Parliament has approved a Cabinet request to borrow $482.5 million (about Shs1.4 trillion) from China’s Export–Import Bank to construct Isimba hydropower project.
The whole project will cost $567.7 million (Shs1.7 trillion). The repayment period for the loan is 20 years, including five years of grace and the interest rate is fixed at two per cent per annum.
Of the project sum, $550.8 million (about Shs1.6 trillion) will fund construction of the dam, $11m (Shs33 billion) construction of the Isimba–Bujagali electricity transmission line to evacuate power from Isimba to Bujagali and onward to sub-stations in Kampala.
A total of $5 million (about Shs15 billion) will be used to build the Isimba sub-station.
Completion of the project is expected in 2018 and government will sell each unit generated at Isimba station at $0.04 (Shs120).
Bujagali Energy Limited, which manages Bujagali hydropower plant, sells a unit at $0.11 (Shs330) whereas Eskom, which manages Kiira and Nalubaale hydropower projects, sells a unit at $0.01 (Shs30).
The generation companies and Uganda Electricity Transmission Company Limited, through the Power Purchase Agreements, agree on the generation tariffs after consideration of the cost and return on investment.
Ms Cecilia Ogwal, the Woman MP for Dokolo District, said the House had not been fully informed about certain aspects of the loan conditions.
“The Committee on National Economy has not tabled the Power Purchase Agreement so that we debate from an informed point. The agreement is so important since we are committing the country,” she said.
Ms Ogwal said they had not even read the bilateral agreement between Uganda and China about the power project.
$107 million (Shs321 billion): The amount Uganda has contributed to the project.
China Water International Corporation: The Chinese company constructing the plant.
183 megawatts: The power Isimba hydropower plant will generate.