2024-01-04 07:28:02
Uganda estimates it will pay electricity distributor Umeme Limited about $225 million to enable it to recoup its investments in the national grid after its concession ends in March 2025, a senior official at the ministry of electricity has said. ‘energy.
Umeme, which is listed on the neighboring Ugandan and Kenyan stock exchanges, operates a 20-year electricity concession in Uganda, which began in 2005.
The Ugandan government has rejected the company’s request to extend its concession when it ends next year. Under the terms of the concession, the government must pay Umeme all unrecovered capital investments at the end of the agreement.
“Today we have an idea of the amount of the buyout… we are approximately around $225 million,” Irene Batebe, permanent secretary of the Ministry of Energy and Mineral Development, told the private broadcaster NTV Uganda late night Wednesday to Thursday.
This was the first time the government had indicated how much Umeme stood to gain in unrecovered investments.
Mr Batebe added that the government’s auditor general would conduct a final review of Umeme’s investments in the national power grid to determine the final amount to be paid to the company.
The government also plans to engage a private company in a joint venture with the state-owned Uganda Electricity Distribution Company Limited (UEDCL) to operate the network after the end of the Umeme concession, Batebe said.
The selection of the private sector operator will be done through a competitive process, and UEDCL will retain the majority of shares in the partnership, she said.
Uganda’s electricity generation capacity is estimated at around 1,400 megawatts. (Reporting by Elias Biryabarema; Editing by George Obulutsa and Muralikumar Anantharaman)
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