Uganda: Future of Power Distributor Umeme at Stake Africa Intelligence Uganda’s power distribution sector faces an uncertain future as the government reevaluates the performance of its sole distributor, Umeme. The company’s concession to distribute electricity in Uganda expires in 2025, and there is growing debate over whether it should be renewed. Umeme’s Performance under Scrutiny Umeme, a subsidiary of Actis, has been operating in Uganda since 2005. Under its concession, it is responsible for distributing electricity to over 1.5 million customers. However, the company has faced criticism over its performance. Critics argue that Umeme’s electricity tariffs are too high and have become a burden on consumers. They also point to the company’s slow progress in expanding electricity access, particularly in rural areas. Government’s Options The Ugandan government has several options to consider regarding Umeme’s future. It could renew the company’s concession, negotiate new terms, or seek to bring in a new operator. If the concession is renewed, it is likely that the government will impose stricter performance targets and address concerns over tariffs. However, there is resistance to this option, as some believe that Umeme has not performed adequately to warrant a renewal. Another option is for the government to negotiate new terms with Umeme. This could involve reducing the company’s profit margins or imposing fines for poor performance. However, negotiations could be complex and time-consuming. Finally, the government could seek to bring in a new operator. This would require a competitive bidding process, and it is unclear whether any other companies would be willing to take on the challenges of operating in Uganda’s power sector. Implications for the Sector The decision on Umeme’s future will have significant implications for Uganda’s power sector. A renewal of the concession would provide continuity but may not address concerns over performance. New terms or a new operator could bring fresh perspectives and greater accountability, but they also come with risks and uncertainties. The government’s decision is expected to be influenced by the results of an ongoing review of Umeme’s performance. The outcome of this review will be crucial in determining the future of power distribution in Uganda.The current distributor of energy in Uganda, Umeme, is facing an uncertain future. There are several discussions and plans in place regarding a potential change in the energy distribution landscape in the country.The current distributor of energy in Uganda, Umeme, is facing an uncertain future. There are several discussions and plans in place regarding a potential change in the energy distribution landscape in the country. According to Africa Intelligence, the future of Umeme, which is responsible for distributing energy in Uganda, is at stake. The government is considering various options, including the establishment of a joint venture. The Ministry of Energy has indicated that the government is prepared to enter into a new electricity deal, as reported by NTV Uganda. This suggests that the government is open to exploring alternative arrangements for energy distribution. The Independent newspaper reports that the government is considering a joint venture as Umeme’s exit nears. This implies that Umeme’s role as the sole energy distributor in Uganda may be coming to an end, and the government is considering options for a new partnership. Uganda Radio Network also mentions discussions about a joint venture as Umeme’s exit approaches. The details of the joint venture, including potential partners and the scope of the collaboration, are still under discussion. These developments indicate that the energy distribution landscape in Uganda is undergoing significant changes. The government is exploring various options to ensure a stable and efficient energy supply for the country. As these discussions and plans progress, it remains to be seen how the future of Umeme and the energy sector in Uganda will unfold.Uganda’s electricity distributor Umeme faces an uncertain future as its concession expires in 2025. The government is considering various options, including extending Umeme’s concession, nationalizing the company, or inviting new bidders. Umeme has been operating in Uganda since 2005 and has invested heavily in the country’s electricity infrastructure. However, the company has also been criticized for high electricity tariffs and poor customer service. The government is keen to ensure a smooth transition to a new power distributor and has appointed a committee to study the options. The committee is expected to make recommendations by the end of the year. Umeme’s future is also being affected by the government’s plans to increase the share of renewable energy in the country’s electricity mix. The company is currently heavily reliant on thermal power generation, which is expensive and polluting. The government is encouraging the development of renewable energy projects, such as solar and wind farms. This could reduce Umeme’s market share and put pressure on its profits. The outcome of the government’s review will have a significant impact on Umeme’s future. If the company’s concession is extended, it will continue to operate in Uganda for the foreseeable future. However, if the government decides to nationalize the company or invite new bidders, Umeme could lose its dominant position in the market.