Prime
Government, Umeme in talks over new deal, minister says
Energy minister Mary Goretti Kitutu
What you need to know:
- The minister told Parliament that the negotiations over the extension of the contract are being handled by President Museveni and the company’s top leadership. Umeme’s 20-year concession will expire in 2025.
Government is locked in negotiations with Umeme over whether or not to renew the contract of the electricity distribution company, the Minister of Energy and Mineral Development, Ms Mary Goretti Kitutu, has revealed.
The minister told Parliament that the negotiations over the extension of the contract are being handled by President Museveni and the company’s top leadership. Umeme’s 20-year concession will expire in 2025.
“These negotiations are going on at the high level of His Excellence (President) and we will get you informed when an agreement is reached,” Ms Kitutu said on Wednesday.
She was responding to a concern raised by the Kawempe North Member of Parliament, Mr Latiff Ssebaggala, who said the country had been left in the dark about the status of the Umeme concession, which is ending in four year’s time.
Ms Kitutu also hinted on the possibility of the government opening up the bidding to other companies that may be interested in taking over from Umeme. “The conditions which were there when Umeme came are not what we are in at the moment. We now have options of choosing from other companies or we can take it up ourselves,” she said.
President Museveni has in the past threatened to cancel Umeme’s concession over hiked power tariffs. In one of his letters, Mr Museveni stated that the Umeme concession was “messed up” leading to high power tariffs.
Solutions
With several Ugandans failing to be connected to electricity despite applying for connection for more than a year, the minister revealed that government has imported materials that will benefit 87,000 applicants.
The materials that are expected to arrive in August are financed by the African Development Bank and Exim Bank of China. This will reduce the 200,000 applications backlog as of July 2020.
“The materials are arriving in the country this month to enable ESI (Electricity Supply Industry) to commence free no pole connections starting March 1,” she said.
Ms Gitutu was making a statement in response to a matter raised last week by Bugabula South MP, Moris Henry Kibalya, who said many Ugandans are stuck after applying for the free connection with no action from the government.
These free connections are being implemented under the Electricity Connection Policy (ECP) whose implementation commenced in November 2018 and is supposed to take a period of 10 years with a target of 60 per cent level of access to grid electricity.
The ECP under which consumers are only required to pay Shs20,000 inspection fees, targets an increase of connections from an average of 70,000 annually before its enforcement to 300,000 connections.
Ms Gitutu revealed that government was in arrears of Shs102.4b to the service providers and as an interim measure, it has since December allowed consumers that were willing to pay for their connections to do so as funds are being mobilised.
The government according to the minister requires Shs250b annually to fund the 300,000 new connections that will be financed through the end-user tariff.
