The Energy Sector of Uganda


Profile for Energy Sector of Uganda

Uganda’s energy potential

Uganda has the following potential sources of energy;

Hydropower potential            4,500MW

Biomass co-generation         1,650MW

Geothermal                              450MW

Peat power                              800MW

Others potential sources include petroleum energy, wind , solar power , fossil fuel thermal  and  nuclear energy .

Renewal and Non-Renewal Sources

Renewable Resources

The renewable resources include hydro, wind, solar, geothermal, biomass and peat.

Non –renewal resources

The non-renewable sources include bio fuel and fuel wood.

Uganda energy consumption

The total energy consumption in Uganda is estimated at over 5 million tons of oil of which 93% is derived from biomass (wood/ charcoal and agricultural residue); electricity and oil products constitute 7%. About  70.3 % of the energy is consumed in residential activities, 13.6% for  commercial ,  10.7% for Industrial , 5% for transport  and 0.4% other uses . Most of the energy consumed for residential activities is woody biomass energy mainly because of high tariff and low generation of  electricity power.

Installed electricity capacity

Uganda is still deficient in infrastructure, especially energy, roads, air transport, water transport and railways.. Therefore the Government is   committed to improve electricity generation and supply to support industrialization, as well as ensuring universal access to affordable, reliable and modern energy. According ERA, the country’s current installed generation capacity totaled about 930MW, as of end of 2017. An additional 783MW will be added to the national grid on completion of the 600MW Karuma and 183 MW Isimba power projects during  FY 2018.

The  Government plans to build additional electricity generating capacity at Murchison Falls (700MW), Oryang (392MW), Uhuru (350MW), Kiba (300MW) and Albatros thermal plant (50MW) among others. The additional generation will give Uganda a capacity of 4,356MW.

Per capita electricity consumption

Uganda has one of the lowest electrification rates in Africa, at 20% of the population, and one of the lowest per capita electricity consumption rates in the world, at 71 kWh per capita per year. This is compared to the SSA average of 552 kWh per capita and the world average of 2,975 kWh per capital.

Rural electrification

Uganda has the lowest electrification rates in Africa, at 22% in 2017. Rural electrification is estimated at less than 7 % of the rural population. About 84% of population of Uganda live in rural areas.

Market for solar energy

The market includes non-electrified rural households, schools, businesses and non-commercial establishments such as churches, mosques, health centers and community centers.

Market for micro hydro power

The market segments include electrifying rural households, schools, businesses, health centers, hotels, real estate housing projects, industries and non-commercial establishments such as churches, mosques, and community centers.

Market for charcoal briquettes

The market for charcoal briquettes includes rural and urban households, schools and institutions like prisons and hospitals.

Regulatory framework

Ministry of Energy and Mineral Development (MEMD)

The ministry is responsible for establishing, promoting the development, strategically managing  and safeguarding  the rational and sustainable exploitation and utilization of energy and mineral resources for social and economic development.

Legal framework

The  Uganda  electricity sector is regulated under the Electricity Act 1999, Cap 145, the Energy Policy, the National Environment Act Cap 153 and the Statutory Instruments and Guidelines issued by Electricity Regulatory Authority (ERA). The petroleum is regulated under Petroleum (Exploration, Development and Production) Act.

The electricity sector

The sector has the following three companies with responsibility as indicated;

The Uganda Electricity Generation Company Limited (UEGCL)

The company manages the electricity generation.

Uganda Electricity Transmission Company Limited (UETCL)

It manages the electricity transmission.

Uganda Electricity Distribution Company Limited (UEDCL)

It manages the electricity distribution. All the three companies are licensed and regulated by ERA.

The Electricity Regulatory Authority (ERA)

ERA   regulates the Uganda   electricity sector.

Electricity distribution companies

The licensed companies include Umeme Limited, West Nile Rural Electrification Company (WENRECo), Uganda Electricity Distribution Company Limited (UEDCL), Bundibugyo Electricity Cooperative Society (BECS); Kyegegwa Rural Energy Cooperative Society (KRECS); Pader-Abim Community Multi-Purpose Electric Cooperative Society (PACMECS); Kilembe Investments Limited (KIL); and Kalangala Infrastructure Services Limited (KIS). Umeme Co. Ltd. is the largest energy distributor in Uganda, distributing 97 percent of all electricity in the country.

Challenges in the energy sector

The challenges include the following:

  • Increasing urban and rural population;
  • High cost of funding
  • Development of adequate local expertise to manage the sector
  • High costs of transports of imported oil products for the production of power.
  • Insufficient standardization and quality control of petroleum products and inadequate enforcement and uncoordinated safety measures.
  • Lack of adequate awareness by both consumers and producers of the renewable energy alternatives and technology availability
  • The country has low generation capacity to meet the increasing demand;
  • Lack of sufficient institutional, legal & regulatory framework;
  • High upfront costs of renewable energy technologies which makes the energy quite expensive;
  • The energy development exercise must be made in an environmental friendly manner and consultations with environmental groups that  takes some time;
  • The income levels of the households in the rural sector are at moment quite low to afford electricity.

Investment opportunities

Uganda has a fully liberalized energy sector. Electricity generated by a private producer can be sold to the national grid. The government has prioritized solar energy development as a way of speeding up rural electrification. Generation of power from garbage does not exist in Uganda.  The investment opportunities are in the following areas among others;

  • Design, construction, sales and service support of biomass plants
  • Assembly and marketing of solar units in Uganda
  • Manufacture and marketing of charcoal briquettes
  • Acquisition, installation and services of micro hydro dams in Uganda

The information under energy sector is organized as follows;

Energy Sector Profile

Current State

Oil Sub-sector

The market

Key Operators

Facilitation by Government