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Extending the rural electrification grid in order to boost economic dynamism in the West regions / AFD
The lack of energy infrastructure holds back Uganda’s economic growth. AFD is providing its support to a project to extend and reinforce the rural electrification grid in the West of the country.
Context

Uganda's electricity access rate stood at 14% in 2013. With an average of 75 kWh/year, per capita consumption is one of the lowest in Africa. For comparison, this consumption was the same year for a Frenchman at 7344 kWh/year, or nearly 100 times more.
These weak indicators reflect the need for sector development in Uganda. 400,000 connections per year would indeed be necessary to absorb the growth rate of an ever increasing population.

The government has become aware of the need to develop energy infrastructure. It approved in July 2013 a 2nd Rural Electrification Strategic Plan (RESP 2).
The objective is to increase energy access from 7% in rural areas in 2013 to 26% by 2020: this would represent a total of 1.28 million additional users connected to the network. This plan will be implemented by the Rural Electrification Agency (REA) at an estimated cost of over $950 million. It is also supported by the World Bank through its Energy Programme for the Transformation of Rural Areas, the third phase of which covers the period 2013-2019.

Description

The €55.5 million project will finance the extension and reinforcement of the electricity distribution network in the North West and South West regions of Uganda. It complements the World Bank's action and comprises four components:

the extension of the medium and low voltage network, with the connection of 70,000 households;
the supervision and control of works by an international expert;
the connection and metering of new users with the appropriate equipment;
the support of private distributors to establish viable and sustainable pricing, and the REA in its institutional strengthening.

AFD is supporting the project through a 42.9 million euro loan granted to the Ugandan government. A further €8.3 million is being provided by the European Commission. The remaining €4.3 million is provided by the Government of Uganda.

Impacts

This financing will make it possible to: Strengthen the medium and low voltage network in rural areas Improve access to energy for populations, administrative centres, businesses, factories and local social services in rural areas Boost economic development in the areas concerned Reduce inequalities between rural and urban areas.

17/11/2015
Project start date
Sectors
Province occidentale
Location
42 900 000
EUR
Financing amount
Government of Uganda
Beneficiaries
Co-financiers