Donors locked out of Karuma power project

Chinese equipment worry

The donors also caution that the four Chinese contractors bidding for the construction contract may not be up to the job.

While acknowledging that there are many experienced and qualified Chinese contractors who have successfully delivered projects in Africa, they say there are exceptions: Electrical and electro-mechanical equipment from China tends to be of lower quality than equipment manufactured in Europe or the United States.

“The electrical and electro-mechanical equipment has a big impact on the efficiency, durability and operation and maintenance costs of hydropower plants,” said Dr Witte.

However, Mr Bukenya said this was not an issue. “We are not even sure that the Chinese will win the bid, but if they do I am sure they will do their best to demonstrate their competencies.

There is a cut-throat competition between the East and West with campaigns to capture resources,” he said. 

The government of Uganda continues subsidising electricity to make it affordable to the end users.  Since 2005, the subsidies provided have cost the government $200 million a year.

The National Planning Authority recommends that Uganda increase its power generation capacity to 3,500 MW by 2015 to meet growing. However, key projects are still far down the pipeline with Karuma expected to have a procurement to delivery cycle as long as 10 years, according to independent estimates.

Uganda has an installed capacity of 630MW but almost half of it is off the national grid due to various factors including; non-payment of power generators, and the reduced water level of Lake Victoria.