Lawmakers on Parliament’s Ad hoc Committee investigating the allegations of corruption in the power sector, yesterday cited collusion in the award of a multi-billion power generation deal to a South African company.

Officials in the Ministry of Finance apparently brought in Eskom Uganda Ltd in a controversial power deal which hijacked the statutory mandate of Uganda Electricity Generation Company Ltd (UEGCL). The lawmakers heard that the company is currently redundant yet managers continue to pocket billions.

“Eskom is doing what exactly UEGCL would have done, this is an added burden to the taxpayer,” Mr Jacob Oboth, the committee chairman, said.

“We don’t know why government brought in Eskom yet there was UEGCL which is now doing nothing yet they continue to blow money in administrative costs.”

UEGCL Managing Director John Mugyenzi told the committee that the Privatisation Unit (PU) brought Eskom in power generation yet UEGCL had the capacity to manage, a move that has led to an increase in power tariffs.

“UEGCL was privatised because the majority took a decision and there was nothing some of us could do. It was a consensus majority decision. But I have confidence that UEGCL would have performed better than Eskom if they had given us chance to do this work,” Eng. Mugyenzi said.

Eskom Uganda Ltd was incorporated on November 2, 2002, and was awarded a concession to operate and maintain Nalubaale and Kiira hydro-power stations in Jinja for 20 years. Eskom took over operations and maintenance of the complex from UEGCL on April 1, 2003.

Lawmakers, led by Kyankwanzi Woman MP Ann Nankabirwa and Busiro East MP Medard Ssegona, demanded that UEGCL be changed to Uganda Electricity Monitoring Company since they are no longer involved in generation of power.

The MPs said there was conflict of interest in the deal after it emerged that Mr Paul Mulley, who was the managing director of the defunct Uganda Electricity Board, later presented himself as the managing director of Eskom.

But Mr Mugyenzi told the committee that he was not privy to how Mr Mulley moved from UEB to Eskom, adding that the PU should explain because they handle the privatisation process.

PU Spokesperson Jim Mugunga, however, said the government decided that generation and distribution be opened up to the private sector and that only transmission would be retained as a monopoly due to its strategic role.

“Eskom is an investor and UEGCL is managing our assets. We brought in Eskom because government lacked further resources to pump into that segment of the sector,” Mr Mugunga said.

Eskom is the main hydro power generating company and has been operating in Uganda for more than seven years.

All the electricity generated is sold to Uganda Electricity Transmission Company Limited, the authorised single buyer, which sells it to the sole distributor Umeme.

What he said

Committee chairman Jacob Oboth. We don’t know why government brought in Eskom yet there was UEGCL which is now doing nothing yet they continue to blow money in administrative costs.

By Yasiin Mugerwa, Daily Monitor



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