KAMPALA, UGANDA – In a critical engagement for Uganda’s industrial sector, the Uganda Manufacturers Association (UMA), through its Economic & Business Policy Committee, is meeting with the Electricity Regulatory Authority (ERA) today, June 23rd, for their quarterly tariff review. The meeting is set to deliberate on the electricity tariffs for the third quarter of 2025 and address key energy sector updates that directly impact the cost of production and competitiveness of local industries.

This routine quarterly meeting carries significant weight for every manufacturer in the country, as the cost and quality of electricity are fundamental drivers of business viability. The discussions are expected to be centered on two main pillars: the per-unit cost of power and the persistent challenges of supply reliability.

The Push for a Competitive Tariff

While manufacturers acknowledged a slight reduction in the tariff for the second quarter of 2025—which saw the rate for large industrial consumers set at UGX 435.0 per kilowatt-hour (kWh)—the sector’s advocacy body maintains that this is still too high to be competitive.

UMA has been consistent in its long-term advocacy for an industrial power tariff of US 5 cents (approximately UGX 190) per kWh. They argue that achieving this target is essential for leveling the playing field with regional competitors in countries like Ethiopia and Egypt, where industries enjoy significantly lower power costs. The discussion today will likely push for a clear and actionable roadmap from ERA on how and when this competitive tariff can be achieved.

Beyond the Tariff: The Hidden Costs of Unreliability

A key point of discussion will be the issue of power quality and supply reliability. Even with a managed tariff, frequent power outages and voltage fluctuations force manufacturers to rely on expensive diesel generators. This not only negates the benefits of grid electricity but significantly increases the effective cost of energy, disrupting production schedules and risking damage to sensitive machinery.

Manufacturers are looking to ERA to enforce stricter service quality standards on distribution companies and to ensure that investments in the grid are prioritized to reduce system losses and improve stability, particularly in designated industrial zones.

Seeking Predictability for Industrial Growth

For the manufacturing sector, the overarching goal of these engagements is to secure a predictable, fair, and competitive energy regime. The agenda for today’s meeting includes:

• Reviewing the factors—such as inflation, exchange rates, and fuel costs—that will influence the tariff for Q3 2025.
• Discussing the progress on grid expansion and infrastructure upgrades to support industrial growth.
• Seeking transparency in the tariff-setting mechanism to allow for better long-term financial planning.

The outcomes of today’s dialogue between UMA and ERA will have a direct and immediate impact on the operational costs and investment decisions of manufacturers for the upcoming quarter. The entire industrial sector is watching closely, hopeful for outcomes that will spur growth, enhance competitiveness, and support Uganda’s broader industrialization agenda.