The Electricity Regulatory Authority (ERA) has unveiled the new electricity tariffs for the first quarter of 2025, marking a 5.2% reduction compared to the rates of the previous quarter.
The adjustments, approved during the Authority’s 419th meeting on December 18, 2024, reflect significant developments in Uganda’s energy sector, including the conclusion of Umeme Limited’s concession and the commissioning of the Karuma Hydro Power Plant.
Dr. Sarah Kanaabi Wasagali, Chairperson of ERA, announced that the revised tariffs align with key assumptions, including a projected annual electricity demand growth of 10.4%.
Energy purchased by the Uganda Electricity Transmission Company Limited (UETCL) is expected to rise from 6,634.54 GWh in 2024 to 7,327.14 GWh in 2025. The recently completed Karuma Hydro Power Plant will also contribute significantly to the country’s energy mix, alongside the West Nile region’s connection to the national grid in August 2024.
Under the new tariff structure, domestic consumers on the lifeline tariff will pay Ush 250 per unit, while other domestic users will be charged Ush 775.7 per unit. Commercial consumers will pay Ush 575.2 per unit, and tariffs for medium and large industrial users have been recategorized to distinguish manufacturing from service-based consumption.
Manufacturing entities in the medium industrial category will pay Ush 417.8 per unit, while service providers will pay Ush 434.5. Large manufacturing industries will pay Ush 351.5 per unit, with service-based large industries paying Ush 367.1. Extra-large industrial consumers will benefit from a tariff of Ush 299.1 per unit, and public amenities, including street lighting and hospitals, will pay Ush 360 per unit.
The creation of the public amenities tariff reflects ERA’s commitment to improving social services. This new category ensures affordable electricity for essential public infrastructure, such as hospitals and streetlights, in line with the Authority’s Environmental, Social, and Governance (ESG) priorities.
Significant changes are also anticipated in the distribution sector as Umeme Limited’s licenses and concession agreement expire on March 31, 2025.
The Uganda Electricity Distribution Company Limited (UEDCL) will take over electricity distribution from April 1, 2025. This transition will require tariff rebasing to accommodate UEDCL’s operational parameters, which differ from those of Umeme. The new framework is expected to address UEDCL’s larger service territory, increased customer base, and unique investment needs.
In addition to the tariff adjustments, ERA has reaffirmed its commitment to transparency in the tariff review process.
Following the receipt of applications from Uganda Electricity Generation Company Limited (UEGCL), UETCL, and Umeme Limited, the Authority published a public notice inviting feedback on November 8, 2024. A public hearing held on December 12, 2024, at Margarita Palace Hotel in Lira City attracted 893 participants, both physically and virtually, including political leaders, manufacturers, and members of the Uganda National Chamber of Commerce.
Dr. Kanaabi emphasized the importance of ensuring that electricity remains accessible and affordable, particularly for domestic users and the manufacturing sector, which is a critical driver of Uganda’s socio-economic transformation. She further noted that declining block tariffs for large and extra-large industrial consumers will continue, as will the domestic cooking tariff of Ush 412 per unit for monthly consumption between 81 kWh and 150 kWh.
Looking ahead, ERA projects continued quarterly tariff reviews based on inflation, exchange rate fluctuations, and international fuel prices. Additionally, the Authority remains committed to exploring initiatives that promote energy efficiency and sustainability, ensuring that Uganda’s energy sector remains a catalyst for economic growth and development.
Dr. Kanaabi expressed gratitude to the government for its prioritization of the energy sector and inviting the Minister of Energy to update the nation on the sector’s achievements and future direction for 2025.
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