While the cut for ordinary domestic consumers is negligible, commercial consumers will see theirs drop by at least Uganda shillings 3.8 to Ushs 645.6 in the period between April and June 2020, a significant relief for business people.
![]()
Electricity tariff cut by negiligible 1 shillings for domestic consumers for the April to June 2020 quarter
The Electricity Regulatory Authority-ERA has reduced power prices for domestic consumers.
Between April and June 2020, Ugandans will consume electricity by
at least one shilling less than what they paid in the quarter between January
to March 2020.
According to the ERA, domestic users –
where ordinary Ugandans fall – will pay Uganda Shillings 750.9 per unit down
from Uganda shillings 751.7. This is a 0.8 shillings drop.
While the cut for ordinary domestic consumers is negligible, commercial
consumers will see theirs drop by at least 3.8 shillings to 645.6 shillings in
the period between April and June 2020, a significant relief for business
people.
However, the shutdown of the economy due to Covid-19 means they too can’t
consume because many of them are not working. The bigger factories - classified
as big consumers - also had a cut of Uganda shillings 1.4 to Shs 361 per
unit.
ERA uses different parameters to determine the electricity tariff for a
particular quarter, including exchange rate, prices of oil and inflation
levels. The Uganda shillings lost up 2.2% of its value in March to trade in the
highs of 3,900 for one dollar, according to Bank of Uganda.
It has since gained some losses to trade in the ranges of Shs 3800 for a
dollar. How the dollar pairs with the shilling are impact factor in the tariff
because distributing and generating companies import materials to invest using
the dollar. If it becomes more expensive, it means power tariff will likely
move up.
Also, the price of oil is considered. ERA says they used the average price of
USD50 of February. The oil is used to run some of the machines to generation
but also geothermal backup companies like Jacobsen depend entirely on
oil.
A sustained fall in oil prices could push electricity tariff down although the
uncertainty around Covid-19 means ERA may trade carefully to cut.
While President Yoweri Museveni had said utility suppliers should not be
disconnected for non-payment, those on the pre-paid metering system have no
option but to pay when their units run out.
The system simply cuts one-off when their units expire.
