UMEME receives $25m loan
Jul 14, 2009
UMEME has received a $25m (about sh54b) loan to upgrade and refurbish the electricity distribution network in order to reduce power losses.
By Ibrahim Kasita
UMEME has received a $25m (about sh54b) loan to upgrade and refurbish the electricity distribution network in order to reduce power losses.
The International Financial Corporation (IFC), the World Bank’s private lending arm, provided the money that will also be used to improve quality of services and connect 20,000 new customers every year.
UMEME currently supplies power to over 300,000 customers. “This funding will be used to make additional improvements for our business and domestic customers, supporting the Government’s energy policy,†Charles Chapman, the managing director of Umeme, said.
The loan will contribute to Umeme’s $50m (sh108b) investment programme for 2009 and 2010 that aims at reducing technical and commercial losses of electricity.
The money comes at a time when Umeme is facing a Police probe and forensic audit over suspected inflated power tariffs. The Government is subsiding Umeme at a tune of sh92b a year. The injection is meant to cover the losses and keep the prices low. Despite this, Uganda still has the highest electricity tariffs in East Africa.
Uganda also has the highest percentage of power losses. A total of 34% of electricity gets lost due to theft and technical faults, according to Umeme officials, compared to 20% in Tanzania and Kenya.
Of the 34% losses in Uganda, 18% are as a result of theft, while 16% are due to technical reasons. However, Umeme claims it has invested considerable resources in mapping the entire electricity distribution network for the region, which will enable the company operate more efficiently.
Fred Kabagambe-Kaliisa, the permanent secretary in the energy ministry, noted that electricity was the engine of investment and industrial growth and essential to the long-term health and wealth of the nation.
“The Government is determined to see a drastic increase in electricity access in urban and rural areas,†he said. “The proposed investment by Umeme through this IFC facility will go a long way in meeting the Government’s goal of increasing electricity access.â€
Jean Philippe Prosper, the IFC director for eastern and southern Africa, said: “Since beginning operations in 2005, Umeme has connected almost 100,000 new customers and significantly reduced distribution losses.â€
“Umeme’s growth and commitment to quality is helping provide electricity to more Ugandans.â€
UMEME has received a $25m (about sh54b) loan to upgrade and refurbish the electricity distribution network in order to reduce power losses.
The International Financial Corporation (IFC), the World Bank’s private lending arm, provided the money that will also be used to improve quality of services and connect 20,000 new customers every year.
UMEME currently supplies power to over 300,000 customers. “This funding will be used to make additional improvements for our business and domestic customers, supporting the Government’s energy policy,†Charles Chapman, the managing director of Umeme, said.
The loan will contribute to Umeme’s $50m (sh108b) investment programme for 2009 and 2010 that aims at reducing technical and commercial losses of electricity.
The money comes at a time when Umeme is facing a Police probe and forensic audit over suspected inflated power tariffs. The Government is subsiding Umeme at a tune of sh92b a year. The injection is meant to cover the losses and keep the prices low. Despite this, Uganda still has the highest electricity tariffs in East Africa.
Uganda also has the highest percentage of power losses. A total of 34% of electricity gets lost due to theft and technical faults, according to Umeme officials, compared to 20% in Tanzania and Kenya.
Of the 34% losses in Uganda, 18% are as a result of theft, while 16% are due to technical reasons. However, Umeme claims it has invested considerable resources in mapping the entire electricity distribution network for the region, which will enable the company operate more efficiently.
Fred Kabagambe-Kaliisa, the permanent secretary in the energy ministry, noted that electricity was the engine of investment and industrial growth and essential to the long-term health and wealth of the nation.
“The Government is determined to see a drastic increase in electricity access in urban and rural areas,†he said. “The proposed investment by Umeme through this IFC facility will go a long way in meeting the Government’s goal of increasing electricity access.â€
Jean Philippe Prosper, the IFC director for eastern and southern Africa, said: “Since beginning operations in 2005, Umeme has connected almost 100,000 new customers and significantly reduced distribution losses.â€
“Umeme’s growth and commitment to quality is helping provide electricity to more Ugandans.â€