The Uganda Electricity Distribution Company Limited (UEDCL) has announced that it has secured $74 million (about Shs280 billion) to kick-start a major overhaul of the country’s ageing electricity infrastructure and expand the national distribution network.
The announcement comes just months after UEDCL formally resumed full control of electricity distribution following the expiry of UMEME Limited’s 20-year concession.
The new funding marks the first phase of a larger, long-term investment strategy valued at $350 million over the next five years. According to UEDCL, the immediate focus will be on refurbishing dilapidated infrastructure and installing technologically advanced systems to create a more robust, smart, and efficient power grid.
“This funding will enable us to install modern, technologically advanced equipment as we work towards building a robust, smart, safe, and efficient electricity distribution system,” UEDCL said in a statement.
“Our goal is to ensure a reliable and sufficient power supply that meets the growing needs of our customers,” it added.
The shift in responsibility from UMEME to UEDCL represents a significant transition in Uganda’s energy sector. UMEME’s contract, which ended in March 2025, had long been a subject of public debate, with concerns raised over high tariffs, billing practices, and infrastructure maintenance. Government officials maintained that bringing distribution back under public control would enhance efficiency and reduce electricity costs.
UEDCL’s $74 million investment will be directed toward immediate grid improvements, including replacement of outdated transformers, strengthening feeder lines, upgrading substations, and deploying smart grid technologies to improve power reliability and response times.
The broader five-year plan, valued at $350 million, is expected to tackle systemic weaknesses in the distribution network and cater to the growing demand for electricity driven by Uganda’s expanding industrial base, urbanization, and rural electrification goals.
Energy sector analysts note that UEDCL’s ability to manage such large-scale infrastructure investments will be critical in determining whether the public sector can effectively step into UMEME’s shoes and maintain—if not improve—service quality.
“The stakes are high,” said energy analyst Alex Kaggwa. “If UEDCL can deliver on this investment plan, it will signal that a government-led model can work. But delays or mismanagement would risk undoing progress made over the past two decades.”
As of 2024, Uganda’s electricity access rate stood at approximately 57% nationally, with wide disparities between urban and rural areas. The new investments are also expected to support the government’s ambitions under Vision 2040, which prioritizes industrialization and universal energy access as drivers of economic transformation.
In its statement, UEDCL reaffirmed its commitment to “strengthen the health and sustainability of Uganda’s electricity distribution sector, ensuring improved service delivery, grid reliability, and future readiness.”
The next few months will be pivotal as UEDCL rolls out its first projects under the new funding. Success will depend not only on engineering capacity but also on transparency, stakeholder engagement, and the ability to align infrastructure with Uganda’s long-term energy policy goals.
