By Jannette Mugisha
Evidence on how no economy can progress or employ its resources maximum without affordable electricity is overwhelming in Uganda. Our electricity distributer UEDCL signed off their primary role through a lease and management agreement to Umeme Ltd effective 2005.
In 2005, Peak demand was 380 megawatts while available supply was 190MW creating a deficit of another 190 MW megawatts leading to load shedding. Today in 2017, Peak demand has risen to just about 550 MW while available supply ready for consumption is 700 MW (We have more than 150MW of undemanded power). Karuma and Isimba will double available electricity to anything north of 1400MW
In 2005, total consumer connections was 298,000 while that figure is now 1,100,000 customers (Consumers more than tripled but consumption has failed to even double). During the same period interval, Uganda’s population rose from an estimate of 25 million to 40 million.
The proportion of the population using electricity for home cooking and cottage industries like bakeries has fallen flat. Evidence is found in the forest cover that has reduced from 4 to 1.8 million hectares between 2005 and 2015
The UBOS, Uganda National Household Surveys (UNHS) between 2005/06 and 2016/17 have clearly shown how as a country, we have lost the poverty battle to PRODUCTIVITY of our agricultural outputs.
Using the Q4, 2016 period, Umeme bought a kilowatt hour or a unit of electricity at Shs. 260.9/= and sold it to you on your yaka meter Shs.696.9/= for a domestic consumer (This figure excludes 18% VAT). This big margin between buying and selling price borders treason or what in Luganda they call okulya munsi yo olukwe.
The distribution tariff is so high that you will probably never get a publication of the Weighted Average Distribution Tariff in Uganda under the Umeme regime.
It’s no longer commercially viable to do agro processing without stealing electricity due to the tariff level. Maize our staple crop is sold by poor farmers at as low as Shs.500 as farm gate price because the value chain must factor in an affordable end user price that is affordable to all households including the urban poor.
Over to you the economists in Bank of Uganda and Ministry of Finance, Planning and Economic Development, Uganda to continue blaming the slowing economy on poor rains and our failure to re-export Chinese made merchandise to South Sudan.