cation Agency nominated UED-CL to take over the management of these service territories and on March 1st 2017 UEDCL e�ectively took over this responsibility.At a handover ceremony held in Kyenjojo, Mr. Frankline Oidu Kizito the Chief Technical O�cer of UEDCL assured customers in the respective services territories

that quality of service will tremen-dously improve. �is was in reply to the numerous complaints of frequent power outages and poor service delivery attributed to the outgoing operator by the custom-ers and district leadership. Mr. Oidu further stated that well run state companies like UEDCL can foster growth and development since they are not primarily driven by high pro�ts.A detailed evaluation by the joint sectoral teams has revealed the immense growth potential in these new territories both from domestic consumers as well as small scale business customers. Investment in revamping the net-work in most areas is critical since as pointed out by the evaluation teams most network assets are in a poor state.

UEDCL has gained good expe-rience in managing rural distri-bution networks and was already operating in �ve other territories mainly in eastern and northern Uganda. In these areas, a modern prepaid metering system is critical for customer account manage-ment.Partnership with major telecom companies on e-payment for energy has given rural energy consumers great ease in managing their energy consumption and payments. �is is one of the many changes that are planned to be rolled out to the new service territories in a bid to transform them into commercially viable entities.UEDCL is mandated to maintain a state of readiness to takeover pow-er distribution business from any operator whose license is revoked or voluntary relinquished.

Kayonza Tea Factory is the biggest customer in all the UEDCL service territories


ISO 9001 2008 Certified

UGANDA ELECTRICITY DISTRIBUTION COMPANY LIMITED


UEDCLPOLE TREATMENT PLANT

UEDCL Tower, 6th Floor | Plot 37, Nakasero RoadP.O Box 7390 Kampala, Uganda

Tel: +256 312 330300 | Fax +256 414 255600Email; [email protected] | www.uedcl.co.ug


“Having no power is more expensive than

expensive power”

“The costs cannot outweigh the benefits”

Quotes on Power

Kabagambe’s Interview

40 Years and 6 Months Serving the GovernmentDr. F. Kabagambe Kaliisa talks to EPSI

EPSI: Many people in both the Energy and Minerals Sec-

tors will obviously have heard about Dr Kabagambe Kaliisa. But who is Dr Kabagambe Kaliisa?

FKK:Dr Kabagambe – Kaliisa is a retired civil servant

BUT currently is a geologist, an entrepreneur and family man. He is a son of the soil in the present Hoima Municipality. He obtained his Bachelor of Science (Hons) Degree in Geology and Chemistry from Makerere University in Kampala, Uganda in 1976; a post-graduate Diploma in Mineral Exploration from the University of Mining and Metallurgy in Leoben, Austria in 1980; a Master of Science Degree in Petroleum Geology from the University of Aberdeen in the United Kingdom in 1987; Studied Management and Economics at Duke University, USA in 1992 and is a Certified Regulation Specialist of the Institute of Public Private Partnership and Loughborough University.

My experiences with my grandfather Miika Kaliisa who was in charge of salt mining here in Kibiro and other parts of Bunyoro inspired me to be a geologist. So being a geologist to me feels like it is actually in my blood.

EPSI: When did you enter public service and what

inspired you to go for a government job rather than

say self-employment or indeed the private sector?FKK: I entered Public Service in 1976. Those days there

was no post graduate geology course in Makerere. You had to go outside to do this post graduate. When we graduated, there was that urge of where can I find a scholarship and increase my knowledge base in geology. In the past the private sector paid good money but did not focus a lot on building the individual’s broad professional capacity. The only option was in the public service. So I joined the ministry, at that time it was called the Ministry of Land, Water and Natural Resources.

EPSI:Can you tell us about your early days in the

ministry?FKK When I joined the Ministry in 1976, we were

running into a transition because of the expatriates leaving. Some of us were posted upcountry to big positions. I was made the Regional Geologist for West Nile. I remember General Mustafa Adrissi was the Vice President of Ugnada. He wanted a water borehole at his home in Koboko. So I was summoned to go and cite a borehole for the Vice President. We did a very good survey and established where we had to drill to get the best water yield. Unfortunately this was about 300 meters from the house and note at the location pointed out by the General; a location with an old borehole that had failed to work. I tried to explain to him and he just laughed. I naively thought if this old man has laughed he has accepted that his choice location will have to be abandoned.

I mobilized the drillers to go and drill. The workers started the operation at the technically determined cite and left for my office in Arua. Unknown to me the General’s brother who had listened to everything called the General who had returned to Kampala telling him that we had ignored and despised his orders. The General instructed the commanding officer of Bondo Barracks to round up all these disobedient public workers starting with me.

I was saved by a driver, Mr Dudu, who I had befriended in Entebbe. The poor man run from Keri in Koboko to my official house in Arua told me to “just pack and go”. He said everybody involved in the General’s borehole project was already in the barracks in Koboko waiting to be taken to Bondo for final solution to their stubbornness.

I packed as advised by this life-saving driver

Dr.Fred Kabagambe-Kaliisa


Dr.Fred Kabagambe-Kaliisa at his farm

and came straight home to Hoima. I went to Bishop Baharagate and I hid my official vehicle there because I did not know how to proceed. The Bishop called the Commissioner of Mines and my boss to find out what was going on. The Commissioner confirmed that indeed my life was in danger and I had to stay in hiding. Somehow means were found for me to stealthily move to Kenya. After that, the Minister responsible, Juma Oris, directed the Commissioner go and supervise the Vice President’s borehole drilling where the Vice President wanted. This saved my boys’ lives as they were needed to mount the rig at the site where the old man wanted. They drilled for two weeks and hit nothing; the site was dry up to 140 feet deep. I was not there but the Director of Drilling told me that the Vice President came and they explained to him. He said ok, go back to the site where the young geologist had suggested. When they drilled at the correct site water was coming in plenty after just two days. The General on receiving the good news got me recalled and actually rewarded me with a Tata lorry for my wisdom on the job. Those were early days really.

EPSI:When did you get promoted to the

position of Permanent Secretary for the Energy and Minerals Sector? We know you are a geologist at heart and may be it was a consideration when the President picked you at technical head of the relevant Ministry.

FKK:I was not picked; I did a technical

interview and came top of 24 candidates

for the job in 1997. It is on record. I was never handpicked. I retired in 1999 from the public service but my contract has been renewed several times at the recommendation of the Uganda Public Service.

EPSI:What were the sector challenges then

and how did set about handling them?FKK: In 1997 Ministry covered was a big

sector. By that time it had all natural resources. I was managing meteorology, forestry, water – both urban and rural, energy sector oil and gas, and minerals. Then in 1998 the ministry was restructured into Energy and Mineral Development. It allowed us to focus on energy and mineral development. We did a situation analysis, how is the energy and mineral sector like then and where should go? One problem we found was that there was lack of understanding energy and mineral sector even at a very high level. The Ministry of Finance and the Prime Minister’s office were placing ministries in sectors. What were perceived to be important ministries were given their own sectors; Health, Education, Security, Internal Affairs, Foreign Affairs etc. Those got the lion’s share of the national support at the time. By the way the rest were called “Others”. Those “Others” didn’t matter in 1998, 1999 and so on.

After we articulated our position for sector status they said “okay you are economic functions together with others”. I pointed out that the energy and mineral sector is a domain in its own right, with significant impacts on the

national economy. Then they said “okay, you are now infrastructure”. I still said no and arguments went on until about seven years ago when we were accepted officially as the Energy and Mineral Sector.

You can imagine if you are planning with tourism, works, as “Others” you cannot drive your point. That was a very big challenge for people to understand.

For a long time, this sector was not having distinct policies to guide the public and private sector players on their roles. The other challenge was the lack of clarity in terms of having well defined policy documents, working guidelines and tools, which had to be operationalized into legislation.

Of course there was a challenge that you have competing needs elsewhere. This needed to be resolved at a strategic level. More importantly we had to answer the question what do we do now that will create an impact?

EPSI:The two sectors (Energy and Minerals),

for which you provided technical leadership in Government for many years are viewed by many of us as very different.

FKK:In 2001 there was a campaign to split

the ministry. I wrote a detailed letter to the President and I was saying it was premature, in future yes, but now we will lose strategic direction - things which we can do as an Energy and Mineral sector. Of course depending on any sector’s capacity of growth it can stand alone. Before sectors grow, if you start unbundling them too quickly, you will lose economies of scale.

At the same time, if you look at the energy sector and mineral sector, in terms of operations you can run them separately but you see at a strategic level it is good to have them together. They have the same characteristics. Typically both are a long term project. Even their payback period is really long. Both of these are industries of knowledge. You have to know. If you don’t know the power sector you can make a lot of mistakes, if you don’t know the mineral sector you can make a lot of mistakes. In terms of development of resources, you need expertise that cuts across both.

Really for me both sectors are very important. The mineral industry is an input into the manufacturing industry. The mining industry creates jobs backwards for people who are mining and forwards for people who are using minerals in the manufacturing industry.

The power industry, if you don’t have a steady good quality power supply you are


Who is who?interview

One problem we found was that there was lack of understanding energy and mineral sector even at a very high level.

not in business.

EPSI:If we focus on Energy and Electricity in particular.

Now that you are out of the industry, can you share with us your thoughts about the power sector at the moment?

FKK:To me sometimes thinking in the power sector

is wrong in that people are looking at price more than supply which is a wrong view. For me users would rather pay a high price for power and get good quality power. Having really good quality supply is much more important than the price itself. However the price should be realistic and cost reflective.

The challenge with quality of supply is transmission and distribution. If you don’t focus on that and are concentrating on reducing the price then clearly you have a big problem. There are two drivers in terms of quality. Are you generating it and transmitting it enough. At least generation we have struggled and fixed.

EPSI:Could you highlight for us the challenges that

called for a new Electricity Act in 1999?FKK:The sector was not attracting investment from

both private and public sectors. Twenty years ago Government systems did not value the sector highly to inject the required capital and the supply landscape was not attractive enough to entice private sector to invest. Secondly the assessment indicated a need to unbundle Uganda Electricity Board and allow competition between its successor companies and new comers to the field. This in itself called for a referee, the Electricity Regulatory Authority, if a level playing field was to be established and maintained.

Of course there was also a need for efficiency in terms of losses, prompt reaction, in terms of finishing projects on time. A sector that has been neglected for a long time takes time to recover. We skipped over putting investments in place, so what do we do next? We recognized the problem but consistently prescribing medicine for efficiency became political. A defining law was required to ensure transparency at all levels of the sector; hence the Electricity Act 1999.

EPSI:We hear at the time you left this 1999 law

was under review. What elements need to be considered for major revision and why?

FKK:The market structure – the industry structure –

when we made the law in 1999 we said everybody must sell to one person, Uganda Electricity Transmission Company Limited (UETCL). Practically

some of the electricity being transacted does not go through the transmission network. But all the same the parties have to sign a contract with UETCL which does not make sense.

We have a lot of thugs and thieves in the power sector because of the mild and ineffectual penalties for offences committed in the power supply system. Clearly you need to ensure that people who are vandalizing the infrastructure, stealing power and operating like cowboys get the preventative penalties.

When we designed the Rural Electrification Strategy and Plan we emphasized a lot on private Sector led commercially oriented rural electrification. With time we realized rural electrification does not make money whatever you do. No private sector is going to come there. Private sector is mainly driven by their profit needs. That concept has to be dismantled by law so that government is obligated to invest in rural electrification.

Finally the Public Enterprises Restructuring and Divestiture (PERD) Statue made the successor companies of UEB report to the Ministry of Finance, Planning and Economic Development while their policy direction is the preserve of the Ministry of Energy and Mineral Development. You know having two reporting masters is difficult. That has to be addressed by the amended law.

EPSI:What have been main benefits of the

concessioning of some aspects of the electricity sector? Where do you think challenges remain?

FKK:To me clearly, the major benefit has been private

Dr.Fred Kabagambe-Kaliisa sharing a delight moment during the interview.


sector investment. By the time I left over 1.5 billion US Dollars had been invested in the power sector by the private sector. That is what we were yearning for.

Secondly, power supply and stabilization. The challenges remain. Private capital is not like public capital. It wants a return. A cost benefit analysis will have to be done to establish what the nation losses when there is a power shortage vis a vis cost of expensive power such as thermal power.

On the negative side the private investors make too many demands some of which are detrimental to long term economic welfare of the country. They want a lot of guarantees. Also some poor staff attitudes have transited to UMEME thus casting the sector in negative light. Things like this take time to change.

EPSI:There were major electricity generation projects

implemented during your time at the top of the technical team: Do you care to share with us an example of these projects so people can understand the sector as it is now?

FKK:Bujagali hydropower station is repeated said to

be an expensive station for the nation but there are many things not in the public domain. I need to clarify a few facts surrounding this power station. We first attempted to develop Bujagali under an American firm; Nile AES which was directly sourced by the Government of Uganda. In 1999 AES was aligned with the Norwegian Procurement and Construction (EPC) VIDEC and proposed a tariff at time of 4.9 cents (US Dollar cents). After investigations of the project site and other reasons back at their USA headquarters these investors withdrew in 2001 quoting political circumstances and market issues. Then we had to source a new investor for Bujagali.

The new investor came in with the support of development partners like the World Bank. A new developer was sourced through competitive bidding on basis of return on investment and development costs. This investor (IPS of the Aga Khan Group) was required to use our traditional development financial institutions where Uganda is members such as: International Finance Corporation (IFC), European Development Bank and Africa Development Bank to try to reduce their cost of capital. IPS obtained the Engineering, EPC contractor (Salini of Italy) through an open competitive process completed in 2007.

Of course circumstances in 2007 were very different from what prevailed in 1999. The EPC’s (VIDEC) price in 1999 was 325 million USD Salini the best evaluated EPC bidder in 2007 came in at 500 million USD. The closest and second bidder in 2007 had quoted 750 Million USD.

In 1999 steel was 250 USD per ton when we closed procuring the developer and EPC for Bujagali in 2007 steel was 600 USD per ton. The price of cement in 2001 cement was 580 USD per

ton and by 2007 cement prices were double at 1200 USD per ton.

Remember that 2007 was also the rehabilitation time for the impact of the Tsunami in Asia and Hurricane Katarina in the USA, and most of the big contractors could not look at Bujagali in middle of Africa.

The construction started in December 2007 and commissioning was in 2012. Remember that at the time the real tariff to the domestic consumer was 1000UGX per unit and we were subsidizing it by 600UGX per unit. We were running the thermal plants rented after the huge impact of a severe draught that depleted our hydro power generation.

In comes Bujagali and bang there is no tariff subsid and bang there is no load shedding.

Thermal plants previously generating at 30 USD cents then are removed and Bujagali comes in at 10 USD cents per unit so you have reduced the tariff from 30 to 10 USD cents. Bujagali should have been eternally remembered as a savior but the coincidental removal of the subsidy from power consumers overshadowed all the benefits it brought.

EPSI:You have hinted at the deployment of very

expensive thermal generation plants. How do you justify the huge expenditure on plants such as Aggreko International?

FKK:Expensive power is more beneficial than having

no power. Having no power is extremely expensive. There is no doubt about it. Aggreko is a merchant operator speedily stepping on emergency basis. Uganda was in crisis of load shedding four days a week when Aggreko was brought on board this reduced to two days a week and none at all for critical service establishments. The cost of such operators is not small; and Aggreko charged us as per their emergency supply industry norm.

But we need to understand this issue; the fact is that there was a regional severe draught which was outside of our control. If we had had cascading dams like we now developed (Nalubaale, Bujagali, Isimba, Karuma and later on Ayago) on the Nile River we could have re-used the water several times over to mitigate the situation. As a country we had not invested adequately in power supply for a long time. We turned to the emergency solutions because we could not have constructed a hydro dam quickly when the draught struck.

EPSI:Under your watch several transmission lines

were built across our country. Do you have regrets on areas of Uganda you left unserved by the transmission power network?

FKK:I have no serious regrets. When we came in the

transmission network were only two corridors. Tororo – Lira, Tororo – Jinja - Kampala – Mbarara


and the conservative network Kasese for copper production.

If you get out now, in the South Western part of the country, you have Mabarara – Mirama Hills done. As you move up you have Mbarara – Kasese, Kasese – Fort Portal, Fort Portal – Hoima Kaiso Tonya, Hoima – Kinyara, Kinyara – Kafu being done.

If you come back to the central you have Bujagali – Kawanda, Kawanda – Masaka is being done, Masaka – Mbarara is being done. You have Karuma – Kawanda being done.

In the east the old line is being refurbished. Then you have a new line all the way to Karamoja being done. In the north you have Lira – Gulu being re-done, and then from Gulu up to Aswa near Kitgum. The challenge I see is to see that the lower voltage distribution network which is not as robust as it should be to deliver the increasingly generated power to consumers. Government might have to re-think its detachment from this segment of the power supply system if it is to avoid a mismatch between actual electricity consumption and installed generation capacity.

EPSI:The level of rural electrification in the

Uganda is far worse than Kenya although rural electrification programs started earlier in Uganda. How should we take this?

FKK:If you are a pioneer things can be tough. Kenya

embarked on their rural electrification program later than ourselves. They just got parts of our and others’ rural electrification programs and understood them and adopted these to their needs. As I said the bottlenecks of private sector led, commercial oriented development gave Kenya good lessons. They threw away those bottlenecks and implemented the good bits. Kenya for instance is directly investing a lot of money in rural electrification. Investment is mainly public with private sector only a follower of Government. For us government investment comes like thunder; when there is a campaign you get some money then it goes back. Hopefully the revised law will create some direct and consistent cash flow from government for rural electrification.

Secondly, our population unlike Kenya is over rural and thinly dispersed over large areas. This indicates a need for another more innovative solution. The solution could be in standalone solar systems. However solar, unless there is government intervention, is still very expensive.

EPSI:Would you care to share with us the benefits

from the energy saver campaigns run by government over the years? Have they been worth it?

FKK:In terms of domestic homesteads energy savers

have a wonderful job, reducing bills. About

30MW new generation build was saved. From industrial energy auditing the industries have learnt to care for their electrical equipment while conserving energy and reducing their own bills.

EPSI:Let us talk about the Mineral Industry in Uganda.

What are your thoughts on its current status? FKK:We did appraise Uganda’s mineral potential

through an airborne survey covering about 80% of the country outside Karamoja. Because of insecurity then we could not do Karamoja. We were able to demarcate over 16 mineral targets in the country of various types. We were able to detect over 10 very good targets of uranium in the country. As a Ministry we followed up those targets:

Iron ore: For a long time we had only known that Muko

site in Kigezi had 3 million tons, after this survey we have established well over over 200 million tons of iron ore in the country.

Oil and gas: In 1997, I was only handed over one small

company which was struggling to do some work in Semiliki area. As I left I handed over a resource of 6.5 billion barrels of oil in place, so why wouldn’t I be happy with a sector where I have been leader of the team that discovered such important resources. It is up to the current managers to ensure these resources are exploited.

EPSI:What informed the decision to train more


geologists and may be not so many engineers for the Mineral Industry?

FKK:Makerere University trained geologists. You

need to find minerals first. There has always been a gap. It was unfortunate but we have now corrected that. Busitema University is now turning out good mining engineering graduates.

EPSI:Let us talk about the oil and gas industry. Are

we likely to see a thriving oil and gas industry in the country soon?

FKK:You see this industry is in stages. There is

exploration of the potential area. A significant part of the potential area has been explored so far. Then there is the development stage. It comes in with massive equipment. Like what is going to start next week (starting 3rd April 2017) when we will see Total putting up a central processing facility for cleaning crude…when you will see the construction of the pipeline, the refinery – that development work comes in with a lot of specialized work force, a lot of equipment, a lot of activities and huge capital inflows.

So in the course of this year we are going to see increased activity coming in because of the development work which is starting to be done. It is after this stage that we expect to go to the last stage of actual oil and gas flowing.

EPSI:In that regard do you think Ugandans are

prepared to take full advantage of auxiliary industries to this sector?

FKK:No country can at the beginning of its oil and

gas industry development fully provide all the goods and services required. Even developed countries like Norway took time to take charge of their oil industry.

EPSI:What opportunities are there for Ugandans to

take advantage of?FKK:You have got technical services like drilling

operations and engineering services. Those ones require specialized companies which are well established in the industry like Baker Hughes, Phillips and so on. Ugandans can be employed by them or have shares in those specialized companies.

You have got where you provide direct services to the industry like catering, road construction, transportation, communication and security. Ugandans should be able to benefit from providing these services.

EPSI:Moving away from oil, can you throw some

light on the fact that Karamoja one of the most mineral resource rich parts of our country

does not have an aerial mineral survey readily available to the public?

FKK:This survey is important and has to be done. We

were in intensive talks to get it done by the time I left, I trust it will be done quickly.

EPSI:You served under several Ministers what were

the biggest challenges in balancing the political needs vis a vis the technical and professional needs of the Ministry?

FKK:Everybody wants someone who is

knowledgeable, even if you are my enemy. We might not share a cup of coffee, but you will like my well prepared paper I have prepared. Somehow with long experience, it is easy for me to turn any technical paper into a product a politician can consume. That is why I think I had very many minister sometimes we agreed and other occasions disagreed but on the substance we were on the same page.

EPSI:What do you wish to do with the vast experience

and knowledge you have acquired over the years? We have heard that advising the President is not a full time job, where are we going to find Dr Kabagambe Kaliisa in the future?

FKK:When the President needs my advice I shall

give it to him since I actually have a contract as a Senior Presidential Advisor.

But I am an entrepreneur in my own right. If one wants to find me, they can come to Miika Eco Resort Hotel here in Hoima Municipality, which I have painstakingly developed during my weekends for the past six or so years. Right now I am trying to integrate my eucalyptus and matooke farm near Nyakabingo Waterfalls, 10 kilometers on the road from Hoima to Kinyara Sugar Factory. The area around Nyakabingo Waterfalls is home to our primate cousins: the chimpanzees and baboons.

EPSI:Any parting shot for the many you groomed at

the Ministry and others who wish to emulate your illustrious professional life?

FKK:The key for success is: Hard Work, Discipline and

Knowledge.


The Projects of the Eastern Africa Power Pool and their implementation

Will Ugandan Projects be ready for the Power Pool?


Oil is one of the resources that has gotten Ugandan as a country into excitement at the prospect of

making a lot of money from the valuable resource. For many years Uganda has imported oil from various countries and many companies have transported this oil into the country to their different petroleum stations. According to an article by Petroleum Resources in Uganda, about 90% of Uganda’s petroleum imports are routed through Kenya with only 10% coming through Tanzania. This is because Uganda is a land locked country and there is no local production of petroleum products like fuels in the country.

Statistics show that oil products consumption in the country has risen over the years. The same article shows that as of 2007, consumption of petroleum in Uganda stood at 800,000 m3 per annum growing at about 6% per annum since 1997. The petroleum import bill stands at US$ 250 million per year. This constitutes about 8% of total national imports and represents slightly above 20% of total export earnings.

All these expenses on oil products could be reduced if Uganda starts production of oil within its borders under good management. This will be a good start for the country’s economy but this is not the major problem and will not be achieved if certain loop holes in the regulation of supply of petroleum in Uganda are not looked into. The Ministry of Energy and Mineral Development is in charge of regulating the supply of petroleum products in Uganda.

There are various sub sectors under this Ministry which include Power, Petroleum, Atomic Energy and New and Renewable sources of energy for the country. In this case am focusing on the Petroleum sub sector. According to the Energy Policy for Uganda by Electricity Regulatory Authority, the petroleum subsector covers both upstream and downstream industries.

The upstream industry deals with exploration, development and eventual production of various petroleum products while the downstream covers transportation of both crude and refined

products, refining, storage, distribution and marketing of petroleum products. The Petroleum Exploration and Production Act of 1985 and the Petroleum Exploration and Production Conduct of Exploration Operations Regulations of 1993 regulate upstream activities. The downstream industry is governed by the Petroleum Act of 1964 and several Regulations made there under. The most prospective part for petroleum exploitation in the country is the Albertine Graben located in the Western Rift Valley area of Western Uganda. An article titled Petroleum Resources in Uganda highlights that there are 40 licensed oil-marketing companies in Uganda of which 25 are in operation.

Uganda has a national oil company that was started in 2015. The country also maintains fuel reserves at Jinja in Eastern Uganda for strategic purposes also offering temporary storage accommodation at its Jinja Storage Tanks as an incentive to the newly licensed oil companies to encourage competition. This article states these as some of the problems that the petroleum downstream industry is facing, they

affect exploitation of fossil fuels, but these also affect regulation of supply of petroleum in Uganda; Inadequate institutional and legal framework to regulate the petroleum supply industry, resulting in lack of competition and transparency, Significant smuggling of petroleum products along the borders, Low storage private capacity compared to national requirements, Lack of quality control of the oil products, posing an increasing hazard to public health and the environment, High transport costs and high margins by oil companies.

The petroleum Act 2009 states that any commercial activity involving petroleum products which are not in compliance with the quality standards established under the Act or other laws; (2) A holder of a permit or license shall inform the Commissioner within twenty four hours in case of accidents, natural disasters or any other event which has caused or could cause a sustained interruption or substantial reduction of the petroleum

source: wpcluster.dctdigital.com Fuel Plant

Who is who?Petrol

Regulation Of Supply Of Petroleum In Uganda. Nazzinda Denise


Sourec; chimp reports Hass Fuel station Depot in Kyengera

supply operations or which causes or poses the risk of causing major damage to the occupational health, public safety or the environment.

This led to the death of more than one hundred and fifty in the areas around the gas station. According to BBC’s online publications, a survivor named Yaw Aforve said he was sleeping in his car at the petrol station when he heard the fire. He said he jumped into the floodwaters and when he came up for air, the fire burnt his face. “I was swept away by the water to the other side [of the road],” he added. “I saw so many people screaming and shouting.” The question is what Uganda can do to prevent such an incident from happening to its citizens as well.

This occurrence brings about the issue of location of various petroleum stations, are they in the right areas and do they have safety to prevent and contain emergencies that can erupt into explosions since petroleum is a highly flammable resource as much as it can generate s lot of income for citizens and revenue for the Ugandan government. In an area like Bwaise in Kampala there are over three petroleum stations less than one hundred meters apart and some of them are next to residential areas and commercial buidings.

In 2016 Hass petroleum station a major fuel supplier in Uganda was taken to court by a company named Legal Care over the location of its mass storage fuel depot in Kyengera along Kampala- Mbarara road in a densely populated slum area. Another station is Mogas which has a depot in Banda along Jinja road. This brings one to wonder as to whether the Ugandan authorities did not inspect the areas in which these companies choose to put their depots, or did they inspect the areas but chose to ignore the dense population which could pause a security threat if the depots explode and catch fire killing many Ugandans.

Hass Fuel Station Depot in Kyengera along the

Kampala Mbarara HighwayPhoto by Chimp ReportsOne should take location of petroleum stores

and stations into consideration because it could become a problem in case of an emergency. Delhphine Mukeshimana’s thesis titled “Uganda’s Oil Discovery: Nature’s Blessing or a Curse in the Making?” brings out the fact that Uganda’s oil reserves are located in districts that either neighbor or partially overlap with territories formerly plagued by rebel groups. Between 1996 and 2003, the Rwenzori region (block 4B in Appendix 2) along the south-western border with DRC was home to the Allied Democratic Forces-National Army for the Liberation of Uganda (ADF-NALU).

There are various laws in Uganda that consider this issue but there is still a step to be taken to ensure total safety while using petroleum. Government has tabled bills and laws to curb problems of regulation of petroleum such as, the petroleum (exploration, development and production) bill, 2012 which states that (1) Petroleum activities in, on or under any land or waters in Uganda or subject to Ugandan jurisdiction, shall not be conducted without an

authorization, license, permit or approval issued in accordance with this Act. (2) A person who contravenes subsection (1) commits an offence and is liable on conviction. (a) if an individual, to a fine not exceeding ten thousand currency points or imprisonment not exceeding ten years or both; and (b) if a body corporate, to a fine not exceeding one hundred thousand currency points.

Certain cases do not even involve gas stations but individuals who have gotten access to petroleum products and used them to carry out horrible acts like arson and man slaughter or murder.

The Uganda Oil Board Act states some of the functions of the oil board as to operate and maintain storage facilities; to procure and transport petroleum products to wherever such products are needed whether within Uganda or elsewhere; to provide, maintain, operate, control or assist in the provision, maintenance, operation or control of storage and handling facilities; to market and distribute petroleum products to the Government and its agencies and any other person; to import petroleum products and to export such products to other countries; and to establish refineries for refining crude petroleum products which are for importing purposes. This board is in charge of charge of the supply of petroleum in the country and so should be able to prevent the wrong people from attaining this resource for unlawful practices like arson, terrorism and many others.

Such cases make people question their safety around those that store these products and also the regulators in charge of preventing such cases from happening. The problem is one cannot know for sure whether a person is procuring these products for the right purposes. I can simply buy petroleum under the pretext of using it for my generator and instead use it to fire up a building or any other bad activity. The other issue is transportation of petroleum products, many companies transport their products in oil tanks that use the same roads as the general public in very densely populated areas, that is an area that the government of Uganda should also discuss and strengthen safety of the citizens and also ensure that losses of lives and money are not made due to road carnage.

An example is an accident that happened in Kenya in 2009 involving an oil tanker, according to the Telegram, an online media publication more than two hundred people were injured in the scuffle for oil and others died, thirty three of those air lifted to Nairobi because fifteen to thirty


Uganda should be able to learn from its neighbor and avoid such problems. The discovery of oil in the country creates more work for regulators to strengthen and revise the current laws in order to ensure safety of the Ugandan citizens since many people will want to engage in the business in order to get a better living and also better the economy of the country.

The various problems have been mentioned but solving them is what will take Uganda’s petroleum industry ahead into development especially when it comes to supply and storage. Some of the solutions to these problems are already being put into play ,according to (Joseph, et al,2015) in a report titled “Disaster risk management and oil production in Uganda” are Education, advocacy and sensitization programmes relating to DRR are ongoing. Efforts shored up by some oil companies like Total Oil and Tullow in offering study studentships in some areas where the oil exploitation will take place are commended. On the other hand, they sensitize people on risk and safety and no doubt it inculcates local people’s disaster preparedness and response as well as ensuring healthy environments (New Vision: March 25th, 2014).

He adds that the Government of Uganda should mandate all business and non-business entities to have a well-documented and feasible Emergency Action Planning (EAP). It should infer to stringent prevention, preparedness, response and recovery measures for any hazards and disaster risks they are vulnerable to. Domestic and international legalities promulgated in aftermath of HFA should be matched with HFA priorities and indicators and re-enforced in ways that may deem possible other than remaining a fantasy on paper.

In conclusion the Government of Uganda should revise the petroleum laws to curb unlawful petroleum supply including smuggling of these products inside and outside the country and also ensure safety of its citizens as well as support development of the sector.

References 1.Delphine Mukeshimana, Uganda’s

Oil Discovery: Nature’s Blessing or a Curse in the Making? Understanding Domestic Stability Risks of the Newly Discovered Oil in Uganda. (Master’s Thesis) University of Groninge

2.Dozens killed in Kenya oil tanker fire as people scramble for free fuel – Telegraph

www.telegraph.co.uk >… > Kenya3. Ghana petrol station inferno kills

about 150 in ACCRA – bbc Newswww.bbc.com > world-

africa-330036734.Hass Petroleum in Trouble Over

Kyengera Fuel Depot | - Chimp Reports

www.chimpreports.com > hass-petroleum…

5HOW ONE MAY ACQUIRE PETROLEUM CONSTRUCTION PERMIT IN UGANDA…

https://okumumartin.wordpress.com > ho…

6.JK Balikudembe & Ardalan Ali, 2014.DISASTER RISK MANAGEMENT AND OIL PRODUCTION IN UGANDA: NEED FOR A…

www.preventionweb.net > bgdocs > inputs

7. Petroleum Resources in Uganda- energypedia.info

https://energypedia.info > wiki > Petroleu…

8.Petroleum Supply Regulations 2009- Ministry of Energy & Mineral Development (PDF)

energyandminerals.go.ug >

downloads9. THE ENERGY POLICY FOR

UGANDA- Electricity Regulatory Authority (PDF)

www.era.or.ug > policies > doc_download

10.THE PETROLEUM SUPPLY ACT, 2003. - EI

www.eisourcebook.org >cms > Uganda…

11. Uganda National Oil and Gas Policy

12.Uganda Oil Board Act13.Uganda Petroleum Exploration

development and Production Bill 2012

source: ABC news One of the vehicles destroyed in the oiltank accident in Kenya


Karuma Dam; Will It See Light Of Day? Samuel Sebbowa

The construction of the dam and power station

Will Ugandan Projects be ready for the Power Pool?


Uganda currently has 862 MW of installed electricity generation capacity. In his budget speech of June 8, 2016, Finance minister Matia Kasaija indicated that

electricity access is currently at 20.4 per cent, meaning more than 25 million Ugandans lack access to electricity. And with the completion of the Karuma Dam this 862 MW will become 1462MW without the other numerous projects being added to the grid yet.

Such a triumph for the energy sector of Uganda raises questions amongst Ugandans such Mr. Kalyango Eddy who says that what will be the purpose of an additional 600MW when the already existing 862 MW are not being fully utilized by Ugandans. This shop owner in Kyanja, Kampala believes that making the entire 862 MW accessible to all Ugandans is a better start than aiming to finish all hydroelectric dam projects.

But regardless of the sentiments of some Ugandans like Eddy, the government of Uganda continues to ensure that the Karuma power station located along the River Nile at the point where the Masindi – Gulu highway cross the River Nile. Initially, Norpak, a Norwegian energy company, was awarded the contract to perform the feasibility study and the environmental impact assessment (EIA) for the dam. In 2006, Norpak made the feasibility report available and it was time to start construction.

Initially, the government planned to construct a dam that had a generation capacity between 200 and 250 MW. However in 2009, the plans were revised with aim of constructing a much larger 750 MW dam to provide more electricity to the Ugandan national grid. The government of Uganda contracted Energy Infratech Private Limited to perform a new feasibility study and a new EIA, given that a larger power station was being planned.

However these plans took the first of many significant hits when in 2009 Norpak, which was in negotiations to take a lead in construction of the dam, pulled out. Their pull out was blamed on the global recession that took place between 2008 and 2012. This also put a halt to government’s plans to construct the dam for 6 years starting in 2012, and ending in 2018. Regardless of this pull out, the government of Uganda continued with its feasibility study, as the World Bank had promised to provide Uganda with some of the funds to construct the major dam.

In January 2011, Energy Infratech Private Limited, the Indian company contracted to perform the feasibility study for the project, said the estimated total cost for the dam and power plant was approximately US $2.2 billion, which included the cost needed to build a transmission line from Karuma to a location where the power will be integrated into the national power grid. Furthermore, the construction costs for the high voltage transmission lines were also estimated to be above US$200 million.

With 2012 fast approaching and passing by, as has become the norm in Uganda, the construction contract was awarded to Sinohydro, a Chinese construction company in June 2013, more than a year later than what the government had initially hoped for. In June 2014, the Chinese Exim Bank committed in writing to fund 85 percent of the construction costs, in the form of a concessionary loan repayable in five years. The Ugandan government was meant to pay the remaining 15 percent of the cost for the construction of the dam. This was after the World Bank’s promises could not fully be relied on.

The construction of the dam and power station officially started on 12 August 2013 with use of the loan acquired from the Chinese Exim Bank.

A few years ago on March 2015, the Ugandan Parliament assented to two loans totalling up to US$1.435 billion, from the Export-Import (EXIM) Bank of China, for the construction of the power station. Of that amount, US$789.3 million will be loaned at 2 percent per annum, repayable over 20 years, while US$645.82 million will attract 4 percent interest, payable over 15 years, effective the day the dam is fully commissioned. Of the total sum already gathered, Uganda has already invested over US$250 million in the construction of Karuma dam.

With construction well underway, Sinohydro the Picture Source; The Independent Karuma dam construction site

Who is who?Karuma Dam

source: ABC news One of the vehicles destroyed in the oiltank accident in Kenya


lead contractor on the project, contracted with Alstom to provide equipment and technical services to the power station, in a deal worth US$65 million. In March 2016 with about 30 percent of the work complete on Karuma dam having been finished the Minister of Energy and Mineral Development decided to pay a visit to the dam. She did this in April and having seen cracks in the spillway of the dam, she called for a halt in the work.

Sinohydro subsequently dispatched a team of Experts led by Mr. Yang Yixin to carry out detailed investigations on this matter. What followed this investigation, was a team of dam construction experts from Sinohydro Corporation conceded to the defects in the laying of concrete works at Karuma hydro power station even if they argue that the resulting cracks on the spillway will have no impact on the overall functionality of the 600MW power station. In a report submitted to Uganda Electrcity Generation Company Limited (UEGCL), the team of experts that consulted widely with specialists in design and construction of concrete works concluded that the cracks which led to a four week pause in the works are just common cracks in the construction industry “which are remediable and therefore won’t affect the overall functionality of the dam.”

A statement released to media however suggests negligence and defective works saying, “the experts in a course of three weeks worked in conjunction with over 30 specialists in design and construction of concrete works on the ground and in China to analyse the causes of cracks and formulate remedial measures for the treatment and draft preventative/improvement measures to be adopted in concrete works construction based on the study of the drilled cores and construction methodologies.”

However, according to some independent experts, the cracks in the spillway were most likely the result of Sinohydro neglecting basic procedures in managing the temperature of the concrete mixture during construction. Because cement generates heat when it reacts with water, it is a basic procedure for constructors of major civil works in high ambient temperature environments such as Uganda to preclude cracking by using ice to mix the concrete.

With all this going on, President Museveni instituted a Project Steering Committee headed by the former chairman of the Independent Electoral Commission; Dr Badru Kiggundu to oversee the construction of what will be Uganda’s largest hydroelectric dam.

Kiggundu is deputised by John Berry, the former General Manager, Bujagali Electricity Limited. The other members of the committee include the Permanent Secretaries of the Finance and Energy Ministries and the heads of UEGCL and UETCL; and the Solicitor General.

During this Project Steering Committee’s fact finding visit to Karuma dam in November, Wang Yantao, the Executive Vice President, East and Southern Africa, Sinohydro Corporation said that about 20 experts had come in from China to work on the challenges facing the project, which he said was very unique and important to them (Sinohydro). He also acknowledged that they had had challenges and pledged to work with the government to correct them. All this was during a press conference attended by journalists at the site.

Another official from Sinohydro explained that they had checked the cracks, found that they were not deep, were on the spill way and not the power house, which is the heart of the dam. He said that they had hired SIKA, a company from Switzerland to repair these cracks. Pressed on whether patching up the cracks would not reduce the dam’s life, the official reassured the meeting that the chemical being used to treat the cracks was even stronger and more durable than the concrete.

When Ugandans hear about such things they get worried that Karuma Dam will not deliver as promised. Ms. Peace Nabulya, believes that Karuma Dam will not be as effective as either Bujagali or the Nalubale dams. “I believe that with things like cracks appearing, Uganda will waste more money repairing the dam’s problems than actually generating enough electricity.

Other Ugandans like Mr. Arnold Wasiike praised the government for finding fault with the work of Sinohydro and calling them to book before any further damage had been done. “At one point or the

other, the government has to be praised. Hopefully this action will deter these foreign companies from trying to make more money from our projects.”

But there was a question that some Ugandans raised when they were told about the problems of Karuma Dam and the stalling of the work. “Who is going to pay for the lost time and repair works?”

That was a question answered back in November 2016 during a press conference at Karuma. Mr Yantao flanked by Badru Kiggundu, said they (Sinohydor) will foot the bills because they have so far spent only 40 per cent of the total project cost, and save for the cracks, the rest of the work is perfect. He went on to explain that they valued the project in Uganda. “This project is very important to us because it is unique, it is the first of its kind for us in Uganda and Africa, the rock is very good, the foundation is good and the concrete work is excellent.”

With the Parliament of Uganda eager to ask questions about the cracks on Karuma dam, the Attorney General was forced to put a stop to their actions. Some Ugandans like Collin Mukisa believe that such actions mean the government was in on the poor construction works being done by the government. “Why stop parliament? Even Museveni warned the MPs to leave Karuma matters alone. There must be something we are not being told…”

The government of Uganda has had plans for the construction of Karuma Dams from about 1995. This was one of President Yoweri Kaguta Museveni’s flagship projects in the then growing energy industry at the time. Fast forward to 2017 and Karuma Dam is not near completion being surrounded by endless tales of corruption and shoddy work. With an expected commissioning date of 2018, will this dam that has been on hold for over twenty years see the light of day and will it benefit Ugandans?

Oversight visit to Karuma Dam construction Site


Thermal Electricity Generation Plants Come To The Rescue As Effects Of Drought Hit Hard

As the saying goes “every dog has its day.” The often maligned fossil fuel generation (thermal) plants in the region have brought a smile to the faces of

the power supply system operators in Uganda and Kenya since February 2017 to now. The last half of 2016 has witnessed insufficient rainfall in the region especially in Western Kenya and most of Uganda. As a result the limited and much-loved hydropower plants received lower water inflows than usual; hence the greatly reduced power generation capacity that has in fact left some of these plants actually closed.

Thanks to the foresight of some few power planners, who in spite of severe criticism have insisted on maintaining the so called expensive thermal plants in the regional networks, commerce and industry continue running normally up to today (mid-April 2017). This is because the usually in stand-by mode thermal plants are dispatched at full capacity to meet the shortfall. Without these thermals the shortfall would have had significant impact on power availability in Uganda and especially Kenya.

The drought effects were more severe in Kenya. In Kenya, the spare capacity in the installed 2341MW is normally cut to the minimum and got wiped out quickly compared to Uganda, whose installed capacity is 840MW while peak demand is around 540MW. Thus after exhausting all its installed operational capacity, Kenya had to negotiate with Uganda for its excess capacity. Since Uganda’s hydro resource had also been affected by the drought, it could only sale to its eastern neighbor energy from its previously idling thermal plants at Namanve (Jacobsen) and Tororo (Electromaxx).

We should point out that the worst affected part of Kenya was its western areas with the limited hydro being hit harder by challenges in the transmission capacity (cable carrying capacity and transmission losses) from the eastern side of the country to serve the west.

As luck would have it, transmission losses from the two Ugandan thermal plants especially Electromaxx are much lower when serving western Kenya due to shorter distances. Also the Lethos to Tororo transmission network received enhancement carrying capacity and rehabilitation not so long ago.

Thermal Generation Capacity in Uganda and KenyaAs said before Uganda has only two fully available

thermal plants: Electromaxx (U) Limited 70MW (50MW licensed and operational) at Tororo about 240km east of the capital Kampala and Jacobsen Uganda Power Plant 50MW at Namanve about 10Km east of Kampala. Both depend on Heavy Fuel Oil (HFO). This is cheaper than the diesel thermal (Aggreko) which Uganda hired back in 2005/8 when it was caught unawares by drought before it diversified from hydro dependence.

These are augmented by about 60MW (50% of the 120MW) availed to the national grid by the five sugar producing firms in Uganda. These firms co-generate electricity from sugar cane bagasse. The sugar companies retain the balance 60MW for their internal use. This is a relief to the national grid but seasonal in line with the sugar cane harvest period.

Kenya on the other hand boasts of about 8 hydropower plants contributing about 57% (780MW) to the country’s installed capacity with rest coming from several resources; Heavy Fuel Oil and Biogas, Geothermal, wind and solar. Kenya has 6 traditional Thermals (HFO) plants adding up to 504MW plus 2 Biomass plants contributing 13.4MW. This is in addition to 256MW from geothermal resources that Kenya deployed before turning to its neighbor for support.

However while Uganda continues with its focus on single supply from hydro (it is more than doubling its installed capacity in next two years: Karuma, Isimba and numerous mini hydro projects), Kenya is focusing on diversified supply. More geothermal (Okalia 4), more wind (Turkan Wind Farm) and solar. This strategy is likely to ensure an “all weather” power supply system for Kenya preparing itself for other droughts; and given time these will occur perhaps with more severity arising from global warming. And unless Uganda changes course and seriously considers diversification the tables will be reversed with Uganda importing from Kenya.

Other Considerations in Deployment of Thermal Plants

For Kenya and in spite of falling HFO prices, there was need to increase the Fuel Cost Levy in the power tariff by 25% from US Dollar Cents 2.8 to US Dollar cents 3.5 per kWh in February 2017 to date. Uganda gaining from windfall revenue from selling to Kenya, the lower fuel prices and small component of thermal in its domestic power mix, has avoided increases and actually declared a tariff reduction mid-April 2017.

Both Uganda and Kenya HFO operators seem to have been caught unawares by major leap in the thermal demand. Ramping up generation from the spinning reserve levels to full capacity called to equal escalation of fuel supply chain operations which at some point in time strained them. At one point in March 2017 the whole East African region ran out of HFO as orders on the high seas mobilized in February had not arrived into storage at the Mombasa Port.

Also emergency payment arrangements for fuel supplied and used but not yet paid for by power off-takers. All these tested the thermal power supply system as a worthy backup arrangement.

ConclusionIt is undeniable that thermal power plants are

going to be an important component of the power supply system for Uganda and Kenya. Presently the two neighboring countries are supporting each other with energy supply for much needed cash to cushion revenues streams.

Therefore, Kenya, by intensifying its diversification program, seems to be taking a more strategic path than Uganda.

However, both need to put in place arrangements that will avoid tariff escalation and logistical nightmares when the drought strikes and thermals are called into full deployment.

Eng Frank B Sebbowa, PhD


Who is who?Energy

Energy And The National Development Plan II

The Second National Development Plan (NDPII) runs from 2015/16 to 2019/20 and has a two-pronged theme. Uganda Vision

2040 is “transforming Ugandan society from peasant to a modern prosperous country with 30 years. The NDPII theme is “strengthening Uganda’s competitiveness for sustainable wealth creation, employment and inclusive growth”.

Energy is critical to both these themes and has been given considerable coverage in the plan. This is under the minerals, oil and gas and infrastructure development. The core projects under these two energy categories are shown below.

Oil and Gas Priority Areas

Hydro Electric Power

Hoima refinery Karuma hydro power plant

Oil-related infrastructure projects

Isimba hydro power plant

Albertine region airport Industrial substations

Albertine region roads Ayago hydro power plant

Pipeline Grid Extension in North East, Central, Lira and Buvuma Islands

Other oil-related support infrastructure

Masaka-Mbarara transmission Line

Kabale-Mirama transmission line

Grid extensions including those for the regional power pool

Key interventions in energy to drive growth are•Increasing the transmission voltage from 66kV

and 132kV to 220kV and 400kV•Increasing the transmission network coverage •Increasing the number of substations•Rural electrification drive.

In order to make these interventions it has been projected that government will invest about 3% of the country’s development expenditure on energy for the next five years. This is about Ugx 16.455 trillion over the life of the NDPII.

Uganda’s energy policy, which was drawn up in 2002 noted that despite an abundance of energy resources, especially hydrological and other renewable resources, energy poverty remained

widespread. There are several causes of the widespread energy poverty and these include the following.

•Limited planning for energy supply which has been limited to urban and semi-urban areas

•Inadequate and inefficient supply arising from slow growth in generation, transmission and distribution capacity, relative to population

•Low incomes that imply that clean energy remains unaffordable by the majority of the population, which is also rural

•Institutional and legal weaknesses regarding energy development and conservation.

In recognition of these constraints, NDP II was specifically crafted to increase investment in the energy sector in such a manner as would enhance social and economic development in an environmentally sustainable manner. Despite these efforts and investments that have been made, Uganda’s energy consumption statistics remain some of the worst in sub-Saharan Africa (see table below).

Based on the 2014 data, only about Uganda’s electrification rate stood at about just 15%. This means that more than 30 million Ugandans did not have access to clean renewable energy. As noted in the Energy Policy 2002, there is a direct relationship between access to power and deforestation rates. The rate of deforestation was also noted as a concern, because as a result of the damage to the environment, Uganda was failing to meet commitments to climate change conventions.

Given the state of affairs, renewable energy investment remains a critical and key issue for Uganda. Efforts to invest in the sector have grown more than four fold since 2002 but because of the gestation period of investment projects, the energy gap remains considerable. Further, the fact that users are always down stream and infrastructure interventions like transmission and distribution are necessary; it will be a while before the energy gap is closed.

Prof. Samuel Sejjaaka


Region Population without electricitymillions

National electrification rate%

Urban electrification rate%

Rural electrification rate%

Africa 622 43% 68% 26%

Sub-Saharan Africa 621 32% 59% 16%

Angola 15 30% 46% 6%

Botswana 1 66% 75% 51%

Côte d’Ivoire 15 26% 42% 8%

Democratic Republic of Congo

60 9% 24% 1%

Ethiopia 70 23% 85% 10%

Ghana 7 72% 90% 52%

Kenya 35 20% 60% 7%

Mauritius 0 100% 100% 100%

Namibia 2 30% 50% 17%

Niger 15 14% 62% 4%

Nigeria 93 45% 55% 35%

Rwanda 10 17% 67% 5%

Somalia 9 15% 33% 4%

South Africa 8 85% 88% 82%

South Sudan 11 1% 4% 0%

Tanzania 36 24% 71% 7%

Uganda 31 15% 55% 7%

Zambia 10 26% 45% 14%

Zimbabwe 8 40% 80% 14%

Electricity access in Selected SS Africa Countries


Consultancy In The Electricity Sector Over The Years. Dr. Abel Katahoire Ph.D., P. Eng

The role of the Consultant to the consumers in the electricity sector was to develop designs and documentation through studies to address the Client’s needs with regard to the electrical installation requirements.

This is right from the interface with the electricity supply network up to and including the utilization point.

Grid electric power in Uganda is traced back to 1954. It was when the first run of the river hydro turbine was switched on under the then colonial government. This government had earlier setup an implementing agency, the Uganda Electricity Board (UEB). The Board was responsible for generation, transmission, distribution, supply and regulation of the sector. At the time, during those early years of electrification, the Board developed internal capacity to deal with planning and implementation of the electrification of mainly urban areas.

In such circumstance the Board rarely needed to hire external independent professional expertise.

Following the events which took place in the 1970’s a lot of people left the country, some voluntarily others having been forced out. The internal war in 1979 also meant that the Board, like most institutions at the time, was not able to cope with maintenance and expansion requirements of the sector.

Lack of regular proper maintenance over many years during the period 1973 – 1988 resulted in near collapse of the infrastructure from generation up to supply connection points to consumers. Up to this period the role of experts or experienced professionals (Consultants) in the electricity sector in the country was generally and mainly with the consumer. This was because the utility agency (UEB) had internal capacity to handle performance and expansion studies as well as construction services.

1984/2000 : Rehabilitation of the SectorDuring the mid-eighties, government made

appeals to different funding agencies to come on board in the effort of rehabilitating, overhauling and expanding the electricity sector from generating stations through transmission and distribution networks.

Through international bidding Consultants were engaged to carry out various studies such as:-

a)System studies to determine condition and remedial action

b)Demand studiesc)Expansion and system upgraded)Standard specification for system design and

constructione)Design and supervision of selected system upgrade

interconnection and sub-stations f)Electricity tariff

1999 : Energy PolicyIn order to address the then prevalent inadequate

and inefficient electric power supply system, arising from stunted generation capacity growth, poor transmission and distribution infrastructure as well as un-business like and poor utility commercial practices by the then sole operator in the sector, government put into place institutional and legal innervations to address these short comings as well as manage the demand side. Government approved an energy policy whose goal was:

“To Meet the Energy Needs of Uganda’s Population for Social and Economic Development in an Environmentally Sustainable Manner”.

The policy had a number of objectives but two of them have specifically resulted in increased provision of Consultancy services in the electricity sector since 1999. These two objectives are:

Objective 1: “To establish the availability, potential and demand of the various resources in the country”.

1999 : Energy Policy

Consultancy opportunities


Consultancy

Source Internet: technician repairing the transfomer.


Source Internet: Over sight of a power plant

Objective 2: “To increase access to modern affordable and reliable energy services a contribution to poverty eradication”

Consequently UEB, the then sole national utility company lost monopoly in the sector (unbundled). Three different business entities were created for generation Uganda Electricity Generating Company Limited (UEGCL), for transmission, Uganda Electricity Transmission Company Limited (UETCL), and for distribution, Uganda Electricity Distribution Company Limited (UEDCL), as well as a sector regulator, the Electricity Regulatory Authority (ERA).

While UEGCL and UEDCL have been leased out to private operators on long term concession arrangements, UETCL remains a public entity in the medium term and in all cases the assets remain under public ownership.

From the paradigm shift to diversification of sources of electricity, involvement of private capital, competition, new markets, and the demand for Consultancy services in the electricity sector has been on the increase since.

Consultancy opportunities have arisen in the associated areas, such as:-

a)Studies in setting up and operationalizing of structures for implementing the policy objectives, such as the Rural Electrification Board.

b)Studies to establish availability, potential and demand of some sites for alternative sources of electricity (micro-, mini- and large-hydro generating stations), solar PV etc

c)Studies involving evacuation of the generated power to the national grid as well as the interconnection requirements

d)Studies on strategies and plans for accelerating access to electricity in rural areas.

e)Feasibility studies for distribution and electricity supply to various institutions (administrative, health, educational) and commercial centres all over the country.

f)Supervision of Construction of various rural electrification lines and associated substations

g)Efficient and economic use and costing of electricity

Since 2001, the government has been able to raise funds for rural electrification and has been able to attract bilateral funding to hit the target of raising access to electricity from 5% to 22% of the population by 2022. Therefore the demand for Consultancy services in the electricity sector is likely to continue increasing for the generation, transmission and distribution side, as well as the attendant demand side.

Uganda Electricity Generation Company Limited (UEGCL) Gearing On To Greater Heights

UEGCL

UEGCL COMPANY PROFILEUEGCL was incorporated on 26th March 2001 under the

Companies Act (Cap 110), the Laws of Uganda and in conformity with the Electricity Act, 1999 and started operation on 1st April 2001. The mandate of UEGCL is to establish, acquire, maintain and operate electricity generation facilities and to promote Research and Development in the Electricity generation sector while running the company on sound business principals.

VisionThe Vision of UEGCL is to “Be the Leading Power Producer in

the Great Lakes Region”.

MissionUEGCL’s Mission is to “Sustainably Generate Reliable, Quality

and affordable Electricity for Socio- Economic Development”.In line with the Vision 2040 and NDP II aspirations of having

a more competitive economy, Government of Uganda has re-defined UEGCL’s mandate to include: Implementation and later Operation & Maintenance of both GoU flagship Hydro Power Projects and own Projects, in addition to concession monitoring

2. UEGCL Strategic Direction (2015-2017)The company’s activities are currently guided by a three

year Strategic Direction (2015-2017) whose key objectives are premised on the four balance score card perspectives namely the Internal Business Processes, Financial, Customer and Learning and Growth. The Strategic Direction is aimed at contributing towards the national agenda of transforming Uganda into a middle Income Status, and is committed to increase generation installed capacity (for Hydro power) from the current 853 MW to 1686 MW by 2020.

UEGCL is currently undergoing a number of structural and functional changes as it positions itself to meet the expectations of the population of Uganda, and the following are the Company’s Strategic Focus Areas.

3 UEGCL’s Core Focus AreasThe following are UEGCL’s Focus areas aimed at contributing

towards transforming Uganda into middle income status.

i) Hydropower Management and Development.In regard to the core business UEGCL’s is focusing on the area of

efficient Hydropower Management and Development as follows

1. Operation & Maintenance of the Karuma and Isimba Hydropower Plants

2. Capacity Building for Operations and Maintenance

3. Capacity Development to Manage the Cascade of Hydropower Plants along the Nile

4. Professional Services Unit

5. ISO Certification

6. Resource Mobilization for Project DevelopmentAll the above initiatives are aimed at putting UEGCL on a new

platform of growth and development, which in turn translate into sustainable and affordable electricity to the Ugandan Economy at large, and the socio-economic transformation of the people of Uganda.

UEGCL’s Mission is to “Sustainably Generate Reliable, Quality and affordable Electricity for Socio- Economic Development”.

Dr. Eng. Harrison. E. Mutikanga UEGCL’s CEO(left) exchanges an MoU with Prof, Ddumba Sentamu Makerere University Vice Chancellor(right) to partner and build capacity

BLOCK C, VICTORIA OFFICE PARK, PLOT 6-9 OKOT CLOSE BUKOTO,

P.O. BOX 75831, KAMPALA, UGANDA

TEL. +256 312 372165Email: [email protected]: www.uegcl.com

LOCATION



Karuma project Manager Albert BYARUHANGA explains architecural designs and the project progress to the Board chairperson Eng.Proscovia Margaret NJUKI and her team

Isimba Hydro Power Project progress


Pictorial

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1. Construction Site for Karuma Hydro Electric Dam

2. Crack along Spillway of Karuma Dam

3. Former Ferdsult Engineering Services Ltd (FESDL) Team working for UEDCL now

4. Handover of FESDL operations to UEDCL

5. Dr. Kabagambe meeting Dr. Sebbowa in Hoima

6. Isimba Dam construction site

7. Kayonza Tea Factory

8. Artistic Impression of Karuma Dam

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Suite 404 Fourth Floor, BMK House (near Hotel Africana)Wampewo Avenue - Kololo, Kampala

Tel: +256 393 217 066, +256 750 950 145P.O. Box 72030, Kampala - Uganda

Email: [email protected]

Address:

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