PROCEDURE FOR GETTING ELECTRICITY DISTRIBUTION AND SUPPLY LICENSE IN UGANDA

LAWS APPLICABLE INCLUDE,

§ CONSTITUTION OF THE REPUBLIC UGANDA OF 1995 AS AMENDED.

§ ELECTRICITY ACT OF 1999

§ NEMA ACT

§ LAND ACT AS AMENDED

ERA means ELECTRICITY REGULATORY AUTHORITY.

This Act means ELECTRICITY ACT CAP 145.

Electricity Licenses in Uganda may be granted upon an invitation of tenders by ERA or pursuant to an application by a person who intends to develop a particular a project in Uganda.

In Uganda any interested investor in electricity sector can apply for

Ø Feasibility study license or permit,

Ø Distribution license,

Ø Distribution and supply license,

Ø Generation license

Ø Transmission license

Ø Export license

Ø Import license

Ø Sale license

Ø System operation and bulk supply of electricity.

For purposes of this post we shall look at Distribution and supply license

· The purpose of this license is to regulate the distribution and supply of electricity in Uganda

Distribution means the ownership, operation, management or control of distribution facilities for the movement or delivery of electricity to consumers.

Supply means the supply to consumers, generation ,transmission, distribution and sale, including importation and exportation, of electrical energy;

· No person shall distribute electricity in Uganda without a distribution license granted by the ERA.

· The area of distribution shall be defined in the license.

· The ERA may, by instrument of authorization, delegate to a local government its power to license distribution systems with annual sales of less than four gigawatt hours.

· The ERA may withdraw the delegation if the bulk supplier does not exercise its functions in accordance with the authorization.

The following are procedures for getting Electricity Distribution and Supply License in Uganda

v Incorporate a company for purposes of carrying out distribution and supply of electricity in Uganda (see my earlier post on how to register accompany in Uganda).
v Prepare the following,

(a) Information on the financial and legal status and the technical and industrial competence and experience of the intended applicant;

(b) A description of the project and the time plan for the execution of the project;

(d) A review of public and private measures necessary to carry out the project;

(e) Information relating to permissions required from public authorities;

(f) a description of the impact of the project on electricity supply, socio-economic, cultural heritage, the environment, natural resources and wildlife; and

(g) Any other relevant information requested by the authority.

Obtain the Notice of intended application from ERA together with payment slip.
Prepare Notice of intended application by filling and indicating the above listed items.
Proceed to the bank and pay Notice of intended application fee.
Notify ERA of the intended project for distributing and supplying of electricity in the prescribed form containing as far as possible the above listed items by submitting it at their offices.
Within thirty days after receipt of a notice of intended application, ERA shall cause the notice to be published in the Gazette and in at least one national newspaper of wide circulation in Uganda.
Publication of a notice shall contain a summary of the notice; and inform members of the public that the notice may be inspected at the offices of the authority and at a public office within the jurisdiction of the local governments affected by the project.
ERA shall then invite directly affected parties and affected public agencies to make comments on the notice within a fixed period of not less than thirty days after publication of the notice.
ERA may, not more than thirty days after the receipt of the comments, issue a permit in the prescribed form to the intended applicant.
A permit issued shall allow the intended applicant to carry out studies and any other activity that may be necessary to enable the intended applicant to prepare an application for a license.
Upon getting this permit, carry out studies and any other related activity as per the permit to enable you prepare the application for distribution and supply license.
Once you have conducted the study mentioned above, prepare the following,

(a) The legal and financial status of the applicant;

(b) A technical and economic description of the project;

(d) The planned time of commencement and completion of the construction of the project;

(e) A view of the project’s adaption to the landscape, including necessary maps and drawings;

(f) The impact of the project on public interests and possible mitigation;

(g) The results of assessments, including environmental impact assessments, and studies carried out and reports of those assessments and studies;

(h) Impacts of the project on private interests, including the interests of affected landowners and holders of other rights;

(i) Consents and permits required under any other law,

an evaluation by the applicant of all comments made under section 30 of this ACT

Obtain the application for distribution and supply license from ERA together with payment slip for the application fee.
Fill in the application accordingly indicating clearly the above listed items
Proceed to the bank as advised and pay accordingly.
Attach payment receipt on your application and submit it to ERA for consideration
The ERA shall within thirty days after receipt of the application, confirm in writing to the applicant, that the application is complete in all aspects.
The ERA may require an applicant to make such arrangements as may be satisfactory to the authority for the execution of a bond or other form of security for the performance and observance of the conditions to which the license may be subject
The ERA shall require the applicant to take the necessary insurance policies to protect against liabilities that may arise as a result of activities done under the license.
The ERA shall process the application for a license expeditiously and in any case not later than one hundred and eighty days after the authority receives the application.
The ERA shall, within forty-five days after receiving the application, cause a notice of the application to be published in the Gazette and in at least one national newspaper of wide circulation in Uganda.

(a) A notice published shall indicate the receipt of the application for a license;

(b) Contain a description of the nature and location of the proposed undertaking;

(c) Inform members of the public that the application may, within the limits of commercial confidentiality, be inspected at the offices of the ERA;

(d) Invite directly affected parties and local authorities in areas affected by the project who object to the granting of the license, whether on personal, environmental or other grounds, to lodge with the authority an objection within a specified time, being not less than thirty days of the notice.

An affected party may lodge with the authority an objection to the grant of a license, setting out the grounds of the objection.
The ERA shall, in granting or rejecting an application for a license, take into consideration as far as is adequate for the project applied for—

(a) The energy needs of the country, region or community;

(b) The impact of the operations of the undertaking on the social, cultural and recreational life of the community;

(c) The need to protect the environment and to conserve the natural resources; (d) land use and sitting or route of the project;

(e) The costs of the project;

(f) the ability of the applicant to operate in a manner designed to protect the health and safety of users of the service for which the license is required and other members of the public who would be affected by the operations of the applicant;

(g) the technical, economic and financial capacity of the applicant to render the service for which the license is required;

(h) Energy efficiency;

(i) Any representations and objections made under section 36 of the Act;

(j) Other public and private interests affected by the operation for which the license is required;

(k) The price or tariff offered.

Never the less ERA shall, in granting a license, take into consideration the policies of the Government and any other matter that it may consider likely to have a bearing on the operations of the applicant.
Where the license is granted, execute agreement with interested parties and begin operations.
In case of refusal to grant a license ERA shall give the applicant a statement of its reasons for the refusal within thirty days after the refusal.
A person aggrieved by the refusal of the authority to grant a license may appeal to the tribunal for consideration of his or her application.

Processing this particular license may take up to 6 months..

Author is A regional transactions legal consultant (ADVOCATE) at NOA REGIONAL ASSOCIATED ADVOCATES AND LEGAL CONSULTANTS
Email address: onlinetransactionconsultancy@gmail.com.

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NOTE: whereas the author has made necessary efforts to ensure the accuracy of this post, it is not intended to provide specific legal advice to a particular individual as individual situations may differ.

For specific technical / legal transaction advice on this subject matter and related subject, you may contact the author at online consultancy fee, or contact any transaction legal consultant of your choice.
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PROCEDURE FOR GETTING ELECTRICITY DISTRIBUTION AND SUPPLY LICENSE IN UGANDA