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AfDB approves $8.6 million top-up to complete compensation under Uganda rural electrification project

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The African Development Bank Group (AfDB) has approved $8.6 million in additional financing to support the completion of compensation payments to people affected by the Uganda Rural Electricity Access Project (UREAP) Phase I, helping close a critical funding gap and ensuring the project delivers its full development impact.

 

Approved on April 7, the top-up will address updated cost estimates identified during implementation and cover outstanding environmental and social commitments. It is expected to ensure all project-affected households receive due compensation and that remaining connection works are completed.

 

UREAP Phase I, approved in 2015, has expanded electricity access in rural and peri-urban areas by connecting households, businesses and public institutions to Uganda’s national grid. The project delivered last-mile connections to 137 770 households, benefiting about 670 000 people. “This financing ensures that no community is left behind,” said the Bank’s East Africa Regional Manager for Energy, Aleymahu Wubeshet-Zegeye. “It allows us to complete what we started, honour commitments made to affected families and secure lasting development impact.”

 

Alongside the additional Phase I financing, the AfDB also approved UREAP II on April 7. Phase II has a total cost of $122.85 million, comprising an African Development Bank loan of $101.89 million, a $15.22 million loan and $2.02 million grant from the Climate Investment Funds, and $3.72 million in counterpart funding from the Government of Uganda.

 

UREAP II will construct about 624 km of medium-voltage and 2 154 km of low-voltage distribution networks. Over six years, it is expected to deliver about 259 723 new grid and mini-grid connections, including more than 250 000 households, 3 000 businesses, and public facilities such as schools and health centres.

 

The new connections build on the 141 700 already achieved under Phase I and are expected to provide first-time electricity access to nearly 1.18 million people, reducing reliance on fossil fuels and unprocessed biomass.

 

The programme aligns with the AfDB’s Country Strategy Paper for Uganda (2022–2026) and contributes to Mission 300, a joint initiative with the World Bank Group to connect 300 million people in sub-Saharan Africa to electricity by 2030.

 

–AfDB/ChannelAfrica–

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