Umeme workers install underground cables in Kampala. The firm had been tasked with improving and expanding the country’s power distribution network. Photo/Morgan Mbabazi
As legislators began debate on a parliamentary probe committee report, which recommends termination of power distributor Umeme and generation asset manager Eskom’s concessions, the country faces costly options.
Terminating Umeme's concession would see the government pay $148 million in severance costs at the very minimum.
While the report recommends termination of the concession, one catch is the buyout clauses that make it expensive for the government to terminate the contracts regardless of how the concessionaire is performing.