The Independent Uganda: You get the Truth we Pay the Price
Kampala, Uganda | THE INDEPENDENT | The Electricity Disputes Tribunal has issued an injunction stopping the Electricity Regulatory Authority (ERA) from cancelling the license of power company Elemental Energy Services Ltd.
Elemental Energy holds a license to construct a 7MW Nyamabuye Hydropower project on River Kaku in Kisoro district, south western Uganda. The project is to cost USD 27 million.
In July 2019, ERA issued a license revocation notice to the company saying it “was unlikely to fulfill its obligations under the license”. ERA gave the company 45-days to show cause why the license shouldn’t be revoked.
Led by chairman Charles Okoth Owor, the tribunal ruled that the cancellation be stayed until the main complaint Elemental Energy filed against the regulator at the tribunal has been disposed of. Owor said that cancelling the license now might lead “the company to suffer irreparable damage.”
In November last year, the company missed a key date for financial closure – where financial arrangements are completed – but it asked for an extension to complete negotiations with financiers. But ERA refused to approve the company’s equity arrangement, claiming the partner Elemental was choosing had many uncompleted projects they were undertaking in Uganda.
The company decided to petition the tribunal to compel the regulator to approve the partner to pave way for the financial close to happen.
In August, Carol Kuteesa, the head of business development at Elemental Energy said they had done whatever they were supposed to do but the regulator is being unfair – and at worst having ‘sinister reasons’ to revoke their license.
She said they successfully did the feasibility study and spent more time doing the hydrology gauges to ensure the river has enough water for the project, a requirement for all projects that request for money from the World Bank.
River Kaku had never had a hydrology study done there. The hearing of the main complaint continues on January 31, 2019.
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