President Yoweri Kaguta Museveni has stopped renewal of Umeme’s contract, directing Minister of Energy to opt for cheap substitute.
He accuses the multibillion firm of conniving with corrupt government officials to inflate prices.
In his letter dated March 13, Museveni asked Minister Irene Muloni to shed more light on how Umeme’s technical losses still remain as high as 17% yet the company claims to have invested up to $500million in distribution infrastructure to address this problem.
In the run up to the concession signing in 2005, the Auditor General had calculated that Umeme’s losses, both technical (dilapidated infrastructure ) and commercial (power theft) would be at 28%.
Museveni insists this figure was inflated to 38% after Umeme bosses secretly met corrupt officials from the Ministry in America.
“If they have invested so much money, why do the technical losses not decline?” Museveni questioned.
“Why were the technical losses not eliminated? Why is the consumer being penalized for that? Why do the consumers have to pay for both the mysterious investments and the mysterious losses that should have disappeared long ago?”
He orders the minister to explain these inconsistencies, which he blamed on some elements in the ministry.
“There should be no question of renewing Umeme’s concession.”
He added, “Let us look for a cheaper way of modernizing and expanding the transmission and distribution lines.”
