The government has reaffirmed its preparedness to take over Uganda’s electricity distribution network from Umeme Limited, with the transition set to be managed by the Uganda Electricity Distribution Company Limited (UEDCL) starting April 1, 2025.
Energy minister Ruth Nankabirwa said the government is fully ready to assume control of the concession and is committed to ensuring improved service quality, a seamless transition, and addressing power reliability challenges.
“The government is fully prepared to take over the Umeme concession through UEDCL by April 1, 2025. We are committed to improving service quality, ensuring a smooth transition, and addressing power reliability challenges,” Nankabirwa said.
However, the takeover comes amid concerns raised by the Auditor General’s office over the Shs692.688 billion ($190 million) loan that the government seeks to secure from Stanbic Bank Uganda for Umeme’s buyout.
The Auditor General has called for a delay in Parliament’s approval of the loan until a thorough audit of the figures submitted by Umeme is completed.
Joseph Hirya, director of Audit in the Office of the Auditor General, said that discrepancies in Umeme’s submitted figures required further scrutiny before final figures could be presented.
“We request a few more days, not beyond March 28, 2025, so that we can provide the actual figures,” Hirya told Parliament’s Committee on National Economy. “It is better to pay interest on the loan knowing that it is based on accurate figures.”
Hirya also clarified that the reports submitted to Parliament were not final and would undergo further quality checks before being signed off. He stressed that the delay was necessary to ensure the integrity of the financial figures guiding the buyout decision.
The Ministry of Finance, Planning, and Economic Development is finalising arrangements to secure $50 million (Shs185 billion) through internal borrowing to support UEDCL’s capital investments.
These funds, expected to be available by the end of next week, are meant to ensure UEDCL is financially equipped to sustain and enhance electricity distribution services.
Despite this, concerns have been raised about UEDCL’s readiness to assume control of the distribution network. Engineer Ziria Tibalwa, chief executive of the Electricity Regulatory Authority (ERA), told Parliament on Tuesday that the transition remains a challenge due to financial constraints and inadequate investment in preparation for the takeover.
“We aren’t even ready with the $50 million for UEDCL to start, yet the concession agreement wouldn’t allow UEDCL to step in,” Tibalwa said.
She suggested that early investments in collaboration with Umeme would have made for a smoother transition.
Power outages across the country have further exposed the difficulties surrounding the shift, with Tibalwa attributing them to clauses in Umeme’s concession that prevent government intervention until the contract officially ends.
Addressing staffing concerns, the Ministry of Energy emphasised that UEDCL’s restructuring process is designed to enhance efficiency, eliminate role duplication, and ensure cost-effectiveness in electricity distribution.
The recruitment process, the ministry noted, has been conducted transparently and on a merit basis to ensure that the most qualified personnel are retained.
Nankabirwa, however, remains focused on securing Parliament’s approval of the loan and finalising the buyout process before the March 31 deadline.
She urged lawmakers to expedite the matter, warning that any delays could lead to costly interest penalties.
“The government must move quickly to ensure a seamless transition,” she said, adding that any discrepancies between figures provided by the regulator, the Auditor General’s office, and an external consultant would be addressed promptly.
