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15 May 2017

Uganda: Climate change shakes investors’ confidence in Umeme

In Uganda, changing weather conditions such as gale-force winds and heavy rainfall are causing an increase in power outages in certain parts of the country.

Speaking at a stakeholders' Annual General Meeting (AGM) last week, Umeme's Board of Directors' Chairman, Patrick Bitature, expressed concern that the national electricity grid could not handle increasingly stronger storms caused by climate change. Read more...

To this end, the climate change challenge has raised concerns from shareholders as this has resulted in increased power outages in certain parts of the country, the Independent reported.

"The environment we are living in today has changed considerably and we have taken cognisance of that. The winds we have are much stronger today in Kampala, we are not used to these gale-force winds and heavy rains," Bitature explained.

Distribution efficiencies

On a positive note, Bitature noted that Umeme has improved the distribution efficiencies from 50% to 80% through the reduction of energy losses from 38% to 19% in 2016, which he attributed to the company's anti-power theft campaign - dubbed as Wuuyo.

"Over the last 10 years, Umeme has improved the distribution efficiencies. These ensure financial sustainability of the sector operators and positive contribution to effective tariff reductions," Bitature stated.

According to media, he stated that the energy losses, averaged at 19.0%, is below the regulatory energy target of 16%.

Electricity penetration

He also pledged the company’s commitment to increasing electricity penetration rates, which are reported to stand at 21% of households using electricity, and 16% on the national grid.

"Our investment plans for the next period cover both the expansion of the distribution infrastructure and improving efficiencies," Bitature sated.

He added that "the alignment of our plans to upcoming generation, post commissioning of Isimba and Karuma hydropower dams, is key to the continued financial sustainability of the electricity sector."

Karuma and Isimba Hydropower Projects (600MW and 183MW respectively) are expected to be commissioned by December, 2018. Read more...

Bitature expressed optimism that the completion of the two dams will accelerate customer connections; hence leading to social and economic transformation of Uganda, media reported.

 

Featured image source: Big Stock

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