Uganda has one of the world’s lowest per capita consumption rates of electricity, and a low access level of 27%, a legacy of the country’s dire energy track record in past years. However, the situation is improving quickly – and with more power generation coming online Uganda has ambitions to link into the growing regional power grid to export electricity.
As a Lower Middle Income Country and having an electricity supply industry with an ability to pull in commercial finance, a significant proportion of European ODA funding takes the forms of concessional loans which have an average grant element of 55%, while still being supplemented with a generous amount of purely grant funding.
European-supported projects include the 45MW run-of-river Muzizi hydroelectric power plant which received loan commitments from France’s AFD and Germany’s KfW, worth EUR 45 million and EUR 40 million respectively, as well as a EUR 21 million grant from the European Commission. Another notable achievement is the roll out of the GET FiT programme, which was supported by a EUR 15 million grant from Germany’s BMZ in 2014. The programme aims to fast-track 20 small-scale renewable generation projects totalling 218MW, all of which are promoted by private developers, to add much-needed clean generation capacity, help to strengthen regional grids and result in emissions reductions of 11 million tons of CO2.
Overall, investment into Uganda’s energy sector is increasing, with global ODA commitments and private sector investments growing fourfold from EUR 46 million in 2014 to EUR 191 million in 2019. Its encouraging regulatory environment and vast renewable energy potential – an estimated 5,300MW – mean Uganda has a good chance of becoming an SDG7-compliant regional energy power.