Power Tariffs To Stay

Aug 14, 2001

The new domestic power tariffs are to stay, energy minister Syda Bbumba said yesterday.

By J. Odyek, C. Musoke, Annette Birungi and Allan Tatyama The new domestic power tariffs are to stay, energy minister Syda Bbumba said yesterday. “To get a nice baby you need delivery pain. We have to go through the pain now of increased tariffs,” she said while appearing before the parliamentary committee on natural resources. Bbumba said the new tariff was internationally competitive. “Kenya’s domestic tariff is 10 cents compared to Uganda’s 10.4 cents per kilowatt-hour. Uganda is also competing very well with Tanzania. Argentina is 14 cents, Brazil 12 cents and Cuba 14 cents,” she said. The committee said it would make a decision on the matter on Thursday when Bbumba with her team appear again. She said the power sector needed US$2.1b investment over 10 years which Uganda Electricity Board cannot get from the profits it makes. She said Uganda exports power at 8 cents to Kenya and needs to earn more from its export. Bbumba said UEB made a profit of sh9.7b last year and made a sh5b saving after curbing power thefts. She said there was an urgent need to make power supply reliable, such that industries and production are not sabotaged. She said power export also needed to go up. She said the government was negotiating with the finance ministry to have taxes on energy saving devices reduced. She said the Government was also negotiating with a Scottish developer to invest in the manufacture of energy saving electrical materials locally. Committee chairman Hillary Onek said Ugandans were too poor to afford the new tariffs. He said UEB was operating at 48% efficiency and that the hiked tariffs were making Ugandans pay for UEB’s inefficiency. He said UEB made a profit last year from the old tariffs and its improved performance did not warrant high tariffs. The MPs said Bbumba’s ‘baby’ could become stillborn as private power generators were being frustrated and that the hiked tariffs were pushing production costs high and leading to job losses. They said UEB was being privatised and there was no need to increase its tariffs. Ken Lukyamuzi (Lubaga South) said the tariffs would lead people to resort to charcoal, damaging the environment. Nsubuga Nsambu (Makindye West) said the Electricity Act was meant to enhance access to power but it had instead failed. MPs said the energy saving bulbs cost sh15,000, too costly for the poor. Meanwhile, youth yesterday staged a peaceful demonstration at Parliament against the recently increased electricity tariffs. Geoffrey Kamali reports that the youth, led by Pastor Martin Sempa, also sent a letter to the Speaker, Mr. Edward Sekandi, in which they denounced donors and the privatisation of UEB. The youth were accompanied by an old woman from Natete, a city suburb, Frances Namuli. “This is not just painful, it is unacceptable. We can no longer accept to be guinea pigs of the World Bank. The impact of this mistake is huge,” Sempa said. Ends

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