- UMEME losses revenue
- This is the second year of declining revenues for the power distributor
- The ERA had announced a reduction in electricity tariffs for the 3rd quarter of 2021
Uganda’s sole electricity distributor, UMEME, is facing its second year of declining revenues. The country’s Electricity Regulatory Authority (ERA) had announced a reduction in electricity tariffs for the 3rd quarter of the year earlier in July. The reduction in tariffs will affect the already declining revenues of the utility firm in a country that is in the middle of the second lockdown due to the COVID19 pandemic.
Executives of the company are sceptical of the effects of the tariff reduction on the operations of the company “I am yet to look at the numbers, but with lockdown, demand in the city is down, because there is no activity. For domestic users, again, one may not have money in the pocket to buy electricity,” said Selestino Babungi, UMEME Managing Director.
UMEME revenues, last year dipped by 7% to Ush1.66 trillion ($466.5 million) compared to Ush1.77 trillion ($497.4 million) in 2019. According to the ERA, the impact of the pandemic lockdown imposed in June will have a negative impact on the sector. “This time, we will again see the impact of Covid restrictions, which are in force; hence demand will reduce, the sector will incur additional costs, and generation projects will delay,” said Vianney Mutyaba, Manager, Pricing ERA.