President Yoweri Museveni has directed elimination of Uganda’s leading power distributors Umeme from supplying electricity to the country’s industrial hubs.
The President said going forward, power going to the various industrial parks will bypass Umeme as a way of cutting costs.
“I need you to listen to this and take notes; for industrial parks, the power will go straight from generation to the industrial parks, not through Umeme,” Museveni ordered.
“If Umeme collapses, my mother died and I buried her,” he added.
The President was this Saturday afternoon speaking at the national commemoration of the International Labor Day at State House in Entebbe.
Speaking at the event, Museveni blamed the high costs of production in the country to among others, expensive power.
The high costs of power, the president said were attributable to the government officials who “went behind my back” to sign a very expensive deal for construction of Bujagali hydropower plant, as well as the 2005 concession that allowed Umeme – a private company – to take over power distribution from Uganda Electricity Distribution Company Ltd (UEDCL).
Regarding the Bujagali power plant, Museveni revealed that he had initially been approached by an American firm named AES who wanted to build a power plant in the country, and that he agreed to the plan.
“I accepted this, provided that we agree on the final price which was 4.9 US cent,” he said.
However, to his shock Museveni says Ministry of Energy officials went behind his back and signed an expensive deal for construction of Bujagali, whose power cost went as high as 13 us cents compared to 1.4 US cents from Nalubaale power plant.”
On the other hand, Museveni said the high electricity prices in the country were compounded by the introduction of a private “middleman” power distributor, that is focused on enriching its shareholders.
It should be noted however; that the majority of the Umeme shares are owned by Ugandans through National Social Security Fund (NSSF).
Umeme is currently in discussions with government for extension of its 20 year concession which expires in 2005.
President Museveni has in the past threatened rejecting the new concession over high costs of power.
Umeme officials however, have held private meetings with the president to convince him.
By publication of this this story, ChimpReports was yet to established whether Museveni had directly made his decision on industrial electricity bypassing Umeme, known to the company officials.
Umeme Spokesman Peter Kaujju was not available for comment.