Kampala– Uganda government has received Shs1.3 trillion from the European Union, Germany and France to help strengthen energy development in the country.
According the statement from the European Union, the signing took place on May 18-21, New York between Energy Minister Irene Muloni and a joint delegation from the above countries.
During the signing, Ms Muloni, stated that government has prioritized investments in energy to facilitate accelerated growth of the sector to improve service delivery. “The SE4ALL Action agenda developed by the government of Uganda will be an important tool in bringing private sector, civil society, development partners (and in particular the European Union and its member states) and government agencies together in prioritizing the actions to meet our objectives”.
The joint declaration with Uganda – co-signed by Germany and France – will serve to reinforce the political ownership and the partnership between Uganda and the European Union and its more active Member States in the sector, France and Germany, in the field of energy policy and investment in renewable energy.
In Uganda, France, Germany and the EU are currently financing projects for more than €406 million (Germany €240 million, France €116 million and European Commission €50 million) in the Sustainable Energy sector.
Below is the statement in full.
Uganda, European Union, Germany and France reinforce their Partnership towards development of Sustainable Energy Shs1.3 trillion in grants and loans.
May 20, 2015, New York, EU Commissioner for International Cooperation and Development, Neven Mimica, the Ugandan Minister of Energy, Irene Nafuna Muloni, and the representatives of France and Germany have signed a joint declaration underlying their mutual commitment towards the development of Sustainable Energy in Uganda.
The signature took place in New York in the framework of the 2nd High-Level “Sustainable Energy for All” Forum hosted by the United Nations between May 18 -21. Minister Muloni and the EU Commissioner also participated in the launching of the new EU instrument, called “ElectriFI”, a financing mechanism for rural electrification projects to reduce energy poverty and ensure viable access to affordable energy services in the EU partner countries.
Ahead of the event, Commissioner Mimica said: “The EU joined the UN Secretary General initiative to provide sustainable energy for all by 2030 right from the start. Fulfilling this promise will require strong cooperation and the political will of our partner countries. Our ElectriFI initiative will, in combination with other financing resources offered by the EU, help ensure that access to affordable energy services will be possible for poor households in rural areas. The joint declaration with Uganda confirms our political determination to work closer in partnership to fight energy poverty. “.
Ms Muloni, has stated that “Government has prioritized investments in energy to facilitate accelerated growth of the sector to improve service delivery. The SE4ALL Action agenda developed by the government of Uganda will be an important tool in bringing private sector, civil society, development partners (and in particular the European Union and its member states) and government agencies together in prioritizing the actions to meet our objectives”.
ElectriFIis not only a financing mechanism, it puts forward an innovative business model to leverage more private investments and involve more key stakeholders in all areas of expertise on a global level. It has the potential to take donor funding and increase it five or ten fold. Through ElectriFI, EU grants will complement private financing, bridging potential financial gap in order to make a project bankable. This will provide the security investors and banks are expecting to boost investments. If investments are successful, the grants will be converted into loans, at a concessional rate, and the EU will be “reimbursed”. The EU will then be able to reinvest its grants in new projects, allowing more and more people to get access to electricity services. A total of €270 million have been earmarked to support this effort.
The joint declaration with Uganda – co-signed by Germany and France – will serve to reinforce the political ownership and the partnership between Uganda and the European Union and its more active Member States in the sector, France and Germany, in the field of energy policy and investment in renewable energy.Germany is financing alone more than 240 Million Euro, France another 116M€ and the European Commission additional 50M€, for a total of nearly Shs1.3 trillion.
This is a clear sign of the commitment of the European Union and its member states to strengthen cooperation in the field of energy with Uganda and the key development partner, and it will be used as a concrete road-map for action.
Nearly 1.3 billion people in the world do not have access to electricity and 2.7 billion rely on the traditional use of biomass for cooking. The situation in sub-Saharan Africa is particularly concerning. On current trends, 75% of the global population without electricity access will be concentrated in this region by 2040.
Rural electrification projects, which are smaller in size, require a different approach. In less than two years, the EU has provided significant grants to 31 projects, targeting more than 3 million people directly and many more indirectly in 20 countries.
In Uganda, France, Germany and the EU are currently financing projects for more than €406 million (Germany €240 million, France €116 million and European Commission €50 million) in the Sustainable Energy sector.
In the period up to 2020, the European Union will invest overall €3.5 billion in the creation of sustainable energy systems. This is expected to leverage between €15 and €30 billion in loans and equity investment.
