THE ELECTRICITY (AMENDMENT) BILL, 2022
MEMORANDUM
1. The principles of the Bill The objects and principles of this Bill are to amend the Electricity Act, Cap. 145 to provide for a staggered term of office for the members of the authority; to provide for additional functions of the authority; to increase funds allocated to the Electricity Regulatory Authority from 0.3 percent to 0.7 percent of the revenue received from generated electrical energy; to empower the Minister to prescribe the procedure for transfer of generation assets to the Government; to prescribe the circumstances under which a holder of a generation licence or transmission licence may supply electricity to persons other than a bulk supplier; to provide for deterrent penalties for theft of electricity and vandalism of electrical facilities; to provide for the membership and funding of the Electricity Disputes Tribunal; and to provide for related matters.
The proposal to amend the Electricity Act, Cap. 145 is intended to remove inconsistencies in the law, introduce flexibility in its implementation and to streamline operations of the electricity sector.
2. Defects in the existing law The Electricity Act, Cap. 145 (the “Act”) was enacted in 1999 and a lot has changed in the electricity sector since then.
The current law
Bill No. 1 Electricity (Amendment) Bill 2022
BILLS SUPPLEMENT No. 1 14th January, 2022
BILLS SUPPLEMENT to The Uganda Gazette No. 2, Volume CXV, dated 14th January, 2022 Printed by UPPC, Entebbe, by Order of the Government.
ii Bill No. 1 Electricity (Amendment) Bill 2022 does not effectively address issues of institutional responsibilities and efficiency, enforcement of compliance, and adequate penalties for theft of electrical energy and vandalism of electrical facilities. The Act provides for funding of the Electricity Regulatory Authority of 0.3% of the money collected from sale of electricity which is not sufficient to run the activities of the authority.
In addition, the Act does not empower the Electricity Regulatory Authority to impose sanctions on licence holders for breach of the terms of the licence. This has curtailed the capacity of the authority to enforce compliance.
Further, the current law provides for a single buyer model with the licence to purchase all electricity generated in Uganda awarded to a single institution, the Uganda Electricity Transmission Company Limited, yet the transmission network does not cover the whole country. At the same time, it is not economically viable to extend the transmission network grid to some remote areas with low electricity demand.
Therefore, there is need to amend the law to allow isolated power generation plants to sell electricity to distribution companies or directly to consumers for both technical and commercial expediency.
The penalties under the current law are not deterrent enough to discourage theft of electrical energy and vandalism of electrical equipment. These criminal acts have consistently increased the cost of operation and maintenance of electricity infrastructure as well as the commercial losses experienced by the electricity distribution companies.
Regarding the Electricity Disputes Tribunal, the current membership is three and all the three members must be present for the tribunal to perform its functions. The absence of any one member renders the tribunal non-functional. This has necessitated the amendment of the law to increase the membership of the tribunal to seven to enable it perform its functions efficiently.
Electricity (Amendment) Bill, 2022 to print_220127_184755 (Click here to read the whole document)