The government of Uganda has released 22 billion shillings towards the servicing of the Isimba hydropower plant loan. The ministry of finance is optimistic that with the generation of electricity increasing, the loan will be paid as per the agreement.
In 2018, the government of Uganda acquired a 570 million dollar loan from EXIM Bank of China to finance the construction of the 183MW Isimba hydroelectricity station, with the intention to increase power supply and boost the industrialization agenda in the country.
Following the commissioning of the dam last year, the assets of the Uganda electricity generation company limited have as well increased to a tune of 7.1 Trillion shillings in 2020 from 6.7 trillion shillings in 2019.
However, while the assets grew and commercialization started, servicing the loan was as well considered important. The annual financial report released by the Ministry of Finance indicates that repayment of the Isimba loan has already started.
The profits of the company have however dropped to 2.8 billion shillings from 24.8 billion shillings registered in the year 2019 and engineer Harrison Mutikanga warns that a further drop is expected.
Meanwhile, the total revenue of the company increased to 161 billion shillings from 66 billion shillings in 2019.
The Uganda Electricity Generation Company Limited expected growth was however hit by the effect of the coronavirus crisis that rocked the country at the start of 2020.
Isimba Hydropower Project
Project
About the Isimba Hydropower Project as per www.nsenergybusiness.com
The Isimba hydropower project is a run-of-the-river hydroelectric plant located on the Nile River, approximately 4km downstream of Simba Falls, in the Kamuli district of Uganda.
Feasibility study of the $567.7m Isimba project was completed in September 2012 and construction was started in April 2015. The project was commissioned in March 2019 and is expected to generate 1,039 gigawatt hours (GWh) of electricity a year.
The Ministry of Energy & Mineral Development, Government of Uganda (GoU) fully owns the hydropower project. Uganda Electricity Generation Company (UEGCL) was responsible for project implementation.
The Isimba hydropower project is developed in line with the Government of Uganda’s National Development Plan NDP II and Vision 2040, which are aimed at generating sufficient electricity to meet the future needs of Uganda.
Transmission of power generated from Isimba HPP
Power generated at the Isimba hydropower project is transmitted to the national grid through a 42km-long 132kV double-circuit transmission line connecting the Bujagali hydropower station.
Financing
The Government of Uganda provided funding of $85m, which accounts for 15% of the total project cost, while the Export-Import Bank of China provided a loan of $482.5m.
Contractors involved
China International Water & Electric Corporation (CWE) was awarded the engineering, procurement, and construction (EPC) contract for the Isimba hydropower project in August 2013.
The joint venture of Fichtner and Norplan drafted the feasibility study report of the project, under a $3.8m contract awarded in 2010.
Energy Infratech, a company based in India, served as the owner’s engineer for the project until September 2017. The consortium of Artelia Eau & Environment and KKATT Consult was appointed as the owner’s engineer in January 2018.
