At least Shs3.9b (EUR 900,000) has been set aside to support solar and cookstove companies build resilience for future challenges.
The money mobilised by GIZ Energizing Development (EnDev) in partnership with Private Sector Foundation Uganda (PSFU) under the Covid-19 Economic Relief Fund seeks to also uplift off-grid energy companies from the current Covid-19 related challenges as well help in sustaining growth in the off-grid energy sector.
Speaking during a webinar, Mr Anja Rohde, the EnDev Uganda project manager, said the negative impact of Covid-19 had "forced companies in the sector to take drastic measures with majority of businesses indicating they were not able to cover for financial losses over a long period of time".
"Even mid-sized and large companies in the sector expressed several financial vulnerabilities," she said, noting the Fund will seek to help firms to continue providing access to energy but also build resilience to future challenges.
EnDev is a global project, working in over 20 countries with a focus on sub Saharan Africa.
The project is financed by five countries including Netherlands, Germany, Norway, UK and Switzerland with the need to promote sustainable access to modern and affordable energy.
Mr Simon Kalanzi, the Energy Ministry acting commissioner energy efficiency and conservation, said a number of solar and biomass companies had had halted production and suspended after-sales services, which has a significant impact on the sector and products quality.
The Fund, he said, was a timely factor that solar and cookstove companies must take advantage of to rebuild their operations.
At least more than 50 per cent of Ugandans have no access to power with close to 80 per cent of the population which lives in rural areas depending on biomass fuel.
Mr Kalanzi said government will collaborate with donors and the private sector to ensure that off grid systems and clean cooking solutions are accessible to households.
The Fund which can be accessed through the PSFU Covid-19 relief window, gives companies and institutions involved in solar and cookstove energy an opportunity to access between Shs65.6m and Shs437m.
The Covid-19 relief window seeks to mitigate the loss of energy access among households as well as provide an opportunity through which energy companies can connect customers at a cost covered under the Fund.
Other channels through which the money shall be accessed include the boost resilience and training upgrade windows, which will allow companies to invest in infrastructure, upgrades to support mid-to-long-term resilience, and training to upgrade skilling, respectively.
According to Brenda Bitete, the PSFU fund manager, the Fund will be limited to companies or involved in solar, biomass cookstove companies or association and training entities.
Beneficiaries, she says, must be registered in Uganda for at least a year with demonstrated financial capacity engaged in the manufacturing and distribution of solar products or a Ugandan Solar Energy Association member.