Rural Electrification Agency merger left Energy Ministry Shs570 Billion Debt

What the report says

Uganda’s push to expand electricity access in rural and underserved areas is being complicated by a large inherited debt after the Rural Electrification Agency (REA) was absorbed into the Ministry of Energy and Mineral Development, according to Watchdog Uganda. State Minister for Energy Sidronious Okaasai told Parliament that the ministry took on outstanding obligations from contracts that were still being implemented when REA was mainstreamed, leaving it with a Shs570 billion burden.

Okaasai presented the rural electrification status report to Parliament on Thursday, 13 August 2026, with Deputy Speaker Thomas Tayebwa presiding. He said the ministry had received about Shs222.078 billion over the following four years, which he described as far below the inherited liabilities. He added that the ministry needs about Shs200 billion each year to clear old commitments and support new rural power projects, and that it has asked the Finance Ministry to increase the programme allocation to Shs161 billion in the 2026/2027 budget from Shs35 billion in 2025/2026.

Lawmakers used the debate to raise wider concerns about slow electrification, unpaid land compensation, delayed counterpart funding and villages where poles have been installed but wiring has not followed. Several MPs argued that unreliable electricity is still limiting development in their constituencies and weakening the country’s industrial ambitions.

The report also cited progress under several projects, including new lines, transformers and consumer connections, but said some projects closed with unfinished work or unpaid claims. Taken together, the discussion shows the gap between Uganda’s electrification goals and the financing challenges facing the sector.