Uganda ends EUL 20-year concession
The government decision to terminate the power generation concession for the South African power firm, Eskom follows a Parliamentary Natural Resources Committee visit to the Power station in 2019 who accused the company of failing to make investments in maintenance in power generation aspect.
By Joseph Mazige
Kampala: Eskom Uganda Limited that has operated and maintained Kiira and Nalubale power stations under a 20-year concession comes to its natural end on Friday March 31st, 2023, Ideashouse has learnt.
The Electricity Regulatory Authority Corporate and PR Director Mr Julius Wandera said the Government has taken over the management of the Power stations.
“Its already done and the handle was conducted on Monday,” Mr Wandera said, adding that Uganda Electricity Generation Company Ltd (UEGCL) has already that so and all formalities addressed.
The government decision to terminate the power generation concession for the South African power firm, Eskom follows a Parliamentary Natural Resources Committee visit to the Power station in 2019 who accused the company of failing to make investments in maintenance in power generation aspect.
Nalubaale Dam also known as the Owen Falls Dam was constructed in 1954. It had a lifespan of 50 years.
Contracts Governing EUL Operations
The operations of EUL business are governed by the four contracts, license and shareholder compact and the company’s desire to be compliant with prudent utility practices. The four contracts and license that govern us are:
The Concession and Assignment Agreement, This agreement is between EUL and Uganda Electricity Generation Company Limited (UEGCL). Signed in 2002, it provides the framework that allows EUL to operate and maintain the Nalubaale and Kiira Power stations for an agreed period of 20 years, for a concession fee.
The Power Purchase Agreement (PPA): this agreement is between EUL and Uganda Electricity Transmission Company Limited (UETCL), and it provides for the purchase of the power by UETCL. UETCL is the only customer mandated by the Government of Uganda to buy and transmit power in the country.
The support Agreement (SA): this agreement is between The Government of Uganda and EUL. This agreement stipulates guidelines to ensure EUL adheres to the agreed curve, which is monitored and regulated by the Directorate of Water Development (DWD). It also ensures that EUL adheres to the water permits issued by DWD.
The Generation License Agreement: this was signed between Eskom Uganda Ltd and Electricity Regulatory Authority (ERA), the government’s electricity sector regulator in 2002. In addition, EUL has to operate within the conditions of the generation license which allows the company to generate and sell electricity.
