The Uganda Manufacturers Association (UMA) members, the largest consumers of electricity in Uganda, accounting for at least 70% of electricity consumption as of to date, are set to meet the minister of Energy and Minerals Development Ruth Nankabirwa, to discuss how the sector can increase power/ electricity uptake, among other issues.
This is massive and it underpins the centrality of manufacturing in Uganda’s economic transformation journey; which is why it is a key pillar for National Development Plan Three (NDP3).
In a statement, UMA says the one-day engagement organized in conjunction with the Uganda Electricity Regulatory Authority, will also aim at sensitizing UMA Members on how the Members can leverage the current electricity regulatory environment to tap into a reduction of power cost to US Cents 5/KWH in line with President Museveni’s pronouncement.
Sensitization of UMA Members on how manufacturers can purchase power directly from the generators/transmitters following the changes in the Law that can now allow this to happen, sharing an update on the development of the Regulation (s) on the direct purchase of power for manufacturers.
Also part of the meeting, will be sharing of the progress made by the ESI to promote power reliability emanating from the increased outages and vandalization of electricity infrastructure across the country; Sharing of possible PPP Projects in the ESI to explore the possibility of attracting the participation of UMA members in such project financing and development since some UMA members of shown interest in participating but lack information and sharing of UMA Tax Proposals to the Government of Uganda that can reduce revenue requirements for the ESI which is key for electricity tariff reduction.
They will also discuss on the current constraints to Local Content Mainstreaming in the ESI that is impeding optimal post-COVID-19 recovery and Sharing of a comprehensive compendium of goods and services that the ESI can source locally.
The dialogue will take place on February 15, 2023, starting at UMA Head Office, it will be chaired by Nankabirwa.
The manufacturing sector has continued to show reasonable resilience in terms of recovery from the global economic distortions caused by the COVID-19 Pandemic which was worsened by the Russia-Ukraine conflict as evidenced by the manufacturing sector’s posting 2.7 trillion Shillings Tax Revenue contribution at end of the Quarter Two of FY 2022/23 representing 22.67% contribution.
President Yoweri Museveni has repeatedly complained that expensive private capital was responsible for high electricity tariffs in Uganda, which makes it unaffordable for consumers.
In 2021, Nankabirwa hinted at a possibility where UMA members and big sector players will be able to buy electricity directly from generators or the transmission company to lower the electricity tariffs.
She said the energy ministry is currently spearheading the amendment of the Electricity Act 1999 to lower the end-user tariffs for manufacturers.
The manufacturers have for years complained to President Yoweri Museveni about the high electricity costs arguing that it has made them uncompetitive in the East African region and beyond.
At the end of 2022, Government also revealed that it would not renew South Africa power firm Eskom’s licences to run two hydropower stations when they expire in March this year, as part of plans to bring the electricity sector under government control to reduce costs to consumers.
The government will create the Uganda National Electricity Company Limited (UNECL), a state-run company to manage the generation, transmission and distribution segments of the electricity sector, the ministry of energy and mineral development said in a statement.
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