The final deal was signed on December 21 and takes immediate effect, according to the statement by the World Bank country manager for Uganda Ms Grace Yabdrudy.

'We the close of contract negotiations between the Bujagali Energy Limited (EBL) and the project’s commercial investors as an example of partnerships that can make a difference in Uganda’s and Africa’s development" , the statement said on Friday.

It added "the 250 mw project on the Nile river is an integral component of Uganda’s strategy to close an energy supply gap that seriously constrains the country’s social and economic development.

"The dam is expected to bring a more reliable and accessible power supply that will help create jobs, reduce poverty, and improve quality of life".

Once commissioned in 2011, the run-of-river hydropower plant will increase the supply to national power grid at the lowest cost compared to other power generation expansion options under Uganda’s energy sector.

The World Bank Group’s financial support comprises $130million (Shs221billion) in loans; a partial risk guarantee of up to$115million (Sh195.5billion)and an investment guarantee of up to$115million(Sh195.5billion).

Officials said the dam is an important element in Uganda’s strategy to develop a reliable and accessible electricity sector, which is critical for the country’s economic growth and development.

"The international Financial Corporation(IFC)is pleased that work on the project has commenced , as it is expected to reduce power shortage as well as carbon dioxide emissions in Uganda, thus lessening the need for more expensive thermal power", said Mr Rashad Kaldany, IFC’s director of infra structure.

The Bujagali Hydropower project is one element of the World Bank Group’s support for Uganda’s energy sector strategy.

Other development projects being supported include a $300 million (Sh510 billion) power sector Development Operation that provides funding for a set of investments and policy measures designed to reduce the supply-demand gap until the Bujagali hydropower plant comes into service.

This is a very positive and promising future for the investment opportunity in this pearl of Africa (Uganda).With a steady and sustainable power supply, industrialisation of Uganda is certainly a very big realisation.

Keywords:  uganda development energy