An energy activist group has said non-renewal of the UMEME’s concession as electricity distributor will not end what it calls endemic corruption and mismanagement of the electricity sector.
While Africa Institute for Energy Governance (AFIEGO) welcomes President Museveni’s directive against renewal of UMEME’s concession, it is calling for more action including punitive measures against Energy Minister Irene Muloni and her ministry officials.
AFIEGO says Engineer Muloni should be censured by Parliament for failure to implement the recommendations of the General Salim Saleh probe into UMEME.
The Salim Saleh investigations report into the high cost of electricity in Uganda was handed to the then Energy minister Eng. Hillary Onek in early October 2009.
The report highlighted a number of irregularities in setting the power tariffs and faulted the biding process leading to the award and the signing of concession agreement with UMEME and ESKOM.
AFIEGO notes that the Saleh interim tariff review report has never been implemented by the Minister.
President Museveni in a March 12th letter directed the Ministry of Energy not to renew the UMEME concession.
He also directed the Inspectorate of Government to investigate UMEME over suspected exploitation of consumers in connivance with the Energy Ministry officials.
AFIEGO in a statement described the president’s directive as a positive step towards cleaning Uganda’s electricity sector but observes that it will not result into lowering tariffs as well as addressing the many challenges in the sector.
It says the mismanagement in the electricity sector is characterised by single-sourcing of companies to build dams among others.
President Museveni is personally blamed for having directed the Ministry of Energy to award the Karuma and Isimba dam projects to Sinohydro and China International Water and Electric Corporation, respectively, without open bidding.
AFIEGO Chief Executive Officer, Dickens Kamugisha, in an interview said the country would have negotiated better deals had it opened the construction of the two dams to open bids.
The Saleh report on tariff review had faulted the procurement process for UMEME and Eskom. It observed that in both cases of Eskom and Umeme, there is no evidence that the procurement process went through any competitive process.
Kamugisha says the lack of competitive bidding or single-sourcing means that selection of companies with the best terms including a lower return on investment is ignored.
“It also encourages corruption as government officials collude with the investors to guarantee the investor high returns on investment in exchange for bribes. This results in high end-user tariffs that citizens shoulder,” reads part of the statement
AFIEGO says there is poor leadership at the Ministry of Energy, blaming the ministry for failure to implement parliamentary and government committee recommendations like the 2009 Interim Review of Electricity Tariff Committee headed by Gen. Salim Saleh and the 2014 adhoc parliamentary committee that investigated electricity failures and called for termination of UMEME’s contract.
AFIEGO further blames the Electricity Regulatory Authority (ERA) over failure to stop what it calls UMEME’s exploitation of consumers.
“ERA, which should be protecting Ugandans from UMEME’s exploitation, has occasionally come out to defend UMEME. For instance, when UNBS confirmed in January 2018 that over 92% of the electricity metres including UMEME’s metres that it tested between June and December 2017 were faulty, ERA, through an article published in the newspapers, defended UMEME saying that its metres were not faulty.”
In a related development, AFIEGO calls on government to stop payments to Jacobsen and Electro Maxx for expensive thermal power that Ugandans do not consume.
“The fact that these companies continue to be paid from taxpayers’ money when Uganda is generating more power – over 900mw- than citizens can consume is gross mismanagement of the highest order,” said the statement.
AFIEGO among other recommendations is calling for the amendment of the 1999 Electricity Act to among other changes guarantee the independence of Electricity Generation Authority.
Minister Muloni is yet to comment on the matter. Efforts to seek a comment from her about the allegations were futile because her known mobile number was switched off.