GET FiT Uganda

The main objective of the GET FiT Program is to assist African nations in pursuing a climate resilient low-carbon development path resulting in growth, poverty reduction and climate change mitigation. The Program, which has been jointly developed by the Government of Uganda, ERA and KfW, is designed to leverage private investment into renewable energy generation projects in Uganda.

Fast facts:

The primary support component of the GET FiT Program is the top-up payment which is provided as a payment per kWh of generated electricity (result based financing) on top of the regulated Renewable Energy Feed in Tariff (REFiT);
The target is to use the available EUR 90 million in grant funding to leverage about USD 500 million in private investments into the sector; a leverage ratio of 1:5;
The GET FiT Programme improves the framework conditions for investments into renewable energies in Uganda, thereby effectively facilitating private investments into 170 MW of renewable energies.

The problem

Despite enormous potential for small renewable energy generation, Uganda has faced severe power supply shortages in the past. Since most of Uganda’s power is currently generated from large hydropower plants along river Nile, the country is heavily dependent on the water levels of Lake Victoria and hence very vulnerable to changes in rainfall patterns. Despite potential for renewable energy generation and interest of the private sector to invest, only few small scale renewable projects were developed in Uganda before 2012. Reasons for this were insufficient financial incentives (low renewable energy feed in tariff), perceived high economic and political risks, lack of bankable project documents (most importantly Power Purchase Agreement and Implementation Agreements) and consequently lack of access to debt and equity financing for project developers.

The solution

The GET FiT Program is designed to comprehensively address these issues and leverage private investment into renewable energy generation projects in Uganda. This is done with three components: a premium payment on top of the Renewable Energy Feed in Tariff (REFiT), a Partial Risk Guarantee provided by the World Bank and technical assistance to improve the legal and regulatory framework.
By introducing multiple renewable energy sources, dependency on the Nile is reduced and the electricity supply becomes less vulnerable to climate change. This is achieved not only by introducing new renewable technologies (biomass, bagasse, solar PV), but also by supporting small hydro power developments in different parts of the country – so that regional weather patterns do not have so much of an impact on power supply.

Helping the planet

The GET FiT Programme will lead to improved financial stability of the Ugandan energy sector and an improved private sector environment for renewable energy generation, which then results in a low carbon climate resilient development path.

Helping people

The major beneficiary of the GET FiT project are all current and future power consumers, including households, businesses and social institutions. GET FiT will result in an increase in Uganda's energy production by about 20%, and thus makes an important contribution to tackling an anticipated supply shortage. Furthermore, it will facilitate (or significantly improve) access to energy for at least 200,000 additional households (approximately 1.2 million people), also in rural areas due to strengthening of regional grids. During construction and operation of the renewable energy projects developed under GET FiT, 4,200 jobs will be created.

Scaling Up

Rather than supporting generation plants on a project by project basis, the GET FiT Program allows development partners to support more than 20 small renewable energy projects within the Program framework. The GET FiT Program is well on track to facilitate an additional 170 MW of renewable energy generation – thereby increasing the country’s power production by 20%. In Uganda, GET FiT intends to fast-track a portfolio of about 20-25 small-scale renewable energy generation projects (hydro, bagasse, biomass and solar/ PV), promoted by private developers and with a total installed capacity of up to 170 MW.