Energy

Energy (79)

Museveni Vows To Bring Electricity Costs Down

The government of Uganda is working towards harmonizing electricity tariffs and make the utility product cheap for both domestic and manufacturing, President Yoweri Kaguta Museveni said Tuesday during his State of the Nation Address at Serena Hotel in Kampala.

Currently the two leading producers of electricity Nalubaale and Bujagali sell electricity at different prices.  Nalubaale sells at 1.04 US cents per unit while Bujagali is at 11UScents per unit. These prices are still on the high. Consumers especially manufacturers continue to complain saying these high prices leave them will little profit.

“By a combination of measures, we shall resolve this handicap in a win-win way. The future electricity stations, especially, the big ones, will never be expensive in the same way.” The president stated.

The cost of power and supply deficit have been a mainstay despite the power generation capacity and volume increasing. The supply is increasing with every project government is undertaking. Uganda now has a generation capacity of 850mgws of electricity compared to the 60mgws of 1986.

President Museveni promised that an extra 1000mgws of electricity will be added onto the national grid in the next five years by working on Karuma, Isimba, the minihydros, the geo-thermal in Lake Katwe, the gas-powered stations and those using HFO (Heavy Fuel Oil).

“We already have a surplus of 100mgws during even the peak hours in the evening (6:00p.m to 10:00p.m). At night only 350mgws is consumed. During the off-peak hours of the day, 500mgws are consumed. Therefore, during the night hours after 10:00 p.m., the surplus is 500mgws.

“That is why I would encourage some factories to work at night. The only problem we have are the high prices of electricity caused by the expensive money the Bujagali developers used. We shall get a solution for it.

“With this better base of electricity and the improved roads, we are now, for the first time, in a position to decisively tackle the haemorrhage by attracting and incentivizing investors that will save the huge money in dollars that we are currently donating to India, China, UAE, Japan, EU, USA, etc. ─ a total of US$5.528 billion per year.

“This huge amount of money goes for textiles (US$888million), leather goods (US$0.22million), fruit products (US$20.2million), second hand cars (US$568.7million), carpets, etc. etc. All these can now be made here.

“Fortunately, the investors are there. They just need a good atmosphere for investing. What is the good atmosphere needed? First of all, now that the electricity is abundant, we need to ensure that it is cheap for, at least, manufacturing ─ not more than 5 US cents per unit. This, we have started implementing.” The president confirmed.

Sinohydro Promises Hospitals For Karuma Community

The contractor undertaking the construction of Karuma Hydroelectric Power Station has pledged to construct hospitals to help residents of Karuma community. Chinese construction firm Sinohydro Corporation is undertaking the construction of the 600MW dam.

“In the next 3years, we will commit to construct hospitals and schools worth millions of dollars for the communities which together with Karuma Project will form a significant part of our monument”. Deng Chang-Yi the Deputy Manager of Sino Hydro said.

Deng Chang-Yi was speaking at Karuma Primary school in Northern Uganda during an event at which the Corporation offered free medical care and treatment to hundreds of resident from both banks of Karuma dam.

The medical day, which is part of the Company’s CSR initiatives, saw a team of Chinese Medical Experts including doctors and nurses from China, spend Saturday diagnosing a myriad of ailments and administering treatment to the people of Kamdini and Kiryadongo districts.

Deng Chang-Yi said the Company’s mandate has not ended with construction of the dam but also extended to improving the living conditions of the people around the project area. He added that they have integrated CSR in their operation and strategic planning.

“The neighboring communities have been with us every step of the way. As a gesture of good will and part of our commitment to “give back” to the supporting communities. To date, we have made donations of school supplies and learning materials to Karuma Primary School, drilled boreholes and wells for the Village around Karuma.

We have also renovated several access roads for the adjoining villages and provided road accident rescueincluding the initiation of this Free Medical Service. All these activities are aimed at enhancing our bond and fostering a harmonious environment,” Deng Chang-Yi said.

Isaac Mwesigwa, Uganda Electricity Generation Company limited (UEGCL)’s Sociologist, hailed Sinohydro for the good gesture of providing free medical services to communities but urged them to keep it in regular basis.

He said government is working on a Community Development Action Plan that will see most of the health centers in both banks of the project upgraded. Chu Mao Ming, the Political Counselor of the Chinese Embassy in Uganda said the Free Medical Day was a demonstration of the cordial relationship Uganda has with the People’s Republic of China.

Karuma Dam Spillway Cracks Remediable – Experts

This will come as good news to President of Uganda Yoweri Kaguta Museveni who had lost patience with the engineers working on the Karuma Hydropower Project. The president accused the contractor of the 600MW dam Sinohydro Corporation China of poor performance when the infrastructure developed cracks.

In March, 2016, an angry Museveni summoned the line minister Irene Muloni and tasked her to correct the wrongs of the contractors. In a reactionary move, experts from Sinohydro Corporation China were brought in to study the mishaps.

And now, a team of dam construction experts from Sinohydro has said the cracks which were reported on the spillway at the Karuma Dam currently under construction are just common cracks that happen in the construction industry and are remediable.

The experts say that the cracks which had caused panic therefore won’t affect the overall functionality of the 600MW dam. This assertion is contained in a report the experts handed over to Uganda Electricity Generation Company Limited (UEGCL) this week following three weeks of intensive investigations.

Following a visit to the dam recently, the Minister of Energy and Mineral Development Irene Muloni instructed that work on the Spillway be put on hold and investigation be carried out to ascertain the impact of the Cracks on the overall functionality of the dam. 

Acting on the Minister’s directive, the team of Experts from Sinohydro, led by Mr. Yang Yixin arrived in Uganda on 20th April to carry out detailed investigation and has handed over a report with remedial steps to be taken to Uganda Electricity Generation Company Limited (UEGCL).

“The cracks after treatment with appropriate methodology shall have no adverse effect on the overall dam structure and its functionality. Sinohydro has commenced the procurement of equipment and materials for the treatment of cracks”, the report stated.

According to the report, the experts in a course of three weeks worked in conjunction with over 30 specialists in design and construction of concrete works on the ground and in China to analyze the causes of cracks and formulate remedial measures.

The team was to draft draft preventative/improvement measures to be adopted in concrete works construction based on the study of the drilled cores and construction methodologies and finalized the Report on Dam Concrete Crack Analysis and Preventative/Improvement Measures and submitted to OE, UEGCL and the Owner for assessment and approval within the one month time prescribed by the Minister of Energy.

Korean Firm To Build 40MW Power Plant In Uganda

Uganda’s electricity production will increase by 40MW a year if Zion Korea Limited Company, a firm from South Korea, goes ahead with their plans of investing in the country’s energy sector. The company’s delegation was in Kampala last week to meet the country’s leader President Yoweri Museveni.

According to a statement released by the president’s office, Museveni told his guests, who were led by the Chief Executive of the South Korean company, Jeon Koang Woo, that the ambitious investment plans are in line with the government’s efforts to create wealth and jobs.

Jeon Koang Woo said their company aims at building a power plant in Uganda with an output capacity of 40 Megawatts annually offering direct employment opportunities to 2,000 employees and indirect working opportunities to 3,000 workers. He also added that the company, in addition to direct power production, will manufacture solar panels and batteries.

Museveni, therefore, observed that the power plant investment venture that the South Korean entrepreneurs are going to establish in Uganda is welcome. The President emphasized that Uganda needs more power production ventures in order to ensure that industrial establishments and wananchi (citizens) access electricity at favourable cost per unit.

Uganda’s electricity demand has been growing at an average of 10% per annum which has led to occasionally power outages because the supply is low. To curb this deficit, Uganda with the help of developing partners and developers are undertaking new projects that will substantially increase supply.

At the moment Uganda produce hydroelectricity power at Adekokwok Hydroelectric Power Station (8MW), Bugoye Power Station (13MW), Bujagali Power Station (250MW), Kabalega Power Station (9MW), Kanungu Hydroelectric Power Station (6MW), Kiira Power Station (200MW), Mpanga Power Station (18MW), Mubuku I Power Station (5MW), Mubuku III Power Station (10MW), Nalubaale Power Station (180MW), Nyagak Power Station (3.5MW), Kisiizi Power Station (0.3MW) and Gwere-Luzira Power Station (0.5 kilowatts).

Some of the projects under construction include Isimba Power Station (183.2MW), Karuma Power Station (600MW), Nyagak III Hydro Power project (5.5MW) and Maziba Power Station (5MW). Uganda also proposed to develop 13 hydroelectricity power projects including Ayago Power Station in Nwoya district that will produce 600MW. Once all these projects are operational, the country will substantial power supply and a low cost.

Museveni Suspends Karuma Engineers

 

Three Ministry of Energy and Mineral Development engineers working 600MW Karuma Hydropower Project on the Kampala – Gulu highway have been suspended over shoddy work. The call to suspend the underperforming engineers was made by President Yoweri Museveni on Wednesday.

According to Chimpreports, a local news website, the affected officials are Principal Energy Officer Eng. Henry Bidasala – Igaga, Eng. Cecelia Menya, former Ag. Permanent Secretary Eng Paul Mubiru, and unnamed Ministry’s Senior Accounting Officer.

The website also mentioned that the permanent secretary ministry of energy Kabagambe Kaliisa was interrogated by a team from the president’s office and was likely to lose his job. Kabagambe couldn’t readily be reached to verify the news but recently the president wrote to Irene Muloni the energy minister asking her to review the work being undertaken at Karuma and Isimba Hydroelectric Power Station.

In the letter, a tough talking Museveni said he had “got disturbing reports that the work being done on the dams of Karuma and Isimba is shoddy because the 'owners' engineers' are either not serious or they have some other issues.” Museveni asked Muloni to suspend the project if there was need.

“Mistakes are being observed at Karuma. The 'owner's engineers' are informed but they do nothing. I, therefore, direct you to, at once, confirm if these stories are true so that you stop further and more irreversible mistakes,” the president wrote in the letter date 22 March, 2016.

He added: “If it is necessary to suspend work until the defects are corrected, it should be done. The 'owners' engineers' could either be re-enforced or even dismissed.” Karuma was contracted state owned Chinese firm called Sinohydro Corporation. It is being funded by Exim Bank of China.

One of the affected engineers, Principal Energy Officer Eng. Henry Bidasala – Igaga, during a field tour with journalists recently said that Karuma would be ready by December, 2018 when the six turbines will be up and running. He told journalists that 30 percent of the construction work was done including excavation works.

Norwegian Firm Set For Partial Bujagali Takeover

 

Norwegian Hydropower Company SN Power is set to buy into Bujagali Hydropower Project, a new report released this week has indicated. The state owned Norwegian firm has agreed with SG Bujagali Holdings (SGBH) from Mauritius on the sale of the latter’s partial interest in Bujagali.

Bujagali is a 250 MW hydropower facility located in Jinja, Uganda.  It was developed, financed and will continue to be operated by Bujagali Energy Limited (BEL), which is owned by affiliates of the Aga Khan Fund for Economic Development (AKFED), SGBH and government of Uganda. 

The affiliates of AKFED and GOU will retain their interests in Bujagali.  The project’s debt financing arrangement with its lenders, including development finance institutions such as the African Development Bank, World Bank Group and European Investment Bank, will not be affected by the transaction.  

The acquisition will provide a platform for SN Power to develop additional hydropower projects in Uganda and Sub-Saharan Africa.

Thomas DeLeo, Director, SGBH revealed that SGBH has owned its interest in the Bujagali project in Uganda for eleven years, through initial development, construction and full operation. He said they are extremely proud of the contribution the project has made catalyzing transformation of the country’s power sector. 

“Uganda has incredible potential, and we have seen myriad ways in which Ugandan businesses and consumers have benefited from reliable electricity since Bujagali came online.  Now that we have completed our goal of proving Bujagali’s operational strength with operations above a 99% contractual availability over the past 3 ½ years, SN Power will be the ideal partner to continue this legacy for Uganda, given its world-class operating capabilities, global portfolio, financial strength, and proven commitment to the highest social and environmental standards.“ 

Torger Lien, Chief Executive Officer, SN Power explained that they look forward to a strong and enduring partnership with the Government of Uganda, as well as the operating and lending partners of Bujagali Energy Limited, in contributing to the critically important goals of materially enhancing Uganda’s installed generation capacity and providing a greater share of Ugandans with access to electricity.  

“With consistent power, businesses can grow, agricultural producers can prolong the shelf-life of their products, hospitals and clinics can better provide for their patients, and schools can keep the lights on for a new generation of students.  SN Power is seeking a long-term investment in Uganda that will sustain Bujagali’s transformational, positive impact.” 

The Bujagali Hydropower Project is widely considered the most successful public private partnership in the power sector in Sub-Saharan Africa and has been used as a model for subsequent projects in the region.  Bujagali was commissioned in August 2012, putting an end to years of constrained economic growth caused by an insufficient and unreliable power supply in Uganda.  

Key improvements include: 

  • Bujagali replaced thermal generation that cost over 30 US cents/kWh with renewable power at 11 cents/kWh, enabling the GOU to discontinue annual subsides that cost Uganda USD 175 million per year and to channel these savings toward other crucial public sector investments.
  • Over Bujagali’s nearly four years of operations, the project has provided a reliable backbone for the Ugandan grid, averaging over a 99% contractual availability factor and generating half of the country’s power supply.
  • Of critical importance to Uganda’s economic competitiveness, Bujagali reduced the marginal cost of electricity generation by 66%, catalyzing strong economic growth since coming online. 

The project sponsors, led by IPS an affiliate of AKFED, were selected in April 2005 through an international competitive tender overseen by the GOU based on the lowest return on equity.  At the end of the concession, Bujagali will be transferred to the GOU for one US dollar with an expected remaining life of 70+ years.  

SN Power, which is owned by Statkraft and Norfund, is one of the world’s leading international hydropower firms.  With Statkraft, SN Power has a strong industrial foundation built on more than 120 years of developing, owning and operating hydropower projects in Norway and abroad.  

Statkraft is wholly owned by the Norwegian state and is the largest renewable energy and hydropower company in Europe, with a total installed capacity of more than 18,000 MW.  Statkraft’s gross sales amounted to USD 8.7 billion in 2014.  

Norfund is a Norwegian development financial institution, which invests in private enterprises in Africa, Asia and Latin America.  Through Norfund, SN Power has access to significant experience and expertise in conducting investments in emerging markets, particularly in Uganda and Eastern Africa.  SN Power’s investment in Uganda will complement the company’s commitment to building sustainable hydropower in Africa, building on prior investments in Zambia’s Mulungushi and Lunsemfwa Power Stations. 

SGBH, a company incorporated and doing business in Mauritius, is one of the original shareholders of BEL and an affiliate of Sithe Global Power, LLC (“Sithe Global”), an international power development company.   

Sithe Global is led by a seasoned management and technical team with extensive experience developing and operating large scale, socially responsible power generation projects.  The Sithe Global management team has successfully developed over 50 power projects in nine countries with a capital investment in excess of USD 5 billion.

SHODDY WORK: Museveni Considers Suspending Karuma, Isimba Power Dams

 

President Yoweri Museveni is considering suspending the construction of multimillion electricity generation dams at Karuma and Isimba because the contractors have continued to do shoddy work even when it has been brought to their attention.

In a letter to the minister of energy and minerals Irene Muloni dated 22nd March, 2016, the president revealed that he had “got disturbing reports that the work being done on the dams of Karuma and Isimba is shoddy because the 'owners' engineers' are either not serious or they have some other issues.”

The president in the same letter received by the ministry on March 23rd, 2016, a day later, goes on to explain that the contractors do not detect faults and do not insist on correcting them. President Museveni therefore demanded “prompt action” from the minister including considering to suspend ‘work until the defects are corrected,’

“My information for instance, points out that there is something known as draft tube, where the turbines are supposed to sit. These draft tubes should be assembled outside the hollow structures that are supposed to be their ultimate home and put in the hollows when they are able to align with the other parts. Instead, I am told, they are being welded in the hollow. i am told that is very risky.” Museveni writes.

“Mistakes are being observed at Karuma. The 'owner's engineers' are informed but they do nothing. I, therefore, direct you to, at once, confirm if these stories are true so that you stop further and more irreversible mistakes. If, for instance, concrete is poured over such defective structures, it will create an irreversible situation of having a defective dam and power house.

If it is necessary to suspend work until the defects are corrected, it should be done. The 'owners' engineers' could either be re-enforced or even dismissed. Re-enforcing them, at the minimum, would mean giving them other actors that to co-sign the completion forms before payments are made.” The president directs in the letter copied to the Vice President.

Karuma dam, according to ministry officials will be ready by December, 2018 when the six turbines will be up and running. The ministry officials, during a field tour this month at the Karuma construction site, noted that underground tunnels to access the power house that will generate about 600MW is almost complete.

Henry Bidasala, the commissioner electricity power development at the energy ministry said 30 percent of the construction work is done. Bidasala told journalists that excavation works of the Karuma hydropower project has been completed and that the contractors Sinohydro Corporation is at the stage of pouring concrete onto the excavated dam site.

But according to President Museveni's letter, much of this work is shoddy and a risk that will lead to loss of money and human life. Two Chinese firms, Sinohydro Corporation and China International Water and Electric Corporation were contacted to construct Karuma Hydroelectric Power Station (600MW) and Isimba Hydroelectric Power Station (183.2MW) respectively.

An Indian firm, Energy Infratech Private Limited was contracted to perform the feasibility study and supervise works at Karuma while a consortium consisting of engineering firms Fichtner (lead) and Norplan are in charge of Isimba through their sub-contractors Kagga & Partners, a local firm.

The estimate cost of constructing Karuma is put at US $2.2 billion while that of Isimba is valued to be $550 million. Both projects are funded through a loan government of Uganda acquired from Export-Import Bank of China. The two dams are scheduled to be commissioned in December 2018.

Karuma Hydroelectric Power Station is located at Karuma Falls on the Victoria Nile, at the present location of the Karuma Falls, in Northern Uganda on the highway to Gulu while Isimba Hydroelectric Power Station is located at the village of Isimba on the Victoria Nile, in Kamuli District, Eastern Uganda.

The procurement for the lead construction contractors were marred by corruption scandals that led to the delay of construction works to take off. And now talk of shoddy work risks suspension of the much needed projects considering the energy deficiency in the country.

Construction Of East Africa’s Largest Solar Power Project Starts In Uganda

 

The Uganda Ministry of Energy teed off the construction works of the largest privately funded solar power plant in East Africa. The project, based in Soroti, eastern Uganda, is being bankrolled by Access Uganda Solar ltd, a partnership between EREN RE and Access Power.

 Once finished and operational, the solar plant will power 40,000 homes and businesses. 80 percent of residents in Soroti and neighboring district currently don’t have access to electricity. This project, worth $19m, comes as a major boost. It will provide clean, low carbon, sustainable electricity to national grid.

State Minister for Mineral Development Hon. Peter Lokeris expressed government’s gratitude to Access Power for the development of energy in this region. “Uganda suffers an energy deficiency and has sought to work with Corporations such as Access Power to bridge this gap,”

“Government priorities such Agro Processing can only get lifted off the ground with sufficient and reliable energy. I have confidence in the project because our country enjoys an all year round sunny climate which is the resource for Solar Power.”

It is believed that the project will spur growth of small agrobased factories, power social centers like schools, hospitals among others.

Reda El Chaar, Executive Chairman of Access Power, said breaking the ground to symbolize start of construction of the project marks a major milestone for Access Power, for Uganda and for the development of Africa.

“According to the International Energy Agency, 60% of Africa’s population are living without reliable electricity supplies whilst as a continent it has attracted $25 billion in investment in renewables in the past six years.  Our company brings innovation, expertise and determination to every project we work on and we are particularly proud of Soroti and everyone involved”.

The Soroti project is the first solar power plant to be successfully developed under the GET FiT scheme, in partnership with the Government of Uganda through the country’s Electricity Regulatory Agency (ERA). It is funded by the European Union Infrastructure Trust Fund, and supported by the governments of Germany, Norway and the United Kingdom.

Current power generation in Eastern Uganda is intermittent, especially during the summer months, with extensive load shedding of up to four hours a day. This has impeded economic development in the area and also has an impact on the quality of life.  Local labour is being hired for the construction phase and the developers will also recruit and train engineers to operate the plant. 

Christophe Fleurence, Vice-President of Business Development - Africa of EREN RE, said the extensive political and international support to this project underlines the broad willingness to shift boundaries in electricity generation.

“EREN RE which is a renewable energy investor and a long-term independent power producer is determined to switch light on in many other places in Africa and emerging markets more generally, as efficiently as it was achieved at Soroti.”

Ethiopian Cement Company Signs Up For Renewable Energy

 

The Egyptian Company for Solid Waste Recycling (ECARU), a subsidiary of Qalaa Holdings’ Tawazon, announced signing of a US$ 50 million, five-year contract with Ethiopia’s Messebo Cement to supply 100,000 tons of biomass annually. The biomass will be used as a source of energy to replace coal.

As stipulated by the agreement between the two companies, ECARU will be the technology and service provider responsible for collecting, transporting and processing local Biomass that will be converted to environmentally-friendly alternative solid fuel.

“Biomass is a renewable, carbon neutral energy source that comes from agricultural residues that would otherwise be openly burned. This waste to energy solution for heavy industries such as cement manufacturing, is beneficial on multiple fronts. It helps nations solve their Biomass challenges, it reduces emissions that come from burning fossil fuels such as fuel oil, natural gas and coal, and it is a more cost-efficient and sustainable source of energy,” said Dr.HishamSherif, CEO of ENTAG/ECARU.

“Today we are exceptionally proud to be able to transfer our knowledge and years of experience to the countries of sub-Saharan Africa where Biomass as a source of renewable energy has been largely untapped,” he adds. ECARU has been supplying alternative Solid fuel, Biomass, as a source of energy to Egypt’s leading cement companies for the past five years.

The contract with Messebo Cement, which is located in Mekelle, 780 km from Addis Ababa with a production capacity of 2 million tons of cement per annum, is renewable beyond the stipulated five-year time period under the same terms and conditions.

Tawazon, Qalaa Holdings’ subsidiary company for investment in the regional solid waste management industry, controls two companies: the Egyptian Company for Solid Waste Recycling (ECARU), a solid waste management service provider, and Engineering Tasks Group (ENTAG), a solid waste management technology provider. Together, these two companies form a leading waste management enterprise with extensive operations in Egypt and an international project book in Oman, Malaysia, Sudan, Nigeria, Libya, Saudi Arabia, Qatar and Syria.

Qalaa Holdings has invested in Tawazon as part of its energy portfolio which also includes TAQA Arabia, Egypt’s largest private sector energy distribution company and the Egyptian Refining Company (ERC), a US$ 3.7 billion refinery, Egypt’s largest in-progress, private sector mega project.

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