The Ugandan unit of South Africa’s Eskom, which manages plants generating almost half of the east African nation’s electricity, said it wanted to more than double the capacity it ran in the country.
Eskom Uganda was interested in operating the 600 megawatt Karuma hydroelectric dam that was being built by Beijing-based Sinohydro and a 183MW project developed by China International Water and Electric, Simon Kasyate, a spokesman for Eskom Uganda, said. The government says its two plants may start generation in 2018.
The company’s experience in Uganda “plays well in positioning Eskom Uganda as a natural choice for such projects like the management and operation of huge hydropower plants,” said Kasyate. The company could not divulge strategic business information on when talks would start, he said.
Uganda, which has east Africa’s third-biggest economy, has installed capacity of 810MW and peak demand of 509.4MW, according to the electricity regulator.
The 250MW Bujagali hydropower plant on the Nile River, in which Blackstone Group’s New York-based Sithe Global Power has a stake, is the nation’s biggest producer of energy. Industrial consumers include the local units of Coca Cola, Lafarge Cement and China Machine Building International, according to Kampala-based Umeme, the distributor.
Eskom has had a 20-year contract since April 2003 to operate and maintain the 180MW Nalubaale and 200MW Kiira hydropower plants on the Nile, 80km east of Kampala, the capital.
Uganda’s parliament last month backed a recommendation that Eskom’s concessions to run the plants be terminated on allegations that the contracts were biased in favour of the company, the state-run New Vision newspaper reported on March 28, citing parliamentary proceedings. Eskom was confident it would run out its existing contracts, Kasyate said.
Umeme is controlled by CDC Group, a UK government-owned fund, through Actis’s Actis Infrastructure 2LP, according to the distributor’s annual report last year.
Eskom produces more than 95 percent of power in South Africa, which has the continent’s biggest installed capacity of 42 500MW.
One megawatt was enough capacity to power about 200 middle-income South African homes at peak times, Andrew Etzinger, the spokesman for the utility, said at the beginning of last month.
Uganda’s power regulator had reduced electricity tariffs for April to June by 1.1 percent for large customers, it said last week.
The move follows a cut in January, which was the first since June 2010. – Bloomberg