Uganda’s Electricity Regulatory Authority (ERA) has announced revised electricity tariffs for the Uganda Electricity Distribution Company Limited (UEDCL) following the successful handover of operations from Umeme Limited.
Announcing the new measures to reporters at the handover ceremony in Kampala, the Electricity Regulatory Authority (ERA) board chairperson, Dr. Sarah Wasagali Kanaabi, said the new rates will come into effect from April to June 2025, and will include adjustments for domestic, commercial, and industrial consumers.
Dr. Kanaabi said these tariffs are updated quarterly following a comprehensive review process that includes the application and public feedback received during the publication period.
ERA Chairperson Dr. Sarah Kanaabi said several factors were considered before imposing the tariffs, including demand, which they expect to grow at an annual rate of 10.4 percent in 2025.
It is also assumed that the quarterly tariff adjustment methodology, which the ERA has implemented since 2014, will continue in 2025.
This methodology adjusts the annual base tariff based on changes in inflation, exchange rates, international fuel prices, and other approved costs.
Also, the UEDCL tariff performance targets for 2025, following the license for sale and distribution of electricity issued to them, will continue to hold.
“The next assumption is that ERA will continue the implementation of measures to reduce the electricity end-user tariffs for manufacturers pegged on pre-determined demand growth targets for the year 2025,” she said.
Kanaabi said the ERA will continue to review the implementation of the public amenities customer category such as street lighting, hospitals, and cooking for institutions.
“We shall continue to review the composition of the medium and large industrial customer categories to provide separate customer categories for electricity consumers involved in manufacturing compared to those who are providing services,” she said.
Dr Kanaabi further explained that the ERA will continue the implementation of the declining block tariff structure for large industrial manufacturing customers for the tariff year 2025.
“There will also be cessation of the block tariff structure for the extra-large industrial manufacturing category effective midnight on Monday.”
Impact of Umeme’s exit
Meanwhile, Uganda’s parliament recently approved a $190 million loan for the buyout of Umeme Limited. The buyout move was necessary to purchase assets from Umeme Limited and for Uganda to pay Umeme back for any capital investments that remain unrecouped at the conclusion of the contract.
ERA Communications Director Julius Wandera noted that Umeme’s departure is expected to gradually reduce tariffs, with initial benefits favoring large manufacturers.
“Our goal was to bring manufacturers’ tariffs down to 0.5 US cents per unit, which has now been achieved under UEDCL,” Wandera said.
The next tariff review will consider further refinements for public institutions and industrial categories. Connection charges remain unchanged.
Key changes in tariffs
The major shift in tariff includes:
– Lifeline tariff (0-15 units): 250 Shillings per unit (for domestic users consuming up to 100 units monthly).
– Domestic tariff (beyond 15 units): 756.2 Shillings per unit.
– Commercial tariff: 546.4 Shillings per unit.
– Medium industrial tariff: 355.1 Shillings per unit.
– Manufacturing tariff: 412.5 Shillings per unit.
– Large industrial tariffs:
– Block One: 300.4 Shillings per unit
– Block Two (declining block): 282.9 Shillings per unit
– Extra-large industrial tariff: 203.6 Shillings per unit.
– Public amenities (hospitals, universities, etc.): 360 Shillings per unit.
