Uganda Energy Situation

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Uganda

Capital:

Kampala

Region:

Coordinates:

1.0667° N, 31.8833° E

Total Area (km²): It includes a country's total area, including areas under inland bodies of water and some coastal waterways.

241,550

Population: It is based on the de facto definition of population, which counts all residents regardless of legal status or citizenship--except for refugees not permanently settled in the country of asylum, who are generally considered part of the population of their country of origin.

47,249,585 (2022)

Rural Population (% of total population): It refers to people living in rural areas as defined by national statistical offices. It is calculated as the difference between total population and urban population.

74 (2022)

GDP (current US$): It is the sum of gross value added by all resident producers in the economy plus any product taxes and minus any subsidies not included in the value of the products. It is calculated without making deductions for depreciation of fabricated assets or for depletion and degradation of natural resources.

45,567,304,608 (2022)

GDP Per Capita (current US$): It is gross domestic product divided by midyear population

964.40 (2022)

Access to Electricity (% of population): It is the percentage of population with access to electricity.

45.22 (2021)

Energy Imports Net (% of energy use): It is estimated as energy use less production, both measured in oil equivalents. A negative value indicates that the country is a net exporter. Energy use refers to use of primary energy before transformation to other end-use fuels, which is equal to indigenous production plus imports and stock changes, minus exports and fuels supplied to ships and aircraft engaged in international transport.

no data

Fossil Fuel Energy Consumption (% of total): It comprises coal, oil, petroleum, and natural gas products.

no data

Source: World Bank

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Energy situation

Uganda has a total primary energy consumption of 0.0593 quadrillion Btu which equals 14.94 Mio. tons of oil equivalent (2012). Biomass is still the most important source of energy for the majority of the Ugandan population. About 90% of the total primary energy consumption is generated through biomass, which can be separated in firewood (78.6%), charcoal (5.6%) and crop residues (4.7%). Electricity is contributing only 1.4% to the national energy balance while oil products, which are mainly used for vehicles and thermal power plants, account for the remaining 9.7%. Concerning electricity generation, Uganda has an installed capacity of 822 MW, mostly consisting of hydropower (692 MW; 84%). Access to electricity in 2013 at national level in Uganda is very low with 15% (1991: 5.6%; 2006: 9%; 2010: 10%) but only 7% in rural areas. Uganda currently has one of the lowest per capita electricity consumption in the world with 215 kWh per capita per year (Sub-Saharan Africa’s average: 552 kWh per capita, World average: 2,975 per capita). Uganda politically and economically reformed its energy sector including a new legal and regulatory framework based on which the previously vertically integrated monopoly, Uganda Electricity Board, was unbundled leading to public private partnerships. The Government provides an enabling environment for private sector investments in generation and distribution of electricity while transmission above 33kV remains a public function through the Uganda Electricity Transmission Company Ltd (UETCL). The Electricity Regulatory Authority (ERA) was established to license and regulate operations of all electricity operators, and the Rural Electrification Agency (REA) was put in place to ensure that rural electrification, which in most cases is not commercially viable, is accelerated to achieve set targets. The energy sector is one of the key sectors of the Ugandan economy. The sector provides a major contribution to the treasury resources from fuel taxes, VAT on electricity, levy on transmission bulk purchases of electricity, license fees and royalties and foreign exchange earnings from power exports. Significant public investment has injected into the sector, particularly in the area of electricity supply. Following liberalisation, the power sub-sector is now attracting the largest private sector investments in the country. The sector is not only a vital input into other sectors, but also major source of employment.

Energy demand

Mainly resulting from a prominent GDP growth of around 6% during the past two decades (2010: 6.2%; 2011: 5.0%; 2012: 4.7%; 2013:6.5%), electricity demand has been growing at an average of 10% per annum. In the past years this lead to occasional load shedding since the supply did not increase proportionally.
The following table shows the energy and electricity demand of the main consuming sectors according to Uganda Energy Balance 2012 of the Ministry of Energy & Mineral Development (MEMD).

Sector	Energy Demand	Electricity Demand
Residential	67.09%	24.24%
Commercial	13.35%	11.16%
Industrial	11.86%	64.60%
Transport	7.25%	0.00%
Agriculture	0,45%	0.00%
Total	100%	100%

Energy supply

In 2012, Uganda had to import energy in the amount of 1,187,672 TOE (different petroleum products) while the amount of exports (only electricity) amounted to 8,514 TOE. Uganda’s main source of energy is biomass. Regarding electrical power generation, hydropower accounts for about 84% of the total installed capacity of 822 MW. The actual total electricity capacity is 550 MW and the country’s peak demand is about 489 MW. According to the NDP the peak power demand is rising about 22.7% per annum. The following table shows Uganda‘s most important power stations.

Plant/Source	Capacity (MW)
Kiira (Large Hydro Power Station)	200
Nalubaale (Large Hydro Power Station)	180
Bujagali (Large Hydro Power Station)	250
Jacobsen Namanve (Thermal Power Plant)	50
Electro-Maxx-Tororo (Thermal Power Plant)	50
Kakira Sugar Works Ltd (Cogeneration)	22
Kinyara sugar Works (Cogeneration)	7.5
Kilembe Mines Ltd (Small Hydro)	5
Tronder Power Bugoye (Small Hydro)	13
Eco Power Ishasha (Small Hydro)	6.5
Africa EMS Mpanga (Small Hydro)	18
Hydromax Buseruka	9
Kasese Cobalt Company Ltd	10.5

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Problem Situation

Wood fuels are largely used for cooking in rural areas while charcoal mostly provides for the cooking needs of the urban population. High demand for wood fuels used inefficiently results in overuse and depletion of forests.. In 2012, 14.1% of Uganda’s land area was covered with forest. The land available is becoming scarce and households prefer to use the land for food crops rather than planting trees. Since 1990 the forested area decreased from 49,240 km² down to 29,880 km². This means that from 1990 until 2010 more than 19,360 km², equaling 39 % of the existing forest disappeared. Currently about 90,000 hectares (equals 900 km²) of forest cover are lost annually, which leads to fuel wood scarcity in rural areas and increasing price levels of charcoal and fuel wood. Between 2005 and 2008 the charcoal price rose at an enormous nominal rate of 14% per year. In addition, illegal cutting of trees increases. The production of charcoal is carried out under primitive conditions with an extremely low efficiency at 10 to 12% on weight-out to weigh-in basis and an efficiency rate on calorific value basis at 22%. At the same time, households use biomass in a very inefficient way as the three-stone fire is still widely spread. Urban and rural households are facing increasing energy costs or spend more time collecting firewood. Furthermore, the traditional use of firewood is responsible for high indoor air pollution levels, thus causing respiratory diseases that affect women and children in particular. Moreover, the latter spend many hours and travel long distances to collect fuel wood. This deprives women of valuable time to engage in income generating activities and children to go to school and study. A total of 93% of rural households without access to electricity are currently using traditional lighting technologies such as candles or kerosene lamps that give poor quality lighting, emit noxious fumes and present hazards in terms of fires or burns (in particular for small children). Furthermore, the majority of social institutions (e.g. schools and health centres) in rural areas do not have access to electricity, which leads to inferior health and education services in comparison to electrified institutions. Lack of access to electricity also severely constrains the economic development of rural areas of Uganda, preventing the establishment of businesses that require electric power or forcing companies to buy diesel or petrol generators that are costly to operate and negatively impact the environment. Furthermore, job creation is being seriously constrained by the lack of adequate investment in the provision of rural infrastructure services, of which electricity is a key component. Lack of electricity also prevents access to information and communication technologies (e.g. mobile phones, computers, internet). This contributes to further isolation of rural areas from the rest of the country. Further, the quality of rural life is hampered by lack of electricity, particularly as rural public institutions such as health, educational and water facilities would be able to provide better services if they had access to electricity.
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Energy resources

Uganda is richly endowed with abundant energy resources, which are fairly distributed throughout the country. These include hydropower, biomass, solar, geothermal, peat and fossil fuels. The energy resource potential of the country includes an estimated 2,000 MW of hydro power, 450 MW of geothermal, 1,650 MW of biomass cogeneration, 460 million tons of biomass standing stock with a sustainable annual yield of 50 million tons, an average of 5.1 kWh/m² of solar energy, and about 250 Mtoe of peat (800 MW). In addition, petroleum in an estimated amount of 6.5 billion barrels, of which 1.4 billion barrels are recoverable, has been discovered in the western part of the country. The overall renewable energy power generation potential is estimated to be 5,300 MW.

Biomass

Biomass is the predominant type of energy used in Uganda, accounting for 94% of the total energy consumption in the country. Charcoal is mainly used in the urban areas while firewood, agro-residues and wood wastes are widely used in the rural areas. Firewood is used mainly on three-stone fires in rural households and in food preparation by commercial vendors in urban areas. Only about 10% of all households use efficient stoves. The same applies to the burning of farm residues. Firewood in some institutions like schools and hospitals is however used on improved stoves. Charcoal is mainly used on a metallic stove traditionally known as a ‘sigiri’ though the use of the clay sigiri is picking up. For the conversion of firewood into charcoal, earth mounds and pits are used as charcoal kilns. These have a wood conversion efficiency of 10 to 12% on weight-out to weight-in basis. This implies that about 9 kg of wood are needed to produce 1 kg of charcoal, which translates into 22% efficiency on an energy output to energy input basis. Introducing improved technologies may increase efficiency to achieve 3 to 4 kg of wood per kg of charcoal, which corresponds to 60% to 50% efficiency respectively on an energy basis. Efforts to train charcoal burners have mainly been unsuccessful as most of them do it on an individual basis. Like in most African countries, research, development and dissemination of efficient and modern biomass technologies are not yet at the desired level.

Biomass potential and distribution

Various sources supply biomass, among them the different vegetation and land use types. The major sources are hardwood plantations, which consist of eucalyptus (50%), pine trees (33%) and cypresses (17%). The total standing biomass stock is stated with 284.1 million tons with a potential sustainable biomass supply of 45 million tons. However, accessible sustainable wood biomass supply stands at 26 million tons. This amount meets 59% of the total demand of 44 million tons per year. The theoretical potential production of agriculture residues is between 1,186,000 and 1,203,000 tons annually. The only business that utilizes biomass residues for electricity production is the sugar industry in a cogeneration process. A small amount of coffee and rice husks is also utilized for heat production in cement and tiles manufacturing. Another small amount is used for the production of carbonized and non-carbonized briquettes. Most of the biomass is used for cooking while a small share is either used as a fertilizer and/or animal fodder. The wood biomass demand and supply scenario projects that in the next ten years, the country will move from a surplus to a deficit and later to an acute deficit. By year 2011, the deficit is estimated to be 10.7 million tons.

Biomass stoves: Best practice case study

Against the background of high deforestation rates and firewood scarcity in Uganda, the Ministry of Energy and Mineral Development, with the support of the German Agency for International Cooperation (GIZ) through the Energy Advisory Project (EAP), partnered with NGOs and the private sector to promote the improved Rocket Lorena Stoves for households and institutions. The rocket stoves for households have been modified to fit the socio-economic setting of the poor by using locally available materials that can be obtained cheaply or at no cost. More information on the strategy, which has been successfully used to disseminate over 175,000 Rocket Lorena stoves in Bushenyi and Rakai districts in Uganda since 2005.

Hydropower

The electricity supply system in Uganda was developed during the 1950s and 1960s with the construction of the Owen Falls Hydropower Station (later renamed Nalubale Power Station) with 10 generators with a total installed capacity of 150 MW. Later the power station was refurbished and upgraded to 180 MW and a new power station, Kiira, was constructed with a capacity of 200 MW. With the liberalization of the economy and the unbundling of the electricity utility, both Nalubale and Kiira hydro power stations were leased to Eskom (U) Ltd under a 20-year concession agreement. The two hydropower stations form the back bone of the electricity supply network in the country. The private companies Kilembe Mines Ltd, Tronder Power and Kasese Cobalt Co. Ltd have their own smaller hydropower plants Mubuku I with 5.4 MW, Mobuku II with 14 MW and Mobuku III with 10.5 MW. The stations were initially built to supply their own industrial activity, but due to the interruption in the copper and cobalt production activities, the companies entered into a contract with the UETCL in 2003 to sell power to the grid. Other power stations are the Kanungu Power Station of Eco Power with 6.4 MW, and Mpanga Power Station of Africa Energy Management Systems with 18 MW. Three other small hydro power stations Kuluva (120 kW), Kagando (60 kW) and Kisiizi
(300 kW) supply electricity to isolated hospital grids. The German Agency for International Cooperation (GIZ) set up small hydro power plants in Bwindi (64 kW) and Suam (40 kW). The country is facing occasional electricity supply shortages. Uganda’s total installed capacity is 822 MW, generated primarily from Owen Falls Hydropower Station at Jinja in the South-Eastern part of Uganda (see Wikipedia "List of power stations in Uganda"). However, during droughts (like in 2009), only around half of the installed capacity could be used as a result of the low water level of Lake Victoria. Contributing to electricity supply problems is the fact that growth in demand for electricity has not been matched with new generation capacity. To alleviate this problem, the government has procured emergency thermal generators. A new hydro facility has been developed at Bujagali, and is operational since February 2012. The installation capacity is 250 MW. Before Bujagali became operational, 150 MW thermal capacities had been added in order to bridge the gap until the beginning of 2012. All big power generation plants belong to the Ugandan Electricity Generation Company Limited (UEGCL) but are operated and managed by ESKOM, Aggreko and other companies. (Two dams in Uganda are equipped with desilting gates and have proper plans for the management of upstream water and land use issues. However, there are no national plans for optimised operation of power plants under variable flow regimes).

Hydro potential and distribution

A Hydropower Development Master Plan has been developed with support from the Japan International Cooperation Agency (JICA). Uganda has considerable hydro resource potential estimated to be over 2,000 MW. The large-scale hydropower potential is along the White Nile, which originates in Lake Victoria. The flow of the White Nile River is controlled by the Owen Falls Dam. The water is released according to an “agreed curve” which is a relationship of the lake level and the flow representing the natural flow rate at Ripon Falls prior to the construction of the dam. In the long term, three large hydro power stations will be constructed. The Isimba Power Station with a capacity of 183.2 MW and expected to be operational in 2018. The Karuma Power Station with 600 MW installed capacity and expected to be operational in 2018. And the Ayago Power Station with a size of 600 MW and expected expected to be operational in 2023. The small and mini hydro sites are mainly located in the Eastern and the Western parts of the country which are hilly and mountainous. A total of 59 mini hydropower sites with a potential of about 210 MW have been identified through different studies. This gives a fair picture of the small and mini hydro potential in the country. Some of the sites can be developed for isolated grids and others as energy supply to the grid.

Solar energy

The level of solar energy utilization in Uganda is still very low. The use of solar PV began in the early 1980s mainly driven by donor-funded programmes for lighting and vaccine refrigeration in health centers. Later the Uganda Railways Cooperation, a government parastatal, installed 35kW at 29 locations for communications and signaling. The Uganda Post and Telecommunications Cooperation also installed 30kW at 35 remote telecommunication sites through out the country. Some of the earlier initiatives included:

• PV systems installed by Uganda Rural Development and Training in Kagadi through a credit scheme supported by a Dutch organization Humanist Institute for Development Cooperation (HIVOS).
• Habitat for Humanity and Solar Electric Light Fund funded by the US Department of Energy installed 125 solar home systems for low-income families in Kasese.
• Solar Energy Uganda Ltd in partnership with Solar Light Churches for Africa installed a number of PV systems. However, the efforts were uncoordinated and lacked after-sales support.

In 2001, the Government launched the Rural Electrification Strategy and Plan (RESP) for the years of 2001 to 2010. It expired in 2012 due to delayed implementation. Among other, the RESP was supposed to increase the use of solar PV in rural areas. Unfortunately the RESP for 2001-2010 did not meet expectations. The plan anticipated rural electricity access to grow from the then-estimated 1% percent in rural population access to 10%. However the actual result was an increase of rural access by less than 5% percent. Also the RESP had a target of 80,000 PV systems by 2012 but in the end only 7,000 systems were installed. Following this, the electrification strategy and plan 2013-2022.pdf Rural Electrification Strategy and Plan 2013 – 2022 was published. As part of the rural electrification program, Energy for Rural Transformation (ERT I), supported by the World Bank, is implementing PVTMA, a sales-based performance subsidy scheme that also provides business development support to private PV dealers, which is expected to increase PV sales. Under the same programme, the Ministries of Health, Education, and Water and the Uganda Communication Commission have procured PV systems to meet their sectors' electricity needs. The Ministry of Health planned for 568 PV systems for health centers under ERT Phase I. Finally 79 Solar DC vaccine fridges were supplied to Health Centers (HC); 261 staff houses received stand alone solar PV energy packages for lighting and operation of radio and TV/VCR; and 220 medical buildings received 17 stand alone solar PV energy packages. The Ministry of Education planned for 458 solar systems for 129 post-primary institutions in 10 districts. By the end of the ERT I, 94 of the 129 institutions had been electrified. After ERT I, the second Energy for Rural Transformation (ERT II) project was initiated. Its focus is to increase access to energy and Information and Communication Technology (ICTs) in rural Uganda. There are three components to the project, which are: rural energy infrastructure, the ICT and energy development in terms of cross sectoral links and impact monitoring. The project is running from 6th of April 2009 until 30th June 2016 and will cost about 105 million USD. One part of the ERT II was the supply, installation, commissioning and maintenance of PV packages for 310 primary education institutions.

Solar potential and distribution

The average solar radiation is 5.1 kWh/m²/day. Existing solar data clearly indicate that the solar energy resource in Uganda is high throughout the year. The data indicate a yearly variation (max month / min month) of only about maximum 20% (from 4.5 to 5.5 W/m²), which is due to the location near the equator. The insolation is highest in the dryer area in the north-east and very low in the mountains in the east and south-west.

Photovoltaik: Best practice case study

Against the background of low electrification rates, particulalry in rural areas, the Uganda Ministry of Energy and Mineral Development with financial support from UNDP and GEF implemented the Uganda Photovoltaic Pilot Project for Rural Electrification (1998-2003). The main objective of the project was to provide basic electrical services through solar PV to rural areas unlikely to have access to grid-based electricity in the foreseeable future.

Wind energy

All wind measurements, which have been carried out so far are for meteorological record purposes (general weather data). The standard height for the location of measuring equipment is two meters above the ground and the sensors are often placed close to obstacles. The wind data collection from the national meteorological stations was never done with the intention of monitoring wind speeds for energy utilization. Based on wind data collected at 11 sites in three years (1989-1992) by the Department of Meteorology, Ministry of Water, Lands and Environment, the wind speeds in most areas of Uganda are moderate with average speed not exceeding 3 m/s. In some areas with complex terrain, the wind may speed up due to slopes of hills, escarpments and tunneling effects. In the mountain areas in the south-western part towards the border with Rwanda (Kabale, Kisoro, Ntungamo) and in the area around Mt. Elgon the average wind speed goes up to about 4 m/s. Measurement carried out under the Alternative Energy Resource Assessment and Utilisation Study at two sites for five months (June-Sept 2003) indicated that the average wind speed at Kabale and Mukono at 20m was 3.7m/s. This study concluded that the wind energy resource in Uganda is insufficient for large-scale electricity generation. However, the wind resource may be suitable for special applications, such as water pumping in remote areas and for small-scale electricity generation in mountainous areas. It is possible that some sites could have enough wind speeds to generate substantial amount of electricity. Preliminary investigations in the Karamoja region (North-Eastern Uganda) and along the shores of lake Victoria have shown that there could be potential for production of electricity on a medium scale.

Geothermal energy

The exploration for geothermal resources in Uganda is still at the reconnaissance and exploration stage. Reconnaissance surveys on Ugandan hot springs started in 1921 by the geological survey of Uganda and the first results were published by Wayland (1935). In 1973, as a result of the oil crisis, an attempt was made to initiate a geothermal project with United Nations support, but this did not materialise due to the political turmoil in the country. Geothermal energy resources in Uganda are estimated at 450 MW. Exploration for geothermal energy has been in progress since 1993. So far, three potential areas all situated in western Uganda, in the western branch of the East African Rift Valley have been identified for detailed exploration. The three potential areas are Katwe-Kikorongo, Buranga and Kibiro. Based on recent assessments, they have all been ranked as potential targets for geothermal development. The current study results indicate that the temperature level varies between 150 C° and 200 C° which is sufficient for electricity generation and for direct use in industry and agriculture. The rest of the geothermal areas of Uganda are at a preliminary level of investigation and results will soon be available as basis for their prioritisation for detailed surface exploration.

Cogeneration

Currently there is a capacity of 29.7 MW in two cogeneration plants installed, which both run with bagasse as fuel.Further there is a considerable potential of cogeneration in the sugar processing industry as well as textile manufactures, beer industry, cement industries and foods and beverages industry. The potential in the sugar industry alone is currently estimated to be over 100 MW while for other industries it could be over 50 MW. Cogeneration contributes to power generation as well as to the goal of energy efficiency.

Fossil fuels

The annual consumption of petroleum products was 1.4 billion litres in 2012, which is an increase of 13.9 % compared to 2011. The average annual growth of petroleum consumption is about 7%. In 2012, the import bill for petroleum and petroleum products was the highest, totaling 1.3 billion US$ and accounting for 22.2 % of expenditure on formal imports. The total amount of petroleum products imported in 2012 stood at 1.227 billion litres. The composition is as follows: Petrol (41.1%), Kerosene (6.1%), and diesel products (52.8%). Uganda imports all its petroleum products from overseas since there is no local production yet. About 95% of Uganda’s petroleum imports are routed through Kenya and only 5% come through Tanzania. Oil has been detected in six sedimentary basins in Uganda, the most prospective being the Albertine Graben covering 23,000 km² in the Western Rift Valley along Uganda’s Border with the Democratic Republic of Congo. Two other basins, Hoima basin and Lake Kyoga basins are still under investigation. Currently the amount of oil discovered is about 6.5 billion barrels of which 1.4 billion barrels are recoverable. But it has to be noted that the numbers change every now and then, suiting to the political situation or new research projects. It is important to note that only around 40% of the Albertine rift basin has been evaluated. This discovery is placing Uganda among the foremost African oil producers. So far over 1 billion US$ has been invested in seismic and drilling of wells since 1998. By international standards the cost of finding a barrel of oil has been very low in Uganda. Bigger investments are required to develop the discovered oil and gas fields. A refinery with an input capacity of 60,000 barrels per day will be build in a modular manner, starting with a capacity of 30,000 barrels per day by the end of 2016 which will be increased to 60,000 barrels per day before 2020. A production sharing agreement between the Government and the consortium Tullow Oil (Ire-UK), Total (F) and CNOOC (China) was concluded in February 2012. The consortium will in the near future detail its planning for the construction of the oil fields. Norway is the lead development partner in the petroleum sector, with a three-year, US$15 million programme, which began in June 2009. The IMF is providing support on petroleum revenue management; the AfDB is providing support on infrastructure; Ireland is considering ways in which it can support civil society in Uganda to work in the sector; DFID is already funding some groups and is exploring other ways to support civil society; and the World Bank is helping with environmental regulations and discussing a possible Petroleum Sector Support Project with the government. The EU delegation is active in all pertinent donor forums in which oil is becoming an increasingly important issue. The EU is actively seeking a better coordination and consolidation of current donor activity.

• For more information on the fossil fuels resources in Uganda, click here.
  

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Electricity transmission and distribution

The Ugandan grid is split up into transmission (> 30 kV) and distribution (<= 30 kV). The transmission system losses are approximately less than 4 % and the distribution system losses were 38% in 2005, 26.1% in 2012 and 24,9% in June 2013.

Transmission

The Uganda Electricity Transmission Company Ltd. (UETCL) is the bulk supplier and single buyer of power for the national grid in Uganda. It purchases all independently generated power in the country and it also imports electricity from neighboring countries. UETCL is also responsible for publishing standardized tariffs for renewable energy generation of up to 20 MW capacity based on the avoided cost principle. The length of domestic transmission and distribution lines is 14,312 km.

Distribution

The biggest company empowered to trade and supply electricity at 33kV and below is Umeme Ltd, which leased the assets of the formerly government-owned distribution company (Uganda Electricity Distribution Company Ltd - UEDCL). There are some mini-grid distribution systems and one off-grid generation and distribution company (West Nile Rural Electrification Company Ltd).

Energy Tariffs

Energy cost

The end user tariff for domestic consumers is at 520.6 UGX (Umeme - Q4,2014), one of the highest in East Africa. This is due the enormous raise of prices (52%) in 2012 up to nearly cost-covering end-consumer prices. Currently, the end user retail tariff is based on consumer category as illustrated in the following table. However, to cater for the poor, the life line tariff was not increased and remains at UGX.100 per unit up to 15 kWh per month. The following table shows all the Umeme tariffs from Q4,2014.

Charge	Code 10.1 (domestic)	Code 10.2/3 (commercial)	Code 20 (medium industrial)	Code 30 (large industrial)	Code 50 (street lights)
Average	520.6	474.4	458.9	310.4	488.8
Peak	-	569.7	542.3	373.7	-
Shoulder	-	475.0	452.2	311.6	-
Off-peak	-	354.0	371.0	232.5	-

Feed-in-Tariffs (FiT)

To promote the development and use of renewable energy sources, the Government has developed a feed-in-tariff structure. A Feed-in-Tariff (FIT) is an instrument for promoting private sector generation of electricity from renewable energy sources. Renewable energy in the context of REFIT is defined as electricity, which can be generated from energy resources such as water power, wind power, solar energy, geothermal energy, biogas and landfill gas combustion, and biomass cogeneration. The REFIT applies to small-scale renewable energy systems of prescribed priority technologies, up to a maximium installed project capacity of 20 MW, as defined by the Electricity Act 1999. The Feed-in-Tariff (FiT) for solar power was approved by the ERA board in April 2014 at an amount of US$0.11/kWh. The FiTs are paid by the Uganda Electricity Transmission Limited (UETCL).

Policy Framework

Energy Policy and Poverty Reduction Strategy

The Government of Uganda has over the past eight years embarked on a Power sub-Sector Reform Programme, which has resulted in the implementation of significant structural changes within the sector. The Reform Programme was aimed at providing adequate, reliable and least-cost power supply to meet the country’s demand, promoting the efficient operation of the power sector and scaling up rural and peri-urban access to maximize the impact on poverty reduction. Despite the implementation of these reforms, the country continues to experience significant power supply shortages, low rates of access to electricity and high levels of power losses, all negatively impacting the country’s economic growth. The low level of access to modern forms of energy, particularly electricity, has continued to be one of the major infrastructure bottlenecks to socio-economic growth in Uganda.

The following laws have been passed in order to reform the energy sector:

The Electricity Act, 1999

The salient features of the Act are:
a. Liberalizing the electricity industry;
b. Disbanding of the Uganda Electricity Board (UEB) (historically a vertically integrated monopoly) into three entities namely generation, transmission and distribution;
c. Establishment of Electricity Regulatory Authority (ERA) to regulate the sector;
d. Establishment of the Rural Electrification Fund (REF), with the main objective of enhancing rural access to electricity; and
e. Establishment of the Electricity Dispute Tribunal (EDT) that has jurisdiction to hear and determine electricity sector disputes which are referred to it.

The Energy Policy for Uganda, 2002

The main policy goal is “to meet the energy needs of the Ugandan population for social and economic development, in an environmentally sustainable manner”. The broad policy objectives are:
a. To establish the availability, potential and demand of the various energy resources in the country.
b. To increase access to modern affordable and reliable energy services as a contribution to poverty eradication.
c. To improve energy governance and administration.
d. To stimulate economic development.
e. To manage energy-related environmental impacts.
f. To increase the role of private sector in the power sector operations and future development.

Renewable Energy Policy for Uganda, 2007

The overall goal of the Renewable Energy Policy (REP) is to increase the use of modern renewable energy.
The key policy objectives include:
a. To maintain and improve the responsiveness of the legal and institutional framework to promote renewable energy investments;
b. To establish an appropriate financing and fiscal policy framework for investments in renewable energy technologies;
c. To promote research and development, international cooperation, technology transfer and adoption of standards in renewable energy technologies;
d. To utilize biomass energy efficiently so as to contribute to the management of the resource in a sustainable manner;
e. To promote the sustainable production and utilization of bio-fuels; and
f. To promote the conversion of municipal and industrial waste to energy. Under the power generation programme, REP promotes power generation from mini-hydro power schemes, biomass, cogeneration, wind, solar, geothermal and peat. There are plans to consider nuclear power generation in the power mix in the long term.

The Atomic Energy Act, 2008

The Act provides for:
a. Regulation of the peaceful applications of ionizing radiation;
b. Establishment the Atomic Energy Council (AEC);
c. Protection and safety of individuals, society and the environment from the dangers resulting from ionizing radiation;
d. Production and use of radiation sources and the management of radioactive waste;
e. A framework for the promotion and development of nuclear energy for use in power generation and other peaceful purposes;
f. Compliance with international safety requirements for the use of ionizing radiation, radiation protection and security of radioactive sources;
g. Repeal of the Atomic Energy Act, Cap. 143; and other related matters.

Energy is also an integral part of the Ugandan Government’s Poverty Eradication Action Plan (PEAP) which includes frequent references to the link between energy and poverty alleviation. The Ugandan Government has set the target of providing 10% of rural population with access to electricity until 2012. This target has been specified in the Rural Electrification Strategy and Plan as well as in the PEAP. It is planned to be achieved by grid extension (including through private sector involvement), mini-grids and stand-alone electrification systems. In April 2010, the Government of Uganda launched the National Development Plan (NDP), which covers a number of energy issues. One of the objectives of this plan is increased access and consumption of electricity for growth, employment and socio-economic transformation. Limitations of the forestry sector and their impacts on the country's development are elaborated on as well as challenges of the power sector. In consequence, the NDP highlights the following strategies to overcome the barriers of the energy sector towards achievement its goals: Increase power generation capacity to reach 780-820 MW, mainly through large and small hydro; increase rural electrification from 6% to 10% by, among others, subsidization of mini-grids; promotion of energy efficiency, reduction of power losses from 40% to 16%; revision of existing policies in the energy sector and promotion of renewable energies, esp. biomass and solar. A consultant supported the Ministry to work out The Energy Efficiency and Conservation Bill to promote efficient utilisation of energy in Uganda. Besides that several awareness raising campaigns are carried out. ►Go To Top

Institutional Set-up and Actors in the Energy Sector

Public institutions

There are three main governmental institutions dealing with renewable energies for power generation:

• The Ministry of Energy and Mineral Development (MEMD) is the lead agency in the energy sector. The Ministry is responsible for policy formulation, promotion, coordination, monitoring and evaluation. MEMD is also responsible for initiating legislation in the energy sector. Uganda’s National Energy Policy is so far centralized, i.e. there are no energy officers at sub-national/district level. Part of the MEMD is the Energy Department (ED), which is structured according to sectors. ED comprises four divisions “Energy Efficiency”, “Innovative and Renewable Energies”, “Electricity” and “Provision with Oil Products”.
• Rural Electrification Agency (REA) functions as the secretariat to the Rural Electrification Board, which realizes MEMD`s rural electrification plans as stipulated in the Indicative Rural Electrification Master Plan. REA controls public funds as for the subsidization of rural electrification projects.
• Electricity Regulatory Authority (ERA), which was established by the Electricity Act of 1999, is in charge to issue licences for the generation, transmission, distribution or sales of electricity. ERA has also the mandate to establish a tariff structure and investigate tariff charges and approve the rates of charges.

Development partners

Uganda has a large community of international development partners in the energy sector. Better co-ordination and management of international donor support to facilitate improved energy access and better value for money and the reduction of duplication would benefit Uganda significantly. Activities are coordinated through the Energy and Mineral Development Partners Group (EMDPG) which Germany has the lead in since November 2010. Following institutions and countries are represented in this working group: KfW, GIZ, USAID, DFID, EIB, EU-Commission, France, Ireland, IWF, AdDB, JICA, Norway and World Bank. Furthermore these institutions are supporting the Ugandan energy sector: NORAD, IAEA, USTDA, IDB, UNDP, UNIDO, NDF and SIDA.

Project implementing NGOs

Energy is generally a side topic for most Ugandan NGOs. However, a lot of projects involve renewable energies as they have a sustainable character and there are several NGOs with certain experiences in the field of the introduction of improved stoves, solar systems and solar lamps.

Commercial service provider

By 2010, in the field of photovoltaic systems over 30 providers operated in Uganda. The Solar companies in general have difficulties to develop markets in rural areas and focus their interest on urban areas. In the field of stoves there are numerous artisans and private-business companies producing improved cook stoves especially for the urban market. Some of these artisans and private-business companies were trained and supported by the EnDev-Uganda programme.

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Key Problems Hampering Access to Modern Energy Services in Rural Areas

Obstacles for Grid Based Rural Electrification

The Government of Uganda has limited resources for extending the grid to rural areas. At the moment, the Government’s focus is on solving the power supply crisis that is crippling the national economy. Based on an improved power generation it will concentrate its efforts to extend the grid to major urban and peri-urban areas. Tariff rates for customers differ according to the category of client. They reflect the cost of electricity supply to that category. Implementation of this principle eliminates cross-subsidization of any category of customers by other categories. As a result, the tariff for domestic consumers is relatively high with 0,15 €/0,19 USD per kWh (UGX 518.7 – Umeme Q4,2014). This tariff is often higher than the tariff for industrial consumers because domestic consumers who take supply at the low voltage impose higher investment and operational costs on the system than industrial consumers who are supplied at the high voltage or medium voltage. For Umeme ltd. it is generally profitable to extend the grid. However, poor households cannot afford the connection fee and the electricity costs. In addition, collection costs are high in areas with dispersed population and low numbers of clients. Prepaid meters are more and more common in Uganda. By the end of August 2013, Umeme had installed 33,985 prepayment meters. Beside Uneme, private companies invest in minigrids only in exceptional cases. Normally, costs of providing access are too high due to remoteness of the sites, dispersed populations and difficulty of the terrain. Local communities don’t dispose of sufficient proper financial resources to make infrastructure investments in their community. ►Go To Top

Obstacles for Off Grid Energy Technologies and Services

There is strong political motivation to improve access to electricity of rural populations, particularly those remote from the grid. However, in the case of SHS both the affordability and the availability were seen as major problems for the dissemination of the solar systems in rural areas. In the case of hydropower, the investment costs are generally not affordable for rural communities and investors. In addition, there is a lack of management skills to operate MHPPs. Generally, the availability of micro-finance schemes for energy technologies in rural areas is limited. If accessible, the costs for such financing are very high (typically at rates as high as 25% per month). Large parts of the country have almost no access to institutional micro-finance services and must rely largely on moneylenders, suppliers, family and friends for short -term seasonal loans. There are no secure liquid savings options available to these households, which would enable them to build assets over time. Existing micro-finance institutions often have a narrow credit product line, limited experience in rural markets and a lack of access to best practice information and technical tools. In addition marketing and maintenance structure for energy technology devices in rural areas are weak. Almost all retailers are established in the big cities with no outlets in rural communities. Thus, clients have to travel to cities to purchase energy devices and for repair orders, which is difficult for most rural families. Establishing rural outlets is not considered to be profitable due to the high costs for transportation and mobilization, the dispersed nature of the populations and the low income and low demand of the local population. ►Go To Top

Further Information

• Centre for Research in Energy and Energy Conservation, CREEC (www.creec.or.ug).
• Ministry of Energy and Mineral Development 2002, The Energy Policy for Uganda
• Ministry of Energy and Mineral Development 2012, electrification strategy and plan 2013-2022.pdf Rural Electrification Strategy and Plan 2013 - 2022
• Ministry of Energy and Mineral Development 2007, The Renewable Energy Policy for Uganda
• Ministry of Water, Lands and Environment 2013, The National Forest Plan 2011/12 – 2021/22
• National Planning Authority 2010, National Development Plan 2010/11 – 2014/15
• Kamfor Company Ltd 2006, Report on the Renewable Energy Resource Information Development and Capacity Building Assessment In Uganda, Ministry of Energy and Mineral Development, Kampala, January 2007
• Kennedy & Donkin Power Limited 1996, The UEB Hydropower Development Master Plan – Part 1, Volume 2 Main Report, Kampala November 1997
• Kennedy & Donkin Power Limited 1996, The UEB Hydropower Development Master Plan – part 1, Volume 7, Hydrology and Hydropower Potential of Non-Nile Rivers, July 1996
• Sweco International 2001, Evaluation of Hydropower Potential Sites in Uganda with Capacity in Range of 0.5 – 50 MW, Kampala, March 2001
• Electrowatt-Ekono Oy – Norplan AS, COWI A/S 2003. The Uganda Alternative Energy Resources Assessment and Utilisation Study, Kampala, June 2003
• Electrowatt-Ekono Oy, NORPLAN A.S and COWI A/S (2004): The Uganda Alternative Energy Resources Assessment and Utilization Study AERDP Main Report Phase 1, Kampala, February 2004
• Ministry of Energy and Mineral Development 2006, Plan for Meeting Uganda’s Electricity Supply Needs In The Short, Medium And Long Term, Kampala June 2006.
• United Nations Development Programme (1998), Uganda Photovoltaic Pilot Project for Rural Electrification, Project Document, Kampala 1998
• B. Banks and G. Kihuguru (2006), Uganda Photovoltaic Pilot Project for Rural Electrification UGA/97/G32 Ex-Post Evaluation Report, UNDP, Kampala, May 2006
• Pallabazzer, R.: The Wind resources in Uganda. Renewable Energy, Vol 13, no 1, pp 41-49, 1998
• Uganda - Information Sources

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References

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