27 September 2013 – Uganda plans to spend US$500 million to double the length of its power grid in four years. The country wants to expand its electricity generation infrastructure before its planned start of crude oil production by 2017.
At the 15th annual East African Power Industry Convention (EAPIC) held in Nairobi during September Simon D’Ujanga, Uganda’s state minister for energy, said the country plans to expand its power lines from 1,700 km to 3,400 km. "We have six transmission line projects being implemented concurrently." Projects included lines serving domestic markets in Uganda, a separate line connecting it to Kenya and another to Rwanda.
In June 2013, Uganda signed a contract granting China’s Sinohydro a tender to build the 600 MW Karuma dam on the Nile River at a cost of US$1.65 billion. Uganda is depending on Karuma to generate sufficient cheap power to meet fast-growing energy needs and support an economy eyeing double-digit growth rates once crude oil production starts. Growth is projected at about 6% this fiscal year. Work on the Karuma dam had started in August 2013 and it should be commissioned in about 60 months.
In addition to Karuma, Uganda also plans to build a smaller hydro power plant, Isimba, on the Nile at a cost of US$600 million. The engineering, procurement and construction (EPC) contract for Isimba was signed earlier in September.
D’Ujanga also says that Uganda plans to increase the amount of electricity generated from bagasse to 100 MW in the next four years from 55 MW at present. He says the Ugandan government has established renewable energy feed-in tariffs to create a predictable business environment for renewable energy projects. The government, with support from development partners, has launched the GET-FIT top-up support on the renewable energy feed in tariff to fast-track the development of mini hydro projects. The government also set up the Uganda Energy Credit Capitalisation Company (UECCC) to provide support in form of credit enhancement instruments, to local financial institutions.