Uganda Ready to Double Generation with More Hydro Projects

Ugandan officials said they want to double the country’s installed power generation capacity over the next two years, primarily with the construction of hydropower projects. However, those same officials acknowledged that the country’s transmission infrastructure must be improved in order to take advantage of the increased generation.

Irene Muloni, the country’s energy minister, told attendees of the Future Energy Uganda conference at Kampala in mid-September, “In the next two years, we shall double our current capacity, which is at about 950 MW. If we generate that power and want it to reach end users who are industries and our homes, both in cities, towns, and trading centers, we must have the transmission networks upgraded so that it is able to transmit huge volumes of electricity.” Only about 22% of Uganda’s population is connected to the country’s national power grid.

Muloni said several private studies are underway to determine what steps the country should take to address its power needs, including the potential for more generation, the type of generation, its cost, and the tariff structure for power markets. When Uganda joined the United Nations Sustainable Development Goals program in 2012, it set a target of having electricity available to all the country’s population by 2030.

Muloni noted keeping electricity cheap for the country’s users is a primary mechanism for supporting more industrialization, which is needed to create jobs and improve Uganda’s economy. She said hydropower—the country already has three hydro stations, located near the source of the Nile River in Jinja—is important because “We have structured electricity production in the country through renewable energy, mindful of the environment and health of the people, hence tapping into hydroelectricity, being one of the cheapest sources of electricity and solar. Others include geothermal, wind, and biomass, largely because of the sugar factories.”

Figure 7_Karuma
1. Using water from the Nile. The Karuma station is a 600-MW hydropower project taking shape along the Nile in Uganda. The country has a goal of having electricity available to the country’s entire population by 2030. Courtesy: Uganda Electricity Generation Co. Ltd.

Ibrahim Kasita, the country’s director of communication in the ministry of energy and mineral development, told African Business Magazine earlier this year that “Our strategy is to develop half a dozen hydropower stations on the Nile.” Muloni at September’s conference said the country wants to increase its generation capacity to more than 1,900 MW over the next two years.

The majority of that additional power would come from the 800-MW Ayago Hydropower project, which is targeted to come online by year-end 2018. Kasita said China is the main supporter of that project. Uganda has a deal with China’s export-import bank, backed by the Chinese government, securing long-term concessionary loans to finance its hydropower initiatives.

“The Chinese government has shown commitment to help Uganda develop the country’s hydropower potential along the Nile Valley,” Kasita told the African Business Magazine. “We expect Beijing to fund these projects.” Other hydropower projects under construction in Uganda, also utilizing water from the Nile, include the 600-MW Karuma station at Karuma Falls (Figure 1), and the 183-MW Isimba station, both funded by the export-import bank.

Kirunda Kivejinja, the country’s second deputy prime minister, said upgrades to generation, transmission, and distribution will happen only when the government has money to invest in projects. He said Uganda must create an environment that will bring in partners to help the country develop its energy infrastructure. Prime Minister Ruhakana Rugunda said his government recognizes the energy industry has the potential to create jobs in the country, and it will invest in projects as the country’s finances improve.

According to State House Uganda, the official government website, the government has invested about 850 billion shillings (about $8.26 billion) into current energy infrastructure projects, with more than 95% of the money going toward work on the Ayago, Karuma, and Isimba hydropower stations.

Darrell Proctor is a POWER associate editor.