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Tribunal to rule on Shs37 billion Umeme case

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By NELSON WESONGA

Posted  Tuesday, March 11  2014 at  02:00

In Summary

No proof. The case is in regard to whether Umeme’s 540,000 customers should pay the company Shs37 billion for distributing more electricity than had been projected.

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The Electricity Disputes Tribunal will today determine whether Umeme’s 540,000 customers should pay the company Shs37 billion for distributing more electricity than had been projected.

The power distributor argues that the Electricity Regulatory Authority’s (ERA) decision in 2012 to amend Umeme’s Power Supply License is “oppressive and commercially unviable”.

Through the amendments, ERA did away with the bonus the government was paying Umeme whenever Uganda’s installed power generation capacity would increase.

The regulator argued that if any entity should be rewarded, it should be the electricity generators, and not the distributors.
ERA also sought to recover the difference between what Umeme would claim it had paid as income tax and what it had actually paid.

Umeme’s take
Umeme, which distributes 97 per cent of the electricity in Uganda, is unhappy. “We have a contention on amendments number two and four,” Umeme’s head of communication, Mr Henry Rugamba, told the Daily Monitor during a telephone interview yesterday.

In its appeal, Umeme said: “It is proposed to ask the Tribunal orders that the decision by the Respondent to amend the Appellant’s License for the Supply of Electricity No. 048 be set aside.”

The Tribunal had dismissed in 2012 the case because Umeme would reportedly never show up for proceedings. However, a fortnight back Umeme asked the Tribunal to revive the case.

Umeme’s decision to run to the Tribunal comes just after its request to ERA to approve an increment of the power tariffs to enable it cover the loss of revenue from excess energy sales.

cap: Some of the transformers at Nalubaale Power Station in Jinja. FILE PHOTO