Considering we are now in 2018, Uganda still falls considerably short when it comes to electricity access rates because it has one of the lowest rates throughout the whole of Africa. This proves that more has to be done to make electricity more affordable, accessible and more prominent to private investors. The statistics speak volumes when you consider just how inaccessible electricity really is for the country. Only 14% of Ugandans have access to electricity, with 40% of urban households being connected with only 5% of rural households having access to electricity.
In comparison to the rest of the world Uganda has one of, if not, the lowest rate of electricity consumption and this is considered to be blamed on the fact that electricity is expensive. In fact, the country has one of the highest electricity tariffs seen throughout the whole world. Production is affected by high tariffs, particularly those high tariffs that relate to commercial and industrial tariffs. Therefore, this highlights that cheaper electricity is required for commercial and industrial businesses in order to enhance production and increase employment levels. Uganda is a country that relies heavily on its agricultural processing industry and this is one area that could benefit from alternative energy and cheaper tariffs.
Uganda is a country that has a number of options when it comes to renewable energy resources, in particular, solar power. However, public funds are significantly low and so, there insufficient funds available to invest in this area. This means that the government is unable to do it alone and this means that there is a requirement for private capital to be injected but there are challenges that the private sector has to overcome in order to invest in the power sector within Uganda.
Despite this, strides are being made in the right direction as the government has introduced incentives that are helping the solar PV market to grow, including tax breaks and consumer subsidies that are designed to encourage further investment from the private sector. Currently, one of the largest projects being undertaken in Uganda is the 10MW solar plant, which will be the largest in East Africa, proving that the commitment is there.
