Govt must invest more in power generation, says Umeme boss

The government has been urged to invest heavily in power generation or head for a catastrophe in the next three years as demand exceeds the level of generation capacity. As of March 31, Uganda’s electricity demand was growing at an annual rate of about 10.4 percent, yet the power purchased by Uganda Electricity Transmission Company Limited (UETCL) has only increased from 6,634.54 GWh in 2024 to 7,327.14 GWh in 2025.

According to Mr Selestino Babungi, the outgoing Umeme managing director, there could be power shortages in the next three years. He said this at the handover of Umeme’s power distribution concession, which ended yesterday, and the power distribution role went back to the government under Uganda Electricity Distribution Company Limited (UEDCL). “Currently, there is no major investment going on in power generation in the country, so with the increasing demand, we are heading for dark days by 2028,” he said, adding that power generation projects take many years.

Uganda has a power surplus of 300 megawatts with an installed capacity of 1,402 megawatts and a peak consumption of 1,100 megawatts.

Mr Babungi hinted at the planned 400MW plant on the Nile River under the permitting stage, and construction is expected in 2029, with power expected out in 2032, saying this is a long time, suggesting that solar energy could be the solution. At the time Umeme took over power distribution, there were 40,000 customers, but there are now 2.5m customers, with the business generating Shs2.5 trillion from Shs175b every year.

Mr Babungi said the government used to be the biggest net consumer, but there are now many domestic, small, large, and extra-large manufacturers, which has put Umeme among the top taxpayers in the country. Mr Paul Mwesigwa, the managing director of Uganda Electricity Distribution Company Limited (UEDCL), said starting today, they will be connecting the remaining customers that Umeme had not finished, but had been mapped. “Our main aim is to connect over three hundred customers by the end of the year as we already have cash financing of $74m (Shs269.3b) for undertaking operations,” he said.

Ms Ziria Tibalwa Waako , the chief executive officer of the Electricity Regulatory Authority, urged UEDCL to manage the assets effectively for the development of the country.

“Take charge of all that Umeme has left behind and attract more investment in the power subsector and also work transparently to attract investor confidence,” she said.

Meanwhile, Energy minister Ruth Nankabirwa said to ensure the continued efficiency of the electricity distribution system, Cabinet approved the borrowing of up to $190.1m (Shs691.8b) to finance the buy-out amount for Umeme Limited and an additional $50m (Shs182b) for UEDCL’s investment requirements.