PARLIAMENT’S FAILURE TO APPROVE ENERGY SUBSIDIES HAS SWIFT AND HARSH CONSEQUENCES
The failure last week by parliament to approve the emergency request to release funds for the government’s subsidies programme to support independent electricity producers – a contractually agreed commitment by the way – has had sharp and harsh consequences for the country, as two thermal power plants were shut down by the operators, waiting until they have been paid before resuming electricity production.
This left the country with a daytime shortfall of at least 50 MW but more critically a peak demand period shortfall of at least 120 MW, prompting the power distribution company UMEME to institute an immediate rationing schedule which is now blacking out parts of the country again.
Business operators, already suffering from creeping devaluation of the Uganda Shilling and inflation rates of over 15 percent, have immediately demanded that government pays up their arrears to power producers, which now reportedly stand at over 300 billion Uganda Shillings while members of the public too have cried out for a swift resolution of the stand off.
While it is not clear if power producers are legally obliged to generate electricity under the terms of their licenses regardless of the circumstances, it is clear that once they run out of money to fund operations, especially when due to government not paying subsidies towards the hugely risen diesel and heavy fuel oil charges, they simply cannot go on to run their plants without putting fuel into them.
The new Bujagali hydro electric plant, a partnership led by IPS of Kenya, a company under the umbrella of the Aga Khan Fund for Economic Development, is due to come on line with a first output of 50 MW of relatively cheaper hydro power by October this year, due to rise to the full 250 MW by sometime in late 2012 while plans are being accelerated to begin construction of the Karuma Falls power plant which according to design changes could produce up to 750 MW, then putting Uganda in the position to have spare capacity at hand and vigorously roll out the planned rural electrification programme while assuring manufacturers and other businesses that load shedding is finally a thing of the past.
Meanwhile though have regular sources demanded that UMEME rations power to parliament until such time that the house attends to the crisis and approves the funds due for payment without further ado to rescue the country from once again sitting in darkness. Said one regular and acidly critical source on condition of anonymity: ‘these MP’s are mad, what business do they have to stop government paying out the subsidies. Let them sit in the dark too and deliberate by candle light as many of my fellow Ugandans now do. It is irresponsible of the highest order to mess up the country like this. The other day they were given training and seminars about responsible leadership and so on, but have they understood the word ‘responsible’ at all. For once we cannot blame UMEME but this time it is our own representatives in parliament. How are businesses able to run generators now with the price of diesel and petrol and all the other problems our economy already has. This is a parliament problem and shame on them’.
Harsh words but entirely true – high time our august house wakes up to reality unless they want the people to ‘walk to parliament’ in support of government.