UETCL records 12% increase in energy purchases
What you need to know:
- During the period ended June 30, 2022, electricity purchases increased by 12 percent to 5,294 gigawatts per hour from 4,721 gigawatts in the same period in 2021
Uganda Electricity Transmission Company Limited (UETCL) has indicated that energy purchases increased by 573 gigawatt per hour (GWh) in the period ended June 30, 2022 due to sustained recovery of the economy from Covid-19-related challenges.
Details in the UETCL 2021/22 Annual Report, indicate that during the period, electricity purchases increased by 12 percent to 5,294 gigawatts per hour from 4,721 gigawatts in the same period in 2021, which saw generated revenues grow from Shs1.29 trillion to Shs1.35 trillion on account of increased sales resulting from the continued post-Covid-19 economic recovery.
However, despite growth in both sales and revenue, the company’s profits substantially reduced to Shs37b from Shs112.1b in the same period last year due to losses from foreign exchange volatilities and a rise in the cost of sales.
“… adverse foreign exchange movements on the company’s borrowings in foreign currency led to exchange losses of Shs116b [compared to forex gain of Shs107b in June 30, 2021],” the report, presented to shareholders among them ministries of Energy and Finance, reads in part, noting that the cost of sale (comprising the cost of energy purchase) rose to Shs1.17 trillion from Shs1.1 trillion, representing a 6.2 percent increase..
Mr Joshua Karamagi, the UETCL chief executive officer, said that whereas the company had returned a profit, its bottom-line had been impacted by a number of fundamentals including foreign exchange losses and inflation.
UETCL purchases bulk electricity from generation companies for onward sell to distributors.
The report was presented to Energy Minister Ruth Nankabirwa, who said UETCL was among the few government agencies that had returned a profit during the period.
The money will be used to fast-track implementation of ongoing and planned system expansion and network upgrade in a bid to match transmission with the expected increase in generation capacity.
Mr Kwame Ejalu Ejuku, the UETCL chairman, said there was need to provide UETCL with adequate revenue if it is to remain viable. For instance, he said the company currently requires a cost-reflective Bulk Supply Tariff to not only meet the single buyer costs but also operate, maintain and expand the transmission grid.