Uganda opens US$19mn solar plant, signs deal for hydropower project
East African country Uganda has launched the region’s largest solar plant, worth US$19 million, for the residents of the eastern Uganda town of Soroti may be set to enjoy more stable and affordable power supply.
The plant, which is Uganda’s first grid-connected solar plant, will generate 10MW of power, with the potential to double the capacity.
It is anticipated that the plant will extend sustainable electricity to 40,000 homes, businesses, and schools in the country.
State Minister for Energy Simon Dujang said the project is expected to reduce environmental degradation in the area.
In his speech, the head of the European Union delegation to Uganda, Kristian Schmidt said the East African nation has a conducive environment to invest in solar energy as the regulatory framework is conducive and government rightly recognizes the fact that the country’s energy future must be renewable.
The project was developed under the Global Energy Transfer Feed in Tariff (“GET FiT”), a support scheme for renewable energy projects managed by Germany’s KfW Development Bank in partnership with the Electricity Regulatory Agency (ERA).
The Ugandan government has also signed an agreement with various funding partners for the planned construction of the Muzizi Hydroelectric Power Station.
The project’s funding partners are KfW and French Development Agency (AFD). KfW will provide a concessional loan of US$42.4million (EUR40 million) and a grant of US$5.3million (EUR5 million) while AFD will contribute a concessional loan of US$ 47.7million (EUR45 million).
The Ugandan government will contribute an equity contribution of about US$21.2million (EUR20 million) to ensure full financing of the project, whose total cost is estimated at US$116.5million (EUR110 million).
The Muzizi project is located along River Muzizi about 6km upstream of Lake Albert on the south-eastern side in the District of Kibaale. The project foot print, however, extend to Kabarole, Kyenjojo and Ntoroko districts in the western region.
The Project, with a capacity of 45 MW, is expected to increase the current power generation capacity in Uganda by about 5% upon completion, benefiting about one million people.
Finance Minister Matia Kasaija, who signed the agreements on behalf of government, said that Muzizi project will help Uganda in achieving aspirations of the National Development Plan – NDP II of attaining 2,500 MW of installed electricity generation capacity by 2020.
France’s Ambassador to Uganda Stephanie Rivoal, said their support is to meet energy needs of Ugandans through hydro power and discourage bad practices like deforestation which have effects on climate change.