5 May 2009 – The Ugandan government wants to lower electricity prices by 50% said energy minister Hillary Onek last week.
“We are re-examining the current electricity tariffs and my target is to reduce the prices by half,” the minister said.
“As Government, we want to reduce the cost of power so that the rural people can also afford to get connected to power. We are re-evaluating the electricity charges to enable increased productivity for Prosperity-For-All.”
Uganda currently has the highest electricity tariffs in East Africa, although these tariffs are heavily subsidised by Government. The high tariffs are attributed to reliance on thermal power along with an increase in the price of diesel.
The minister further said that the Government was planning on auditing power firms to establish the real cost of their investments.
“We want to know how much they have invested because this has been the basis for tariff increments. The Auditor-General will audit them and once it is established that the investments claimed are not correct, power tariffs should come down.”
Fred Kabagambe-Kaliisa, the permanent secretary in the energy ministry, explained that without the Government subsidies, consumers would pay much higher tariffs.
“There is need to look at the true cost of providing the service and evaluate if it is reasonable and affordable if the subsidies are removed. The important issue is to stabilise power supply and quality by evaluating new sources of electricity generation.”
Uganda generates 150MW of thermal power, and approximately 180MW from hydropower at Jinga and from the small hydropower dam at the Kilembe mines.