Uganda’s power tariffs to stay flat into early 2026, but consumers still grappling with outages

Ugandan electricity consumers will pay unchanged power tariffs for the first three months of 2026, extending a period of price stability even as frustration grows over persistent outages and uneven supply across the country.

According to the Electricity Regulatory Authority (ERA), tariffs for the January–March 2026 quarter will remain the same as those charged in the final quarter of 2025, marking the third consecutive quarter without adjustments.

For domestic consumers, the lifeline tariff remains at Shs250 per unit for the first 15 kilowatt hours, while the average domestic tariff stands at Shs756.2 per unit. Commercial consumers will pay an average of Shs546.4, while medium-scale manufacturers will pay Shs355.1 per unit, down from Shs417.8 previously.

Large industrial consumers will pay Shs300.4 per unit, compared to Shs351.5, while extra-large industrial users — including steel and cement manufacturers — will pay an average of Shs203.6, down sharply from Shs299.1.

ERA says the tariffs, though unchanged for three quarters, are on average 14 percent lower than 2024 levels, with the manufacturing sector enjoying the biggest reductions — a move government hopes will support industrial growth and competitiveness.

Stability on paper, frustration on the ground

While tariff stability has been welcomed, it has done little to calm public anger over erratic electricity supply, which has dominated much of the electricity year 2025.

The transition in April from Umeme Ltd to the state-owned Uganda Electricity Distribution Company Ltd (UEDCL) was initially greeted with optimism, but that goodwill has quickly faded as households and businesses continue to report frequent outages, voltage fluctuations and delayed restorations.

Public forums and social media platforms have been flooded with complaints, with some consumers — half-jokingly — calling for the return of Umeme.

Domestic and commercial consumers, much like industrial users, say reliability now matters more than tariff reductions.

Why tariffs came down

ERA attributes the tariff reductions seen since 2024 to several factors, including the appreciation of the Uganda shilling against the US dollar and projected growth in electricity demand.

The former ERA Board chairperson, Sarah Kanaabi Wasagali, previously said demand was expected to grow at an annual rate of 10.54 percent in 2025, helping spread fixed costs over higher consumption.

Ms Wasagali was replaced in October by Grania Rosette Rubomboras, who now chairs the regulator’s board. She has reiterated that tariffs are determined through an open and participatory process.

She said consumer tariffs are set following the Annual Tariff Review Public Hearing, a process meant to rigorously test proposed expenditures, capture public feedback and reinforce accountability.

ERA promises improvement in 2026

ERA chief executive officer Eng Ziria Tibalwa Waako acknowledged the widespread disruptions experienced over the past year and admitted that lower tariffs alone are not enough.

“We are acutely aware that many households, businesses, and institutions have experienced power interruptions during the year, and we recognise the inconvenience and economic strain this has caused,” she said.

According to ERA, Uganda’s installed electricity generation capacity now stands at 2,098 megawatts, supported by 5,383 kilometres of transmission lines and nearly 80,000 kilometres of distribution infrastructure.

Peak demand rose to 1,300 megawatts by June 2025, a 25 percent increase from the previous year, while grid connections climbed to 2.52 million customers, translating into an estimated 60–65 percent national electricity access rate.

Despite these gains, Eng Waako said several challenges continue to limit service delivery, including high energy losses, vandalism of infrastructure, land-related delays in projects and supply reliability constraints.

“Overcoming these barriers is essential for sustaining sector growth and ensuring that electricity remains both reliable and affordable,” she said, adding that this would require joint efforts by government and the public.

She acknowledged that some of the service disruptions were linked to the transition from Umeme to UEDCL.

“We acknowledge the challenges that accompanied this transition, particularly those affecting power supply and network performance. We have listened carefully to consumers who experienced prolonged outages, voltage fluctuations, and delayed restoration during this period,” she said.

ERA, she added, has intensified regulatory oversight, directed corrective measures and approved targeted investments to stabilise the network.

“While lower tariffs have eased the cost of electricity for many consumers, affordability alone is not sufficient without a reliable supply. Addressing reliability challenges therefore remains a central focus of our regulatory efforts.”

The Ministry of Energy and Mineral Development maintains that UEDCL’s struggles are not due to lack of capacity, but rather the poor state of infrastructure inherited from Umeme, combined with a sharp increase in demand.

Energy minister Ruth Nankabirwa said government is continuously strengthening UEDCL to improve distribution and stabilise supply.

“Our focus remains delivering a stable, reliable power supply for Kampala and the country by 2026,” she said, citing the recently upgraded Kampala South Substation.

The substation’s capacity has been expanded from 20MW to 34MW, a move UEDCL says will improve supply along Entebbe Road and surrounding areas, including Makindye, Salaama, Ndejje, Lubowa, Kajjansi and Lweza.

According to UEDCL, the commissioning of a new 10/14MVA transformer will benefit more than 108,000 households and 650 commercial consumers, significantly reducing outages.

Similar upgrades have been completed in Kakiri, Kabale, Masaka, Kumi and Mubende as part of a national grid optimisation programme.

Government is also banking on new generation projects to ease supply pressures. Currently, 28 projects are at feasibility stage, while 31 licensed projects with a combined capacity of 324.6MW are under development across hydropower, solar, biomass, wind, cogeneration and gas-to-power technologies.

About 65MW is expected to be added to the grid by the end of 2026.

Under the National Energy Policy 2023, Uganda aims to expand generation capacity to 52,481MW by 2040, including plans to develop 24,000MW of nuclear power and tap an estimated 1,500MW of geothermal potential.

For now, while tariffs remain steady, consumers appear less concerned about price relief than about when the lights will stay on consistently — a test that 2026 may prove decisive for UEDCL and the wider power sector.