9 October 2008
editorial
Kampala — THE 200 MW dam planned for Karuma has failed to take off because of unending negotiations between the Government and Norwegian project promoter, Norpak.
Negotiations started in September last year and were supposed to be complete in December. Construction was supposed to kick off in January.
Twelve months down the road, we have not broken ground yet. It is not clear what exactly is holding up the negotiations but there are suggestions that Norpak is being intransigent in some of its demands.
The delay of the Bujagali dam was partly due to the insistence by donors that both dams could not be built simultaneously. Supporters of the Karuma project at the time insisted that they were ready to go once they got the government go ahead.
The issue of power generation is critical for Uganda. Currently our peak time national demand is 125MW above our generation capacity.
As if that is not enough, demand is growing at an estimated 42MW a year. This means that when Bujagali's 250MW comes on line in 2011, we will still have an electricity shortfall.
Estimates also show that our power generation capacity will have to double five times in the next 20 years if we are to satisfy the expected 11,000 MW demanded then.
Time is of the essence. For every megawatt of power shortfall there is a corresponding loss in economic growth, and without economic growth all talk of poverty eradication will remain just talk.
Government has committed sh200b to an energy fund whose main function is to fast track power generation projects.
Last year it was used to good effect in kick starting the Bujagali dam project.
While sh200b is not much when talking about dams, it at least gives us some leverage.
Considering the urgency of our situation, the Government should seek only the best partners to develop our power sector. The Government should not be held to ransom.
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