Facing an acute energy shortage that left only five percent of the country with regular access to electricity, Uganda in 1999 worked with the World Bank Group and other development partners to develop a new energy sector strategy.
A key element of the reform program is the concession of power distribution facilities to the private sector as a means to underpin the commercial viability and sustainability of the power sector..
The Bujagali Hydropower Project also forms a crucial part of the new energy strategy. The project consists of constructing a 250 megawatt, run-of-the-river hydropower plant on the Victoria Nile that will re-use water flowing from two existing upstream facilities to generate electricity.
The additional electricity will increase the supply to the national power grid at the lowest cost compared to other power generation expansion options under Uganda’s energy sector strategy.
The result of the public-private approach to implement Uganda’s new energy strategy was the announcement in April of $360 million in support to the Bujagali Hydropower Project from the World Bank Group. The support consists of $130 million in loans from IFC to Bujagali Energy Ltd., the private project company, a partial risk guarantee of $115 from the International Development Association for the benefit of the project’s commercial lenders, and an investment guarantee $115 million from the Multilateral Investment Guarantee Agency, the World Bank Group’s political risk mitigator.
For more information contact:
Houtan Bassiri
Communications Officer
Johannesburg, South Africa
Tel: +27-11-731-3179
Email: hbassiri@ifc.org
