UETCL sustains growth, expanded capacity

by Mmeeme Leticia Luweze
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In the fiscal year 2022/23, the Uganda Electricity Transmission Company Limited (UETCL) reached new heights, with strong sales revenue and expanded capacity. Uganda Electricity Transmission Company Limited (UETCL) stood out, reporting a significant profit increase of Shs95 billion. This success was supported by favourable exchange rates.

“Because we report in shillings, all our borrowings that are denominated in foreign currency recorded a decrease in terms of the amount we have to pay in terms of shillings. Sh60b of the sh95b profit came from foreign exchange gains,” explained Joshua Karamagi, the company’s CEO, during a press interview.

Additionally, the company observed a 7% increase in power sales due to high demand and supply dynamics. According to the UETCL annual report, electricity sales volumes grew by 7.0% from 5,055 GWh to 5,409 GWh, driven by increased domestic and export demand. Revenue from energy sales also rose from Ugx 1,350.4 billion to UGX 1,385.7 billion, representing a 2.6% annual growth rate.

The report also highlighted that the average annual transmission losses rose to 4.79% for the year ending on June 30, 2023, up from 4.28%, surpassing the Electricity Regulatory Authority’s target of 4.65%. This increase in losses was attributed to the evacuation of power from mini hydro on the 33kV lines from embedded generation plants and uncompleted projects.

UETCL equally faced challenges, notably outstanding debts of 166 billion shillings owed by various ministries, government agencies, and departments for unpaid power bills.

Addressing the issue, Ruth Nankabirwa, Minister of Energy and Mineral Development, and emphasized the imperative for government-wide intervention. Recognizing that the problem of doubtful debts extends beyond the company’s purview, she stressed the need for all government agencies to fulfill their financial obligations regarding electricity consumption.

To address this challenge comprehensively, plans were initiated to engage these agencies and ministries with outstanding bills. Nankabirwa announced her intention to directly contact Permanent Secretaries to ensure timely payments and effective resolution of the issue.

In her words, Minister Nankabirwa stated, “We have realized that the issue of doubtful debts extends beyond the company itself; it requires the involvement of the entire government to address. Government agencies that are not paying for the electricity they are consuming need to step up and fulfill their financial obligations. To tackle this issue, we have decided to reach out to these agencies and possibly Ministries that have outstanding electricity bills. I would like to take this opportunity to inform the Permanent Secretaries that I will be contacting them to ensure prompt payment.”

Supporting this initiative, Evelyn Anite, State Minister of Finance for Investment and Privatization, shed light on the financial landscape within these ministries and departments. Anite underscored that funds for electricity bills were allocated in their budgets and disbursed accordingly. However, despite this allocation, resources were redirected to other priorities, resulting in unpaid power bills. Anite echoed Nankabirwa’s call for prioritizing electricity payments, emphasizing its critical role in maintaining operational efficiency within government offices.

The UETCL annual report for the fiscal year ending on June 30, 2023, highlighted significant advancements in Uganda’s energy sector. Notably, efforts to fortify the country’s energy infrastructure were evident through the addition of 14.7 MW of new generation capacity, facilitated by projects like Nyamwamba 2 and SM Hydro. This expansion raised the installed capacity to 1,372 MW, promising enhanced energy production capabilities to meet the evolving demands of consumers and industries.

Additionally, the report emphasized a noteworthy uptick in investment in non-current assets, with a surge of 6.8% from UGX 3,767.97 billion to UGX 4,024.03 billion. This growth, fueled by the capitalization of commissioned company projects and accumulation of capital work in progress, signifies sustained investment in the energy sector’s long-term sustainability and resilience.

UETCL is committed to supporting Uganda’s Vision 2040 and the Energy Policy 2023 to provide development paths and strategies to operationalize Uganda’s Vision Statement of “A Transformed Ugandan Society from a Peasant to a Modern and Prosperous Country within 30 years”. 

The UETCL annual report highlights the company’s alignment with Uganda’s Vision 2024 electricity generation capacity target of 52,481 MW. This alignment is achieved through the planning of infrastructure to evacuate the generated power, with evacuation plans incorporated into the company’s Grid Development Plan. Additionally, UETCL has successfully upheld the availability of the grid infrastructure at 98% and is actively striving to enhance availability to the targeted 99%

Uganda Electricity Transmission Company Limited (UETCL) was incorporated as a limited company on the 26th of March 2001 by the provisions of the Companies Act as amended and the Public Enterprise Reform and Divestiture Act.

UETCL’s existence is provided for in the Electricity Act Cap 145 which provided for un-bundling the Uganda Electricity Board (UEB) into successor Companies and the establishment of the Electricity Regulatory Authority (ERA). UETCL purchases electricity in bulk from generating companies and sells the electricity in bulk to distribution companies throughout Uganda. 

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