SACCOs to Manage Rural Electricity Supply

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The Uganda Rural Electrification Agency has intensified a campaign to encourage communities to form Savings and Credit Cooperative Societies for the sole aim of investing in rural power supply.

Godfrey Turyahikayo, Executive Director of Uganda Rural Electrification Agency, says the program will empower ordinary citizens to take charge of cost-friendly electricity management schemes and will increase efficiency and coverage of power across the country. Pilot projects are already in operation in Kanungu, Kibaale and Masaka districts. Several Savings and Credit Cooperative Societies (SACCOs) in Abim, Pader and Bundibugyo are awaiting financial support to start their projects.

Support for the SACCO-managed power projects has been given by the African Development Bank and the Islamic Development Bank.

Turyahikayo says they are based on models introduced in the United States in 1936. Rural-based organizations receive subsidized loans to build small hydropower dams or generate power from solar and wind stations or the sugar factory waste product, baggasse. The loans are repaid over a three year period.

Turyahikayo says that the Rural Electrification Agency is negotiating with the Microfinance Support Centre to provide financial subsidies to SACCOs to enable the rapid expansion of the solar energy scheme.

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The Pader-Abim Rural Electrification Cooperative Society, which was formed last year, intends to generate and distribute power to 1,606 people. It will construct a power line covering more than 153 kilometers from Corner Kilak to Abim via Patongo, Kalongo and Adilang in Pader district.i

Transformers placed along the power line will be provided through the Swedish International Development Agency.

In a separate program, Post Bank is offering loans to SACCOs to enable their members to purchase solar equipment. Beneficiaries are required to pay a deposit of 20 percent on the solar item before accessing the loans.