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Electricity: Energy Ministry seeks Shs 128bln to connect homes

KAMPALA, December 6, 2023 - The Ministry of Energy and Minerals Development is seeking a supplementary budget of Shs 128 billion in the current financial year to connect 200,000 households across the country to the national electricity grid.

This is part of Shs 318bln that the Ministry presented before the House Committee on the Budget on Tuesday.

“This amount is external financing from the World Bank for the Electricity Access Scale Up Project [EASP] that was suppressed during appropriation, given that the project had not achieved effectiveness,” said Sidronious Okaasai, the Minister of State for Energy.

The Budget Committee is processing a supplementary budget of Shs 3.5 trillion for the financial year 2022/2023 tabled before the committee by the State Minister for Finance, Henry Musasizi.

The supplementary budget includes among others Shs 197bln towards road construction, Shs 47bln to facilitate the deployment of medical interns and their allowances and Shs 37bln for renovating Speke Resort Munyonyo ahead of the Non-Aligned Movement and the G77 Summits next year.

Okaasai assured legislators, that once the money is provided the Ministry will be able to connect most households that have already installed electric poles, for free.

“By connecting more people to electricity, the unit cost is likely to come down because more people will be paying. Give me the money and you will start seeing the connections by next month,” he said.

Okasaai noted that the EASP has since July 2023 been operational but requires additional funding to operationalize some of the activities.

The Ministry’s supplementary request includes Shs 30bln to cover startup costs for Karuma Hydro Power Plant, such as plant insurance, permits, service contracts, and specialised tools.

“This funding is intended to support the project’s implementation, with the goal of commencing commercial operations in November 2023,” Okaasai said.

He also requested for Shs 58bln to cater for shortfalls on the contractual obligations for deemed energy, under the Lira-Agago transmission line for the Achwa-Agago dam.

Members of Parliament okayed the supplementary request as they cautioned the Ministry to deliver on their promise, by connecting mostly the rural-based households.

“One of the reasons some of us supported the disbandment of Rural Electrification Agency was their way of operation, connecting power with segregation. I generate electricity in my constituency, but I do not have power; I would like to see that when this money is given, we shall have electricity in my constituency for once,” said Ndorwa East MP.

Sheema Municipality MP, Dicksons Kateshumbwa, expressed concern over vast sums of money spent on deemed energy and urged the Ministry to utilize the supplementary and start using the energy.

“We are tired of deemed energy, we need an assurance that when this balance is finally paid, this country will continue paying vast sums of money because we have paid huge sums at the expense of connections. We do not want to hear you coming next year bringing requests on deemed energy,” Kateshumbwa said.

He asked the ministry to share the road map for implementation of the 200,000 connections, saying,” now that the World Bank funding was approved, and that we are going to approve this supplementary, can we start seeing the road map?” asked Kateshumbwa.

Only 1.7 million out of the eight million Ugandan households were connected to the national electricity grid by 2022, according to Electricity Regulatory Authority [ERA].

Meanwhile, findings from a survey in September-October 2019 led by
Hatchile Consult, showed that a proportion of Ugandans who live in zones served by the national electric grid has doubled since 2005, from 24 percent to 49 percent.

It also showed only one in four Ugandans [26 percent] live in households that are connected to the national power grid. Poor citizens and residents in rural areas and in the Northern region are least likely to be connected.

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