Gov’t preps UNECL to take over from UMEME

The Minister of Energy and Mineral Development, Ruth Nankabirwa has said that government has constituted committees to oversee the transition from UMEME and Eskom operations to the Uganda National Electricity Company Limited (UNECL).

Addressing the press in Kampala, Nankabirwa revealed this as part of the ongoing implementation of the power sector reforms, targeting to enhance sector performance and provide affordable power to the people of Uganda following a cabinet directive of October 3, 2022.

Cabinet, among others, directed the ministry not to renew the concession and privatisation agreements for Eskom Uganda limited and UMEME limited after their concessions come to their natural end in 2023 and 2025.

"On behalf of the government of Uganda, I take this opportunity to appreciate UMEME and Eskom for the operation and maintenance of government assets on behalf of UEDCL and UEGCL for the past 18 and 19 years, respectively." she said.

According to her, “The ministry has already constituted a joint committee to handle the Eskom concession and is in the process of making a similar arrangement for the UMEME concession”.

The respective committees have been tasked with the planning and management of the end of the concessions to ensure seamless handover of the operations of the assets.

The minister however noted that the electricity distribution network under UMEME covers a large percentage of the country and it has grown in asset capacity, complexity and employs about 2,000 staff.

To this effect, she called upon the parties to the concession agreements to ensure a smooth transition of all the relevant responsibilities and asset handover in close coordination with the ministry.

These reforms are expected to minimize expensive private capital in the electricity sub- sector investments in generation, transmission, and distribution. It will culminate in creating the Uganda National Electricity Company Limited (UNECL) as a state-run entity with majority shareholding under a Public Private Partnership (PPP) arrangement as a possible option.

Relatedly, Irene Bateebe, the permanent secretary of the ministry of energy reiterated that government is committed to avail the necessary financing to ensure it fulfills its obligations in the related agreements.

"UEDCL and UEGCL will be supported to enable them to manage the transition period and operation of the concessions as happened with the 50MW Namanve Thermal Power Plant that has reverted to UEGCL in 2021." she said.

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