Electricity firm on the spot over breach of contract

Electricity. Nalubaale hydro power dam in Jinja District. Both Nalubaale and Kiira hydro power stations generate a combined capacity of 380MW.

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Accused: As the company charged with operating the government’s power plants to generate electricity, Escom, has been accused of flouting the terms of the agreement it signed, Ismail Ladu delves into the subject.

A report seen by Saturday Monitor has revealed that Eskom Uganda Limited (EUL) is not living up to the terms of the 20-year concession it signed with Uganda Electricity Generation Company Limited (UEGCL) about 15 years ago.
The report, which reviewed the performance of the South African electricity company was prepared by UEGCL at the close of last year.
It indicates that EUL is transferring money out of the country without reinvesting it into the power plant, contrary to the conditions of the concession.
However, in a detailed response, Eskom contests the findings of the report, saying on the contrary, everything possible has been done to implement the Concession and Assignment Agreement (CAA) to the letter.
The 2002 CAA signed between UEGCL and EUL requires the South African electricity company to maintain and operate Kiira and Nalubaale hydroelectric power stations for a period of 20 years.
The two power dams, located in Jinja, eastern Uganda, generate a combined capacity of 380MW.
But findings of the report reveal a number of shortages, key among which include the failure to run the 15 key units in the complex. Only 13 are fully operational, which negatively impact on power generation capacity and availability.

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