Uganda has set an ambitious agenda to develop its substantial energy and mineral resources, promote economic development, end energy poverty, and lead the country to a just energy transition. Uganda's stated objective in Vision2040 is to transform into "a modern and prosperous country", ensuring a b Contact online >>
Uganda has set an ambitious agenda to develop its substantial energy and mineral resources, promote economic development, end energy poverty, and lead the country to a just energy transition. Uganda''s stated objective in Vision2040 is to transform into "a modern and prosperous country", ensuring a better future for its citizens. The energy sector will play an important role in helping Uganda achieve this.
Uganda is endowed with abundant natural resources, including fertile soils; petroleum deposits; and reserves of iron ore, phosphates, copper, cobalt, aluminium and gold. The agricultural sector employs over 80% of the workforce, mostly in subsistence farming. Uganda had a population of 47million in2022, around 25% of which was urban. The country''s fast population growth has undermined efforts to increase access to modern energy.
Final energy consumption was about 16800 kilotonnes of oil equivalent (ktoe) (703petajoules [PJ]) in2021. Traditional biomass, mostly wood and charcoal used by households for cooking, accounted for around 87% of the total. Around 11% of final consumption was in the form of oil products, mostly petrol and diesel for transportation. Only around 2% was in the form of electricity, most of which was from hydropower. Households accounted for 61% of final energy consumption, industry 22%, transportation 7%, and commercial and public services together consumed around 9%.
The National Energy Policy for Uganda 2023 focuses on expanding the electricity transmission and distribution grid networks; increasing energy efficiency; promoting the use of alternative sources of energy; and strengthening the policy, legal and institutional framework. Uganda has developed a number of subsectoral policies, including the 2008National Oil and Gas Policy (currently under review), the Renewable Energy Policy (2007), and the Electricity Connections Policy (2018).
In recent years, Uganda has improved the coverage, quality and timeliness of energy balances and related data. Although Uganda is a leader in the region in terms of energy statistics, as in many other countries, data collection, organisation and quality control often are not allocated sufficient and consistent resources.
While electricity represents only around 2% of Uganda''s total energy consumption, over 80% of generating capacity is based on hydropower. Most of the remainder is also renewable, including several solar photovoltaic (PV) installations and thermal power plants that burn sugarcane bagasse. The significant reliance on hydropower has implications for energy security, particularly due to uncertainties surrounding future climate change impacts on the region''s water resources.
Uganda increased its electricity generating capacity from about 320megawatts (MW) in2002 to over 1346MW at the beginning of 2023 and now has a significant surplus relative to its peak demand of about 800MW. The Karuma hydroelectric power plant, expected to come fully online in2023, will add a further 600MW.
Investment in transmission and distribution has not kept pace with generation, resulting in an inability to fully use a significant share of the country''s generating capacity. Since past power purchase agreements (PPAs) signed with the state-owned system operator have often included take-or-pay clauses, the government has had to pay for energy that it has not been able to use, adding significantly to the cost of power.
The government has avoided subsidising electricity consumption. However, high tariffs have prevented many customers from consuming power, even when initial connections are subsidised. This, in turn, has made it challenging to finance grid extensions, as well as operation and maintenance; lowering the cost of power is one of the government''s priorities.
Amendments to the Electricity Act passed in 2022 include the possibility for net metering and for generators to sell directly to customers instead of to the transmission company, which has served as the single buyer. However, regulations allowing market participants to take advantage of such measures have yet to be implemented.
The government has a scenario to develop a 1000MW nuclear power plant by 2031 and another 1000MW plant by2040 in anticipation of rising demand. It is working with the International Atomic Energy Agency (IAEA), considered to be in Phase2 of the IAEA Milestone Approach, and has signed non-binding agreements with companies in the People''s Republic of China (hereafter "China") and the RussianFederation (hereafter "Russia") to explore options.
Approximately 92% of Uganda''s generating capacity is renewable, of which about 80% consists of large hydro, 8% sugarcane bagasse-fired plants and 4.5% solar PV plants. Uganda aims to increase its non-hydro renewable electricity generating capacity, particularly from solar. It introduced PPAs with feed-in tariffs for renewable energy projects under 20MW in2007.
Individual and commercial solar systems can help the government meet its electrification targets and spur economic development in rural areas. However, the market for solar home systems and components has been significantly undermined in recent years by faulty installations, the import of substandard systems and poor after-sales service.
Uganda appears to have significant geothermal potential, which could help reduce the power system''s dependence on hydro. The main challenge for geothermal development in Uganda is the significant resource uncertainty and geological risk that private investors must bear in the absence of detailed data.
Given the high level of organic content in the country''s municipal waste, significant increases in the urban population, and constraints on land available for new dumps and landfills, waste-to-energy projects appear to be a particularly promising way to diversify the energy supply. The government also hopes to develop biofuels and build up domestic production capacity.
Achieving universal access to clean and reliable energy sources for electricity and cooking remains a challenge in Uganda and is a high priority for the government in achieving economic and social development.
With around 30% of the population having access to electricity and less than 6% having access to clean cooking fuels, Uganda continues to have one of the lowest electrification and clean cooking rates in sub-Saharan Africa. Although the share of people with access to clean cooking fuels has rapidly increased since 2010, the rapid population growth has led to the actual number of people without access to effectively increase. In its National Energy Policy 2023, the Ugandan government aims to reach universal access to electricity and 50% access to clean cooking by2040.
As of 2022, around 20% of the Ugandan population had access to electricity from the national grid, while a further 10% received electricity from solar home systems capable of providing a basic package of energy service. Another 20% benefitted from limited access through smaller solar lighting devices such as solar lanterns. It is estimated that approximately 50% of the country''s health centres and 20% of its schools have access to electricity, either through grid or off-grid solutions.
Low power demand undermines the entire power system, thereby contributing to grid instability and an unreliable supply that, in turn, undermines consumption. Further, the scattered and sparse settlement patterns of the predominantly rural population compound the cost and complexity of the country''s electrification efforts, making it necessary to consider both on- and off-grid solutions.
Around 95% of households rely on either wood or charcoal as their primary energy source for cooking, creating both social and environmental concerns. High reliance on biomass is contributing to deforestation in parts of the country. Millions of Ugandans are negatively affected each year by indoor pollution from cooking with biomass, which disproportionately impacts women and children.
Challenges include the high costs of improved cookstoves and fuels compared to biomass (which when collected is often perceived to be free), the lack of financing for stove distributers and potential customers, insufficient distribution infrastructure for liquefied petroleum gas (LPG), and cultural and awareness barriers. Even when households adopt clean cooking technologies, they often do so incompletely, continuing to use biomass for much of their cooking needs.
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