UGANDA
Opportunities and Demand for generation projects and tariffs in Uganda.
Eriasi KiyembaEriasi KiyembaManaging Director/Chief Executive OfficerManaging Director/Chief Executive Officer
UETCLUETCL
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Contents
Power sector reforms Power sector objectives Current status Generation projects Transmission line projects Tariff Structure in Uganda
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Power Sector Reforms
In line with power sector reforms and objectives, the Government of Uganda (GOU) has initiated a number of projects on a private-public-partnership arrangement as a strategy to address power generation requirements in the short and medium term.
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Power sector objectives
To make the power sector financially viable To increase sector’s efficiency To meet the growing demand for electricity
and increase area coverage To improve the reliability and quality of
electricity supply To attract private capital through private
sector participation To take advantage of export opportunities
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Power sector objectives (cont.)
The power sector has undergone reforms with the
objective of ensuring adequate availability of
affordable power and create a conducive
environment for private sector participation in the
power sector/economic development of Uganda
The Government of Uganda is committed to the
development and utilization of all available energy
resources and technologies.
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CURRENT STATUS
Over the last 14 years GoU has implemented a comprehensive power sector reform
Enacted a new Electricity Act in June 1999 Established an independent ERA in November 2000 Unbundled the UEB into successor companies in March 2001 Concessioned the generation business to ESKOM(U) Ltd in
November 2002 Concessioned the distribution business to UMEME in March 2005 Collaborated with the EAC and NBI on regional power
interconnection Established the REA in 2002 Formulated the Renewable Energy Policy in 2007 Launched the National Development Plan – (2010-2015)
GoU: Government of UgandaERA: Electricity Regulatory AuthorityREA: Rural Electrification AgencyNBI: Nile Basin Initiative
Uganda Power Sector
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Uganda Electricity Board
Uganda Elect ricity Uganda Electricity
Distribution Company
GENERATION SECTOR TRANSMISSION SECTOR DISTRIBUTION SECTOR
Nalubaale & Kiira Stations Concessionied
AES Bujagali IPP
Electricity Regulat ory
C U S T O M E R S
Uganda Electricity Board
Uganda Electricity Generation Company
Uganda Electricity Transmission Company
Transmission Operator System Operator Single Buyer
GENERATION SECTOR TRANSMISSION SECTOR
Private Generation IPPs
Distribution & Supply Concession (UMEME)Kilembe InvestmentsFerdsult Engineering servicesOthers
Electricity Regulatory Authority
C U S T O M E R S
Government policiesGovernment policies National Development Plan 2010-2015NDP Energy Targetsi. Increase generation capacity by an additional 3500MW by 2015
including 150MW from mini hydro plants
ii. Expand the transmission grid from the current 1300km to 2750km and increase the transmission voltage from 132kV to 220kV and 400kV
iii. Increase the consumption per capita from the current 75kWh/capita to 674kWh/capita by 2015 and 3670kWh/Capita in 2040.
iv. Increase rural electrification coverage to 20% by 2015
v. Reduce total system losses from 40% to 16% by 2015
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Government policiesGovernment policiesRenewable Energy Policy 2007
i. To increase the use of modern renewable energy, from the current 4% to 61% of the total energy consumption by the year 2017.
Sustainable Energy for all by 2030i. This is a UN initiativeii. Uganda was chosen as one of the pilot
countries
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Facts on demand vs supplyFacts on demand vs supply
Current peak demand : 484MW Installed capacity : 814MW
Current firm supply : 501.5MW Large hydro (465MW) Mini hydro (54MW) Bagasse (13.5) Currently zero thermal dispatch is
implemented. Demand growth rate : 10% per annum
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Current Generation Current Generation
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UETCL’S POWER SUPPLIERS
CATEGORY/SUPPLIER INSTALLED CAPACITY (MW) DISPATCH AS AT DEC 2012
LARGE HYDROS
ESKOM UGANDA LIMITED 380MW 215MW
BUJAGALI/BEL 250MW 250MW
MINI HYDROS
MPANGA/EMS 18MW 11MW
BUGOYE/TRONDER 13MW 7MW
KILEMBE MINES 5MW 2MW
KASESE COBALT 9.5MW 0MW
ISHASHA 6.5MW 3MW
KABALEGA 9MW 0MW
CO-GENERATION
KAKIRA SUGAR WORKS 12MW 12MW
KINYARA SUGAR WORKS 5MW 1.5MW
THERMAL
JACOBSEN UGANDA LIMITED (NAMANVE
HFO)
50MW 50MW
ELECTROMAXX (TORORO HFO) 50MW 50MW
Planned Generation CATEGORY/SUPPLIER PROPOSED CAPACITY (MW)
LARGE HYDROS
Karuma 625
Ayago 600
Isimba 188
Murchison Falls ---
Oriang 400
Kiba 400
Achwa 88
MINI HYDROS
Maziba 1
Nyagak 3 3.5
Kikagati 18
Waki 5
Muzizi 26/52
Kyambura 8.3
Planned Generation CATEGORY/SUPPLIER PROPOSED CAPACITY (MW)
MINI HYDROS CONT’D
Nyamwamba 14
Muyembe 10
Siti I&II 21.5
Lubilia 5.4
Rwimi 5.5
Nengo Bridge 7.5
Nsongezi 35
Kakaka 5
THERMAL AND SOLAR
Invespro 50
Albatros 50/230
Kabaale peat 33
Sesame Taylor 33
Geothermal 300
Namugoga Solar 50
Mputa (Gas) ?
Bujagali Hydro Power Project
Project description
• Development, construction and maintenance of a 250MW HPS on a Build-own-operate-Transfer (BOOT) basis.
• Bujagali Energy Ltd. (BEL) the project company supervised the construction of 100km of 220/132kV transmission lines on behalf of UETCL.
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Bujagali Hydro Power Project
• BEL the IPP sells electricity to UETCL under a 30 year PPA
• UETCL’s payment obligations under the PPA is guaranteed by the GOU through a government guarantee
• GOU signed an IA with BEL
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Project sponsor
The project sponsor is Industrial Promotions Services (Kenya) Ltd. {IPS(K)} and SG Bujagali Holdings Ltd.
IPS is the industrial development affiliate of Aga Khan Fund for Economic Development (AKFED), which promotes private sector initiatives and entrepreneurship through equity investment in Africa and Asia.
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Project sponsor
BEL is backed by IPS (Kenya) Ltd., and SG Bujagali Holdings Ltd. an affiliate of Sithe Global Power LLC.
The project was implemented on a IPP (PPP) arrangement. IPS raised financing on a 20:80 equity to debt ratio from various financiers i.e. IFC, AfDB, EIB, Nederlandse Financierings-Maats-chappij Voor Ontwikkelingslanden NV
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Thermal Power Projects• For all thermal power projects, the
development, construction and maintenance of project is undertaken by the private sector.
• The IPPs sell electricity to UETCL the off taker under short to medium term PPAs.
• Payment terms are on take or pay deals.• GoU signs an Implementation Agreements
with the IPPs to give waivers on duty on fuel as well as import and re-export duties on the power plants and accessories
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Thermal Power Projects
Year Plant Developer/IPP Project financing
2005 50 MW ADO Lugogo Aggreko I BOO
2006 50 MW ADO Kiira Aggreko BOO
2008 50 MW HFO Namanve
Jacobsen BOT
2008 50 MW ADO Mutundwe
Aggreko BOO
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Thermal Power Projects
Year Plant Developer/IPP
2008 12 MW Bagasse Kakira Sugar Works BOO
2009 20 MW HFO Tororo Electromaxx BOO
2009 5 MW Bagasse Kinyara Sugar Works BOO
2012 30 MW HFO Tororo Electromaxx II BOO
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Thermal Power Projects
Year Plant Developer/IPP
2012 20 MW Bagasse Kakira Sugar Works II
BOO
2014 57 MW Gas & Crude oil Kabaale
Jacobsen BOT
2014 35 MW Bagasse Kinyara Sugar Works II
BOO
2014 40 MW Kabale Peat Kabale Energy Ltd BOO
Mini hydro power Projects
• For all mini hydro power projects, the development, construction and maintenance of project is undertaken by the private sector.
• The IPPs sells electricity to UETCL the off taker, under long term PPAs.
• Payment terms are either on pay as you take or take or pay deals.
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Mini Hydro Power Projects
Year Plant Developer/IPP Project financing
2010 13 MW Bugoye Tronder Power Ltd BOO
2011 18 MW Mpanga Africa Energy Management Systems
BOO
2011 6.5 MW Ishasha Eco Power Ltd BOO
2012 3.5 MW Nyagak 1 WENRECO BOOT
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Mini Hydro Power Projects
Year Plant Developer/IPP Project financing
2012 9 MW Buseruka Hydromax BOO
2014 16 MW Kikagati Kikagati Power Co Ltd
BOO
2014 14 MW Nyamwamba Africa Energy Management Systems
BOO
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Hydro Power Projects
Year Plant Developer/IPP Project financing
2018 600 MW Karuma PPP BOOT
2016 200 MW Isimba Private sector BOOT
2017 600 MW Ayago PPP BOOT
2015 4.4 MW Nyagak 3 WENRECO BOOT
2015 26 MW Muzizi Private sector BOO (GoU?)
Transmission Line ProjectsProject financing
• Most of the projects have been financed by multilateral agencies i.e. AfDB, World Bank and bilateral agencies i.e. NORAD,NDF,JBIC, JICA,SIDA,DANIDA and GoU as well as through the tariff.
• In the recent past new financing institutions have shown interest in financing some projects i.e. KfW,China Exim Bank, India Exim Bank
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Transmission Line Projects
Year Project Project financing
2011 Bujagali Interconnection project
AfDB ,JICA & GoU
2014 220kV Bujagali Switchyard Upgrade
JICA & AfDB
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Transmission Line ProjectsYear Project Project financing
2014 132kV Mbarara-Nkenda AfDB & GoU
2014 132kV Tororo-Opuyo-Lira AfDB & GoU
2014 220kV Bujagali-Tororo-Lessos AfDB, JICA & GoU
2014 220kV Mbarara-Mirama-Birembo
AfDB, JICA & GoU
2015 220kV Kawanda-Masaka IDA & GoU
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Transmission Line Projects
Year Project Project financing
2014 Nkenda – Kabaale – Hoima project
NORAD/AFD
2015 132kV Mutundwe-Entebbe KfW
2015 132kV Opuyo-Moroto Islamic Development Bank & GoU
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Transmission Line Projects
Year Project Project financing
2016 Isimba Interconnection project NORAD ?
2017 Karuma Interconnection project NORAD/AfDB & JICA ?
2020 Ayago Interconnection project JICA ?
2016 220kV Hoima-Kinyara-Kafu NORAD ?
2016 132kV Lira-Gulu-Nebbi-Arua IDA ?
2016 132kV Mirama-Kabale AfDB ?
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Transmission Line Projects
Year Project Project financing
2016 132kV Mirama-Kikagati-Nshongezi
NORAD ?
2016 220kV Nkenda-Mpondwe-Beni NORAD under NELSAP ?
2016 220kV Masaka-Mwanza IDA ?
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Transmission Line Projects
Year Project Project financing
2016 400kV Karuma – Nimule - Juba
AfDB under IGAD & COMESA ?
2017 132kV Agago - Achwa
Interconnection 132kV
?
2016 132kV Bulambuli-Kachumbala and associated Mbale s/s
?
Tariff structure in Tariff structure in UgandaUganda• Transmission tariff
• UETCL acts as a single buyer and sole exporter and importer of power
• Prices between generation and transmission are bided or negotiated in form of Power Purchase Agreement
• UETCL sells power to distribution concessionaires at a Bulk Supply Tariff (BST)
• BST reflects the cost of power acquisition and transmission costs (O&M, ROI and mini investments cost provided in tariff)
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Tariff structure in Uganda Generation tariff
• The price paid by UETCL depends on whether the transmission company is paying for capacity tariff or energy tariff
The revenue requirement of generation component of tariff is made up of the following cost components
i. The investment requirementii. The operation and maintenance (O&M)componentiii. The concession fee or lease componentiv. Other costs such as regulatory fees and loyalties
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Tariff structure in Uganda Generation tariff cont’d-GETFIT• For small generation projects of less than 20MW,
feed-in tariffs are applied established by the Renewable Energy Policy (2007)
• Feed-In Tariff (REFIT Phase 1) run from 2007-2009 but had limited uptake by project developers
• In 2010, Renewable Energy Feed-In Tariff (REFIT Phase 2) commenced to encourage and support greater private sector participation in power generation from renewable energy technologies
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Tariff structure in Uganda Generation tariff cont’d-GETFIT Electricity needs in the short and medium terms
required a more aggressive program hence the special incentive scheme – GET FiT East Africa Program-Uganda pilot
The main objective is to assist East African nations in pursuing a climate resilient low-carbon development path resulting in growth, poverty reduction and climate change mitigation.
The premium of the Levelised Cost of Electricity will be paid as a top –up on the current REFIT levels
Annual monitoring review shall be every financial year and comprehensive review every 3years 36
Revised Tariffs (Usc/kWh)Technology Current
Refit TariffRevised LCOE
Premium increase over 20 years
Hydro(9><=20MW) 7.9 9.8 1.9
Hydro(1><=9MW) 9.1 11.1 2.0
Hydro(500kW><=1MW)
10.9 12.7 1.8
Bagasse 8.1 9.1 1.0
Biomass 10.3 10.9 0.6
Biogas 11.5 11.5 0.0
Landfill gas 8.9 8.9 0.0
Geothermal 7.7 7.8 0.1
Wind 12.4 13 0.6
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Challenges
Unstable hydrology which impacts on hydro power generation
Depreciation of the Uganda Shilling against foreign currencies
Raising oil prices on the international market
Lack of adequate spinning reserve
The Bulk Supply Tariff is not yet fully cost reflective.
Rampant vandalism of transmission lines
Timely disbursement of GoU subsidy to UETCL
Acquisition of way leaves
Securing funding for new investments
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Thank YouThank You
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