Energy industries (renewable-/ non renewable sources)
Republic of Uganda
Uganda has long suffered from lack of electricity and the problem has become acute in recent years. While the emergency thermal generation program of the Government will help to address short term needs, the Project is needed to address the medium and long-term need for economical, large-scale, power generation in Uganda. Electricity in Uganda is very expensive compared to international benchmarks. The reason is Uganda’s significant dependence on imported petroleum products.
The current generation mix of hydropower and thermal energy has an average cost of USD 0.27 per kWh in 2007. After commissioning of the Bujagali hydropower plant, the cost of power for the consumer in Uganda is expected to stabilise at USD 0.17 per kWh and therefore eliminate the need for the Government of Uganda subsidy. In addition to high prices, the shortage of electricity has led to daily load shedding. During load shedding parts of the grid are disconnected to secure stability of supply in the remaining parts. Power shortage and subsequent load shedding is a significant barrier to further economic development of Uganda.
Benefits to the environment
The Bujagali Hydropower Project would reduce the emissions of greenhouse gasses in Uganda. The Project will particularly target CO2 emissions that in the absence of the project activity would have been generated through a combination grid connected power plants. The electricity produced by the Bujagali Hydropower Project will displace the electricity produced in the baseline, which to a large extent is based on diesel and heavy fuel oil generators that emit considerable volumes of CO2. It will also avoid the need for future oil fired generation.
Sustainable Development, Economic & Social Benefits
The Project will provide access to electricity from renewable energy sources. Since the Project will stabilise or lower the power tariff in Uganda and will eliminate the need to load shed, it also stimulates sustainable economic development of the country, creating new jobs both directly and indirectly.