A portion of Africa’s longest water passage, the Nile River in Uganda, is set to host a $1.4bn power generation dam courtesy of a Chinese firm.<\/p>\n
The project is estimated to cover power generation at 40% as part of the expansion for the East African nation.<\/p>\n
An application has since been submitted to the energy regulatory board of Uganda.<\/p>\n
The firm, POWERCHINA International Group Limited (PIGL), wants to develop the Ayago Hydroelectric Power Station, located on a section of the Nile between lakes Kyoga and Albert, according to its licence application.<\/p>\n
“We have called for comments from the public on their proposed project,” Julius Wandera, spokesman for the state-run power regulator, Electricity Regulatory Authority (ERA) told Reuters on Tuesday.<\/p>\n
The ERA licences all power generators in the country and is also responsible for setting generation and end-user power tariffs.<\/p>\n
The Ayago power plant will have a capacity of 840 megawatts (MW) and, when successfully developed, would be Uganda’s largest power plant.<\/p>\n
The Karuma hydroelectric dam, upstream of Ayago and due to be completed early this year by China’s Synohydro Corporation, is currently Uganda’s largest power project.<\/p>\n
The ERA would also conduct its own due diligence on POWERCHINA International to ascertain whether it had the financial and technical capacity to execute the project, Wandera said.<\/p>\n
“By April we should be communicating our final decision on their application to them,” he said.<\/p>\n
According to their application, the firm plans to raise funds for the project through a 25-75 percent mix of equity and debt.<\/p>\n
Start Here: What’s behind the Egypt-Ethiopia Nile dispute? (6:48)
\nThe project could potentially ramp up Uganda’s generation capacity by 40 percent to about 2,800MW according to calculations from data available from the energy ministry.<\/p>\n
In recent years, Uganda has been wooing private-sector energy investors and taking loans from China and other sources to help boost power production to meet fast-growing demand.<\/p>\n
To make the sector attractive to foreign investors, the government abolished subsidies for consumers and introduced a tariff-setting system that is benchmarked on movements in key parameters such as inflation, foreign exchange and oil prices.<\/p>\n
Uganda is one of six countries that signed a 2010 Cooperative Framework Agreement (CFA) that allows upstream Nile basin countries to develop projects along the river without Egypt’s consent as it was in a previous colonial-era agreement on the use of Nile waters.<\/p>\n
Building dams on the Nile has proven controversial in recent years with Egypt, which almost entirely depends on the water from the river, seeing them as a national security threat.<\/p>\n
Ethiopia is currently building a dam on its section of the Nile. The Grand Ethiopian Renaissance Dam is about 70 percent complete and promises to provide much-needed electricity to Ethiopia’s 100 million people.<\/p>\n
However, Egyptian officials are concerned that filling the reservoir behind the dam could significantly reduce the amount of Nile water available to Egypt.<\/p>\n
The two countries are negotiating a way forward and are expected to strike a deal in the coming weeks.<\/p>\n","protected":false},"excerpt":{"rendered":"
A portion of Africa’s longest water passage, the Nile River in Uganda, is set to host a $1.4bn power generation dam courtesy of a Chinese firm. The project is estimated to cover power generation at 40% as part of the expansion for the East African nation. An application has since been submitted to the energy […]<\/p>\n","protected":false},"author":8,"featured_media":361,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false}}},"categories":[20,25,28],"tags":[],"jetpack_publicize_connections":[],"yoast_head":"\n