Uganda Plans To Open Power Transmission To Private Investment - Regulator
Uganda said on Thursday it is preparing to open up to private investors the transmission business of its electricity sector that officials say needs billions of dollars in fresh capital.
Growth in transmission infrastructure has lagged that in generation and distribution which have attracted substantial investment, especially from China, after the government partially privatised those two sectors in the early 2000s.
An internal March 2020 report by state-run regulator Electricity Regulatory Authority (ERA) seen by Reuters shows the country’s power transmission sector needs at least $2.5 billion worth of fresh investment over the next seven years.
The report said if the sector is not opened up to private investment there’s a risk power plants under development may be completed and start producing power before required transmission lines are in place.
“The government is now exploring the possibility of opening up electricity transmission to private investment,” Julius Wandera, spokesman for the ERA told Reuters.
Internal discussions were underway, he said, but did not give a time when such discussions and necessary legal procedures would be concluded for tenders to be issued.
Uganda’s installed electricity generation capacity is expected to jump 55.5% to 1,825 megawatts (MW) when the new 600 megawatt plant being developed by China’s Synohydro Corporation is commissioned later this year.
Another Chinese firm, PowerChina International Group Limited (PIGL), has applied to Ugandan authorities for a licence to develop a $1.4 billion hydropower plant in the country.
The Ayago power plant on the River Nile will have a capacity of 840 megawatts (MW) and, when fully developed, would be Uganda’s largest power project.
Wandera said the new investments from the private sector would help “strengthen and expand the grid”
“We have a lot of power in the pipeline and we need to make sure that by the time these plants come on board there’s sufficient transmission infrastructure to (get) this power to consumers.”