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Years of Powering Uganda

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Umeme is the No.1 electricity distributor in Uganda ISSUE: 01 March 2021 NOT FOR SALE 16years of powering Uganda We are at the Umeme forefront of safety promotion, innovation and investment to serve our customers. Inspection of the line in Asinget Village, Tororo district. Joseph Balikuddembe/UmemeImages Published by Umeme Limited 2nd Floor Rwenzori House, Plot 1, Lumumba Avenue, P.O Box 23841, Kampala, Tel: 0312 360600. Editorial Team Editor Peter Kaujju Deputy Editor Stephen Ilungole Writers Jonathan Adengo Nelson Wesonga Designed by Brian Onyango Micheal Wamakuyu Photography by Brian Onyango Micheal Wamakuyu Joseph Balikuddembe How power theft is a great 24 danger to you 11 27 Energising Masaka City Powering industry for growth COVID-19 remains a safety and development 33 concern to business Reliable electricity, a key driver 35 of the health sector How transformer vandalism ent 37 affects you Board Chairman’s 01 Foreword Managing Director’s 03 Note 07 Editor’s Note Umeme cuts customer journeys 13 through service innovations 59 Cont Energy sector ready for new generation Tracing the evolving story of 19 Uganda’s electricity sector Why Umeme spent $2 million 39 on transformer injections Q&A with Dr. Mary 41 Goretti Kitutu, Q&A with Eng. Ziria 68 Tibalwa Electricity spurs growth 45 of SME’s in Uganda Q&A with Selestino 51 Babungi Mbale City tapping from 71 electricity investments 75 Safety is key in schools Extending a hand 78 of help Energy sector players 81 unveil Association Gulu City gears for more development as sector 92 87 invests in electricity reliability Enabling tourism in Fort Portal City Board Chairman’s Foreword n behalf of the Board, I am pleased to present power quality and network expansion to grow the our inaugural Umeme Pulse Magazine, customer base and achieve access targets. a quarterly magazine highlighting the O performance of the business and the sector To fund the projects, we tabled a $219 million (about Shs813.2 billion) budget proposal for 2021 before the Uganda’s economic growth has declined to 3.1% as a Electricity Regulatory Authority (ERA) for approval. result of the COVID-19 pandemic. We note that the The sustainability of the electricity sector is dependent severely affected sectors are services, tourism hotel, on a fair regulatory regime that balances the interests education, transportation and industrial production on of the varying stakeholders, while ensuring sustainable account of reduced demand. financial structure for the operators. The COVID-19 pandemic continues to affect countries In the spirit of growing electricity demand and drive to and businesses. The risks arising from this pandemic tariff reduction, the Electricity Regulatory Authority include market, services and supply chain disruptions. introduced a declining block tariff regime, that encourages industrial consumers to increase their “The electricity sector was identified as an consumption as the marginal incremental units essential service provider” consumed compared to the prior year are charged at reduced tariffs. The cost of production is one of the I am pleased to note that Umeme has remained attributes investors consider in their investment resilient despite the challenging times. We have location decision. continued to deliver on our customer promises, operational and financial pillars. Umeme welcomes and continues to support the Government’s ambition of achieving further tariff reductions, through delivering efficiencies especially The Electricity Supply Industry energy loss reduction and increase in sales units, while optimizing its cost structure. Umeme is prioritizing investments in the distribution backbone to support the growing customer base. I am I look forward to further engagement with you glad to note that the we completed all our investment through this among other platforms. projects approved by the Regulator for 2020. Umeme spent $83.3 million (about ShsX310 billion) in 2020 to ramp up capacity enhancement and network stabilization programme in rapidly growing regions “ across its footprint. The money is part of the $450m Umeme spent $83.3 (about Shs1.7 trillion) for the 2019 and 2025 million in 2020 to ramp investment agenda. The immediate projects that will up capacity enhancement take a chunk of our investment kitty in 2021 include and network stabilization evacuation of new generation capacity, energy loss “ programme. reduction, strengthening the network to improve Umeme Pulse Magazine - 01 Patrick Bitature Board Chairman Umeme Limited Managing Director’s Note Investments for growth ECP meme has been at the core of growth and The Government of Uganda had ea ier suspended the development of Uganda through powering free Electricity Connection Policy (ECP) due to lack of businesses. Ever since we took over from funds in 2020. The free electricity connections policy U Uganda Electricity Board, we have registered was launched in 2018 for a 10-year period ending in tremendous progress across all the growth metrics. 2027, with the prime objective of increasing electricity Customer numbers have increased from the 290,000 we access and providing cleaner energy to Ugandans. inherited in 2005 to over 1,600,000 today. We have The new policy direction provides an opportunity to brought down energy loses from 38% in 2005 to 16.4% serve customers willing to meet their connection costs today and have invested heavily on the network. without undue delays. The Electricity Regulatory Authority has provided guidance on the implementation Cumulatively, Umeme has invested over $700 million mechanism and we have resumed connections. into Uganda’s power distribution network to-date. In 2020 alone, Umeme spent USD83.3 million (about UGX310 billion) to step up capacity and network We would like to reassure our stakeholders of stabilisation in rapidly growing regions across the Umeme’s commitment to supporting Government’s country. agenda of empowering communities through job creation and increased household incomes by providing The 2020 plan, which was part of a larger USD450m reliable electricity. (UGX1.7 trillion) for the 2019 and 2025 investment agenda, was in support of Uganda’s National We are proud of the journey we have walked with Development Plan focusing on increasing grid Ugandans thus far. connections, demand, reliability of supply and driving efficiencies. The 2020 investment focused on 6 critical areas of the business, which when completed, will see us improve supply reliably. The six areas included; addressing energy losses and Customer numbers “ improve operational efficiency (USD 26.89 million); have increased from the addressing load demand growth (USD22.72 million); 290,000 it inherited in power supply reliability (USD18.89 million); power “2005 to over 1,600,000 generation evacuation and supply (USD10.79 million); today. network systems automation (USD1.93 million) and network protection and security (USD2.06 million). Umeme Pulse Magazine - 03 Selestino Babungi Managing Director Umeme Limited Supporting industrialisation with • USD1.32 million (UGX4.9 billion) spent on reconfiguring the Gulu substation to increase reliable power its capacity from 5MVA to 10MVA and improve the old substation infrastructure and We have invested heavily across the board address the overloading of the existing power transformers. • Invested $15.2m (about Ugx55.7b) into two big power projects to boost electricity supply • Replaced obsolete power transformers and quality and reliability in the Mbale City and the switchgear at the Ntinda substation with new Elgon subregion. 33kV gear to address the quality of supply in the Ntinda area at a cost of USD2.1 million • Invested $9.23m (about Ugx34b) in the Siti 2 (UGX7.8 billion). Project -which includes a 125-kilometre 33kV single circuit double power line, evacuating • USD1.7 million (UGX6.3 billion) was also power from the 16.5MW Siti 2 Hydro Power injected into a new substation in Nakawa, Project on River Siti in Bukwo District to Kampala to address the growing power Umeme’s new upgraded sub-station in Mbale demand from housing developments and industrial areas in the Nakawa and Bugolobi • Invested $5.99m (about Uugx22b) in the areas. Mbale Industrial Park Project – which includes a 75km power line, bringing up to 25MW from • In Entebbe, to meet the growing needs of the Uganda Electricity Transmission Company real estate sector as well as the ongoing Limited’s (UETCL) substation in Tororo to the Entebbe Airport expansion, a new Mbale Industrial Park. substation is being built at Nakasamba in Entebbe at a cost of USD1.38 million • 3.4 million investment in the Mukono North (UGX5.1 billion). substation to provide National Water’s Katosi water station, Tian Tang, and Kampala Cement • Other projects include USD1.81 million factories, among other industrial consumers of (USD6.8 billion) to be injected into network power, with reliable and quality power. refurbishment in Njeru Municipality, Jinja district, as well as USD1.8 million (UGX6.7 billion) • USD1.82 million (UGX6.8 billion) switching allocated to injecting new transformers in the station at Matugga on the northern outskirts of network across the country. Kampala City to enable network reconfiguration and network operational efficiency around the Liao Shen Industrial Park, Kapeeka and the surrounding Bombo area. The 2020 plan, which was part of“ • USD1.66 million (UGX6.2 billion) will be spent a larger USD450m (UGX1.7 trillion) on replacing the Bombo substation. for the 2019 and 2025 investment agenda, was in support
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