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MPs approve sh34b loan for regional power interconnection

By Henry Sekanjako

Added 2nd June 2017 09:25 AM

In May 2009, the government secured US$7.59m to finance electricity transmission and interconnectivity to neighbouring countries of the Nile Equatorial Lakes countries.

Parliament 703x422

In May 2009, the government secured US$7.59m to finance electricity transmission and interconnectivity to neighbouring countries of the Nile Equatorial Lakes countries.

 

Parliament has okayed the government, to borrow $9.54m (sh34.3b) as supplementary loan, from the African Development Bank Group, to help in the interconnection of Electric grids of Nile Equatorial lakes countries.

In May 2009, the government secured US$7.59m to finance electricity transmission and interconnectivity to neighbouring countries of the Nile Equatorial Lakes countries.

The countries include; Uganda, Rwanda, Kenya, Democratic Republic of Congo (DRC), and Burundi. However, the money was not enough given the volume of work.

The approved loan will cover financing gaps, related to the construction of transmission lines and substation, project supervision and audit, and operating costs for project implementation unit.

In its report to parliament, regarding the loan, the Parliament’s committee on national economy, which examined the loan, on Tuesday, told the House that the project is aligned with priority investment areas of the Uganda National Development Plan (NDP-II), and Uganda’s Vision 2040 goal of improving electricity infrastructure.

“ Unforeseen ground conditions and terrain resulting in changes in transmission line towers and foundation types, occurred due to transmission line crossing on swampy area and hilly landscape which increased the cost,” Lawrence Bategeka (Hoima Municipality), the vice chairperson National economy committee defended the  additional loan.

The MPs noted that since Uganda is part of the East African Community (EAC), when planning for infrastructure project connecting within the region, there is need for the government, to take into account the projected infrastructure in the region, in order, to avoid the mismatch manifested in the project.

They also implored the government to consider selling off its excess power to avoid paying for the redundant capacity.

Currently, the country is engaged in construction of more hydro power projects such as Karuma, Isimba, which are projected, to produce more power.

“The government should consider, constructing a complete system to evacuate power and also distribute it in order to minimize on losses incurred when the government constructs infrastructure without ready transmission and distribution lines like in the case of Bujagali where we are paying for redundant capacity,” Bategeka said.

High power tariffs

In a heated debate however, the House chaired by Deputy Speaker Jacob Oulanyah, expressed concern over the increased high power tariffs, despite the excess power produced in the country.

The MPs also expressed reservations about the loan, saying there is no need for government to borrow money for cross border power connection, when most of the districts in the country especially in West Nile, are still in the dark.

“It is true we need power to facilitate regional trade; however we should first help our people access power internally. As a country, we haven’t yet addressed the issue of electricity, power lines are just bypassing people’s homes,” Mathias Mpuuga (Masaka Municipality) said.

Gideon Onyango Samia Bugwe North added; “It is not bad to borrow money for an important project like this, but we cannot think about extending power to cross borders , when our local people are still suffering , we need to get statistics on rural areas that need power”.

The legislators, also asked the government to ensure proper use of the loan, saying most of the previous loans approved by parliament, have not been accounted for.

They expressed fear that the continued borrowing by the government may increase Uganda’s debt burden to unmanageable levels.

However in response, David Bahati , the state minister for finance, in charge of planning assured the House, that the loan would be used for the intended purpose, adding that Uganda’s debt was within the limit compared to other EAC countries.

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