KAMPALA, Uganda — Uganda’s parliament approved a $121.9 million loan from the African Development Fund on Thursday to finance an electricity export project to South Sudan, a move that sparked sharp divisions among lawmakers.
While some legislators welcomed the project as a strategic regional investment that could generate foreign income, others warned it would worsen Uganda’s debt burden and disadvantage local consumers, who pay some of the highest electricity tariffs in East Africa.
The approval came after a plenary session on Oct. 30, 2025, chaired by Deputy Speaker Thomas Tayebwa.
Presenting a minority report, opposition lawmaker Charles Tebandeke expressed concern over missing key documents, including the memorandum of understanding, power purchase agreement and contracts between Uganda and its neighbors.
“We acknowledge that the regional power trade is increasing rapidly after exports to Rwanda, Kenya, Tanzania and the Democratic Republic of Congo. However, Ugandans have not known the MOUs behind these exports; it is a secret to government,” Tebandeke said.
He noted that while Uganda’s national grid coverage stands at 25.3%, only 15% of the population has access to reliable electricity.
“Where we export, importers enjoy a unit price cheaper compared to Ugandans. This has disadvantaged Ugandans, with places like Kalangala paying over 1,500 shillings per unit. Why is electricity still costly in Uganda?” he asked.
Naome Kabasharira, a lawmaker from Rushenyi County, decried persistent power outages and questioned the paradox of surplus generation and limited distribution.
“We have a lot of power generation in this country. What is making it hard to distribute? Now our people will see this loan to supply power to South Sudan, yet load-shedding is too much. Can we fix it?” she said.
Jonathan Odur, a member of parliament from Erute County, faulted the energy ministry for underperforming projects.
“The Electricity Scale-Up Access Project is at 20%. There is a transmission line in Masaka whose execution has not commenced. As a result, out of 10.8 million households, only two million are connected,” Odur said. “Government should not allow citizens who are going to shoulder the burden of this loan to continue crying for power.”
However, several MPs supported the loan, saying regional energy trade would strengthen Uganda’s economic position.
“This will be a good business for South Sudan because Ugandans do business there. Ugandans will also be beneficiaries, and in turn it will bring in income,” said Siraji Ezama of the ruling National Resistance Movement party.
Western Youth Representative Edson Rugumayo argued the export plan would help Uganda utilize its excess generation capacity.
“With this project, we project ourselves as powerful in the region,” Rugumayo said. “The majority committee report explains that in 2020 Uganda generated 2,000 megawatts but consumed only 900, leaving a surplus of 1,000. This loan is in the best interest of Ugandans, that we supply power to South Sudan and offset our debt burden.”
Defending the project, Minister of State for Energy Sidronius Okaasai said regional power trade is vital for economic growth and energy security.
“If we fall short of electricity, we should be able to import it. We must trade in the East African Community to avoid shortages. We have 2,056 megawatts and are using 900, meaning we have some electricity to sell,” Okaasai said.
A report by the Committee on National Economy, presented by its chair John Bosco Ikojo, revealed that the 299-kilometer power interconnector will start at the Gumbo substation on the outskirts of Juba, South Sudan, cross into Uganda at Nimule and terminate at the Olwiyo substation, which is supplied from the Karuma Hydroelectric Power Station.
Ikojo argued the project will address Uganda’s power surplus and South Sudan’s energy deficit. He projected Uganda will trade 624 gigawatt-hours of its surplus energy with South Sudan in the first year of operation, significantly reducing greenhouse gas emissions.
Parliament also passed two other loans: one worth 342.5 million euros from Standard Chartered Bank for the construction of a 400KV Karuma-Tororo transmission line and substation projects, and another for 230.4 million euros from Citi Bank to finance the design and construction of 127 kilometers of the Jinja-Mbulamuti-Bukungu Road and 10 kilometers of roads in Jinja City.
