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Energy News Network Industry news News Uganda electricity distribution rebuilds its network a year after Umeme’s concession ended
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Uganda electricity distribution rebuilds its network a year after Umeme’s concession ended

2nd September, 2026

Umeme handed 2.3 million customers to the state in March 2025, closing the first private distribution concession in anglophone Africa. Uganda’s regulator has held tariffs flat and approved substation investment across six districts. The compensation figure that sets the utility’s asset base remains contested.

A new 10 to 14 MVA transformer has gone into Kampala South Substation, expected to serve more than 108,000 households and over 650 commercial customers along Entebbe Road. Kakiri, Kabale, Masaka, Kumi and Mubende have had the same treatment.

The work follows the end of a twenty-year concession. Umeme handed Uganda’s electricity distribution network to the state on 31 March 2025, having been the first private distributor in anglophone Africa and serving 2.3 million customers at handover. Uganda decided in 2022 against renewal, citing high tariffs and low access rates.

The Electricity Regulatory Authority has approved that targeted investment and intensified oversight through the transition, with chief executive Eng. Ziria Tibalwa Waako directing corrective measures after prolonged outages, voltage fluctuations and delayed restoration. The Ministry of Energy and Mineral Development attributes the difficulty to inherited equipment and a demand spike arriving together.

Tariffs have been held rather than raised. The regulator kept end-user rates unchanged into the first quarter of 2026 and created an Extra-Large Service customer category from January, sitting inside a framework that ties industrial tariff reduction to demand growth.

Umeme claimed $235 million in compensation for investment made and not recouped. A special audit by the Office of the Auditor General reduced the claim by close to 40 per cent after finding inconsistencies, against a parliamentary approval to borrow up to $190 million for the buyout. Whatever is finally paid becomes Uganda Electricity Distribution Company’s opening asset base, and the regulator sets tariffs against it.

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