By Frank Kamuntu
As Uganda approaches a significant shift in its power distribution sector, Umeme Ltd, the country’s largest electricity distributor, is set to exit the market when its 20-year concession comes to an end in March 2025. The government has already set Uganda Electricity Distribution Company Limited (UEDCL) to take over operations, ensuring a seamless transition to maintain uninterrupted power supply to millions of Ugandans.
During a public hearing organized by the Electricity Regulatory Authority (ERA), UEDCL’s Managing Director, Paul Mwesigwa, reassured the public of a smooth transition and continuity of services after Umeme’s exit. He emphasized that UEDCL is prepared to absorb all Umeme employees and will maintain its focus on expanding the national power distribution network while improving operational efficiency.
Mwesigwa noted that UEDCL has already implemented successful measures in areas it currently operates, including reducing energy losses from 28% to 18.1% and improving revenue collection to 99.9%. With a strategic investment plan of UGX 4 trillion over the next three years, UEDCL aims to connect an additional 300,000 new customers annually while working to reduce national energy losses even further.
“We currently have 65 offices in the areas we operate but we hope to increase them to 100 all over the country by adding those of Umeme and also do rationalization. We plan to have 3175 staff all over the country but also seek to reduce the energy loss to 15.2% by 2027 and a 99.76% revenue collection rate,” Mwesigwa said at the public hearing.
Mwesigwa announced that the company’s expansion would require additional installations, alongside reclaiming assets currently managed by Umeme. He also mentioned that the expansion would create even more job opportunities.
Further, the company committed to connecting all consumers, including private and government entities, to the prepaid metering system known as Yaka. This proposal raised concerns among some corporate clients, such as tower company ATC, which expressed apprehension about the complexity of migrating despite their consistent payment records. However, UEDCL reassured stakeholders that the transition to smart metering aligns with global trends, and they would offer assistance to anyone facing challenges. Mwesigwa emphasized that the transition would affect areas currently under their power distribution, including police and army barracks, as well as health facilities.
Meanwhile, as UEDCL prepares to take over, the government is also in the process of determining the buyout amount for Umeme’s assets and investments. Eng. Ziria Tibalwa Waako, ERA’s Chief Executive Officer, explained that the Office of the Auditor General will finalize this process by March 2025, ensuring that Umeme is compensated for its contributions to Uganda’s power infrastructure over the past 20 years.
Eng. Waako further clarified that the transition aligns with the government’s Second Generation Reforms in the electricity sector, which aim to phase out private concessions and rationalize public services.
UEDCL’s readiness to assume national operations is a key part of these reforms, which are intended to enhance efficiency and increase government oversight of critical public utilities.
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