The Chairperson of Parliament’s Natural Resources Committee, Emmanuel Otaala, has informed the Budget Committee that the government is in talks to secure external funding of US$765.75 million (Shs2.920 trillion) to facilitate the takeover of the Umeme Concession which is due to expire in March 2025.
He made these remarks while meeting with the Budget Committee on Monday, January 29, 2024.
Otaala noted that, the government is required to provide the necessary financing to ensure a smooth transition and takeover, adding that the funds would not come directly from the government.
“Government should avail the necessary financing to ensure smooth transition and takeover from Umeme. The US$765.75 million that UEDCL requires, it says it has been consulting various financial institutions in the world to support it in this cause and they are positive about it. So, this money will not be coming from government directly, but from external funding,” Otaala said.
He said that Uganda Electricity Distribution Company Limited (UEDCL) wants US$540 million (Shs2.059 trillion), of which an initial investment of US$190 million is required during the takeover process, and the estimated buyout amount of US$225.75 million (Shs860.806 billion) is due to Umeme, but this is subject to a final report by the Auditor General, bringing the total cost to US$765.75 million (Shs2.920 trillion).
On December 8, 2022, Umeme issued a public notice indicating that the government of Uganda confirmed that Umeme’s current 20-year Concession, which expires on March 30, 2025, will not be renewed.
