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This process was not unique to Uganda shedding across the country. Computing the cost
alone, globally many countries driven by the then of Aggreko generators, one knew that that was the
selling slogan of “Governments have no business wrong way to meet our power needs. There was
being in business” often times propagated by the renewed and increased appetite to get the more
Red Brick Institutions embraced to varied levels long-term private sector on board in Uganda.
the process of restructuring and/or privatization
of several of their public utilities, among other Some of our neighbors also took a similar route
entities. Uganda at the time in the good books of varying only in extent. Tanzania took to privatized
several of these institutions and just coming out management contract but abandoned this when
turmoil of war, with limited resources for most its it did not generate the desired impact – they have
infrastructure rehabilitation saw privatization as a since stayed with the vertically integrated TANES-
viable solution. CO. Kenya on the other hand created Kenya Elec-
tricity Generation Company for generation from
A Public Enterprises Restructuring and Di- Kenya Electricity Generating Company Limited
vestiture law (the PERD Statute) was enacted and (which retained distribution) and eventually set up
the process started under the supervision of the Kenya Transmission Company for bulk transmission
PERD Committee comprising mainly of the rele- and system operation. Kenya while keeping major-
vant Ministers and Permanent Secretaries with a ity shareholding with government allowed private
Secretariat dubbed the Privatization Unit, directly sector and individuals to have ownership in these
supervised by the Ministry of Finance, Planning entities mainly through the Nairobi Stock Exchange.
and Economic Development.
By all measure Uganda took the deeper extent
For Uganda, a more compelling reason was in getting private sector involved as generation,
the national need to have power for the econo- transmission and distribution became separate
my which showed strong tendencies for elec- business entities.
tricity driven economic recovery when govern-
ment completed the rehabilitation of Nalubaale Outcomes of Unbundling UEB for
Power Station astride the Owen Falls Dam in the Uganda:
mid-nineteen nineties. Rehabilitating it from a
mere 60MW nominal capacity and enhancing The unbundling of UEB, a then inefficient par-
it beyond its 1954 designed capacity of 150MW
to 180MW and completion of the new extension astatal heavily dependent on subsidies from the
national treasury, was done under provisions of
(Kiira Power Station – using the shared excess wa- the Electricity Act 1999 enacted through the na-
ters coming from the Owen Falls Dam) bringing tional Parliament. The unbundling sought to stem
on board 200MW. This looked like a drop in the the need for treasury subsidies to UEB, create more
ocean compared to the anticipated need. The
needed resources to cover the gap were not small. focused and efficient business units and attract pri-
vate sector to invest in the generation and distri-
Hence attracting private sector to bring some of bution segments of the sector to free government
the capital investment required was quite attrac- funds for other national needs. These two do not
tive. Private sector itself were attuned to the large have monopolistic attributes as transmission and
investment opportunities presented.
system operator, which remain in a corporatized
government entity.
To remove any doubt on the need for private
sector participation, a drought set in around the
same time that privatization was taking place. Entities Created by Unbundling UEB
Water levels prevented both Nalubaale and Kiira
Power Stations from generating optimally. By The process yielded six entities each with
2003/4 Uganda was relying on very expensive unique mandates, a distinct Board of Directors and
emergency power supplied by the Aggreko Com- Managing Director or Chef Executive Officer:
pany generators to address 4 days a week load
