UMEME mulls USD5 million Marshall plan for Kiwatule-Najjera cluster

April 27, 2020 in Business, Companies, Energy, Infrastructure by Editor

Umeme Chief Executive Selestino Babaungi says remedial works for the Ntinda-Najjera settlement corridor will commence after the Covid-19 lockdown is lifted.

Uganda’s national power distributor Umeme is planning a massive infrastructure upgrade to address the frequent outages  in Kiwatule, Buwate and Najjera. Umeme chief executive Selestino Babungi says he has signed off $5 million in capital expenditure for the area.

“You are going to see a lot of network upgrade works once the lock down is lifted,” Selestino told 256BN.

Demand growth in the area has overtaken the capacity of infrastructure as settlement shifts from standalone dwellings to apartments. This has exerted pressure on all utilities including telecoms and water. Also, the migration of commercial activity from the CBD to the suburbs, has seen many small-scale industrial operations hook on to lines designed for domestic use. This has caused instability in the network, Selestino explained.

Residents have reported frequent power outages, some lasting as long as four days at a time.

“In the past, the Umeme teams would respond fast but it now takes days. Even when they do, power is only available for a few hours before service is interrupted again,” says Simon, a resident of Buwate.

Selestino compared the problems in the area to what residents along the Kampala-Entebbe road corridor experienced a few years ago. A sharp rise in settlement saw a spike in demand, leaving utilities playing catch-up.

“The entire Ntinda area all the way to Kira is  seeing a lot of high density buildings going up, so we need to upgrade the transmission lines, transformers and substations.

“I have already signed off USD5 million in Capex for that purpose and work should be getting underway sooner than later,” Selestino says.

Umeme secured a USD70 million syndicated loan from a consortium of lenders led by the International Finance Corporation last December. The proceeds will support the revamping and expansion of the electricity distribution network.

Uganda is already struggling with a generation surplus of nearly 600Mw, piling yet more pressure on Umeme to unlock pent-up demand. Another 600Mw in new generation is expected to come on line when the Karuma Hydro Power Station is commissioned later this year.

Besides improving supply integrity in high growth areas, Umeme aims to double electricity connections to 3.2 million customers by 2025.  It must also phase out post-paid metering for all single phase customers and trim system losses to 13pc by that date.