Uganda experienced significant growth in its solar energy capacity, reaching 92 MW in 2021 and further increasing by approximately 6.9 MW to a total of 98.9 MW in 2022.⁷

Uganda has ambitious plans for solar energy to contribute significantly to its energy mix by 2040. The country aims for solar power Uganda to account for 5,000 MW out of a total anticipated cumulative capacity of 41,700 MW by 2040. This goal is part of Uganda’s Vision 2040, which seeks to enhance energy security, support economic growth, and promote environmental sustainability.³⁵

The following are the average cost of electricity generation from different sources⁹

Uganda’s electricity generation is dominated by renewable sources¹¹¹⁰

• Hydropower: 89.5%.
• Others: 1.6%
• Biofuel: 7.1%.
• Thermal: 1%

The finding of specific and exact hours is challenging due to limited data availability online. The average daily availability of electricity from the national grid in Uganda is likely above 12-20 hours, but outages can still occur.¹²

In 2022, the total installed capacity for Solar Home Systems (SHS) & residential was 33.6 MW out of 98.9 MW. Based on this, we can estimate that around 34% of Uganda’s total solar PV installations fall under the “SHS & residential” category.⁸¹⁴

Uganda has seen significant development in its utility-scale solar sector. As of recent data, 3 major projects of solar energy in Uganda are operational: Kabulasoke Solar Power Station (20 MW), Soroti Solar Power Station (20 MW), and Tororo Solar North Power Plant (10 MW). While specific numbers on the total count of utility-scale solar farms are limited, it is clear that the country is actively expanding its solar infrastructure with the support of Solar System Installers in Uganda. These operational and upcoming projects demonstrate Uganda’s commitment to leveraging solar energy to meet its growing electricity demands and support sustainable development. The Ugandan government aims for a total installed solar energy capacity of 5,000 MW by 2040.¹¹¹⁰

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The off-grid solar panel market in Uganda is experiencing significant growth, driven by several factors, and is projected to continue expanding in the coming years. Here’s a breakdown of the current state and future prospects:

Current Demand Drivers:

A large portion of Uganda’s population (over 60%) lacks access to the national grid, making off-grid solar solutions a viable. Government policies promoting renewable energy and off-grid solutions create a supportive environment for solar. Globally falling solar panel prices make off-grid solutions more affordable for Ugandan households. Sales of Solar Home Systems (SHS) have been steadily increasing in Uganda, reflecting growing demand. Companies are offering a wider variety of off-grid solar products catering to different needs and budgets. Investments in the off-grid solar sector in Uganda are on the rise, indicating confidence in the market’s potential.

Projected Growth:

Uganda’s national electrification rate stands at 42.1 %, below the sub-Saharan African average of 43 %. The national electricity grid powers 60 % of urban areas and 18 % of rural areas. However, because the use of SHS in rural areas has grown from 18 % in 2017 to 38 % in 2020, grid use has dropped from 22 % to 19 % in the same period. As a result, off-grid systems can help to fill the energy gap by creating demand and providing energy access in rural areas, where 73 % of the population lives. These unelectrified rural areas present a business opportunity for off-grid energy providers to supply cleaner and more reliable power to households and businesses, helping Uganda achieve its universal electrification goal by 2030.

³⁵⁷

Uganda experienced significant growth in its solar energy capacity, reaching 92 MW in 2021 and further increasing by approximately 6.9 MW to a total of 98.9 MW in 2022.

Uganda has ambitious plans for solar energy to contribute significantly to its energy mix by 2040. The country aims for solar energy to account for 5,000 MW out of a total anticipated cumulative capacity of 41,700 MW by 2040. This goal is part of Uganda’s Vision 2040, which seeks to enhance energy security, support economic growth, and promote environmental sustainability​.

²¹

The average salary of workers in the solar industry is described below

• Electrical Engineer: USD 390.96- 781.93
• Electrician: USD 208.51- 390.96
• Design Engineering Manager: USD 781.93- 1303.22
• Solar Energy System Installer: USD 130.32- 312.77
• Solar Energy / Solar Power Engineer: USD 469.16- 912.25
• Solar Installation Electrician: USD 182.45- 338.84
• Business Development Manager: USD 521.29- 1042.57                    

As of May 19, 2024, the estimated population of Uganda is approximately 49.7millions.²²

Determining the exact average overhead cost of solar panel production in Uganda involves several key factors. Here’s a detailed breakdown based on available data:

Raw Material Costs: The cost of raw materials like silicon, aluminum, and silver constitutes a significant portion of the production costs. Globally, raw material costs account for approximately 20-40% of the production costs of solar panels​

Labor Costs:³² Labor costs in Uganda are relatively low compared to Western countries. However, they still contribute a significant portion to the overall overhead costs due to the need for skilled labor in the manufacturing and assembly process. The current minimum wage in Uganda is roughly equivalent to $35 USD per month.

Utilities and Energy Costs:⁴⁵ The energy-intensive nature of solar panel production means that utilities, particularly electricity, are a major cost component.

Electricity Tariff: The average cost per kWh from a utility company in Uganda depends on the type of consumer and their consumption level. According to current tariffs (April-June 2024) set by the Electricity Regulatory Authority (ERA), the electric tariff ranges.

Water Tariff:³³ The price per cubic meter increases as your consumption goes up, discouraging excessive use. Detail of water charges are as follows:

Facility Maintenance:³⁴ Costs related to maintaining manufacturing facilities, including rent, equipment maintenance, and repairs, also form a part of overhead costs. The investment in infrastructure, such as buildings and production lines, can vary but is necessary to maintain continuous production​. Here’s a rough estimate for industrial rents in Uganda (per month, USD):

• Smaller Factories (500-1000 sqm): $1,000 – $2,000 USD
• Medium Factories (1000-2000 sqm): $2,000 – $3,000 USD
• Larger Factories (2000+ sqm): $3,000+ USD

Administrative Expenses: This includes the salaries of administrative staff, office supplies, and other general expenses, which contribute to the overhead costs. Efficient management and automation can help reduce these costs but they remain a notable component. The average salary of workers in the solar industry is described below

• Electrical Engineer: USD 390.96- 781.93
• Electrician: USD 208.51- 390.96
• Solar Energy / Solar Power Engineer: USD 469.16- 912.25
• Solar Installation Electrician: USD 182.45- 338.84

Quality Control: Ensuring the solar panels meet performance and safety standards involves testing and inspections, which add to the overhead costs​.

Based on these factors, the overhead costs in Uganda, similar to other regions with developing manufacturing sectors, are a significant portion of the total production costs. However, due to lower labor costs and potentially lower facility expenses, the overall overhead costs might be lower compared to more developed countries.

Uganda’s energy infrastructure is undergoing development, with a focus on increasing access to electricity and transitioning towards renewable energy sources. Hydropower is the dominant source of electricity generation, accounting for over 80% of installed capacity. Biomass, solar, and thermal sources contribute a smaller portion to the energy mix. The government is promoting renewable energy sources like solar and geothermal to diversify the energy mix and reduce reliance on hydropower. Despite recent progress, Uganda’s national electricity access rate remains low, with only around 22.1% of the population having access as of December 2022. Financing large-scale infrastructure projects and expanding access to rural areas can be challenging. Overall, Uganda’s energy infrastructure is evolving, with a focus on increasing access to electricity, diversifying the energy mix with renewable sources, and improving the transmission and distribution network.²³²⁴²⁵

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Uganda’s regulations surrounding solar energy focus primarily on promoting its use rather than restricting it. Here’s a breakdown:

Regulations for Solar Panel Installations:

• Generally Permitted: Installing solar panels for residential, commercial, or industrial use is generally permitted in Uganda.
• Standards and Permits: The Uganda National Bureau of Standards (UNBS) likely sets standards for imported solar panels. Depending on the size and complexity of the installation, permits from local authorities might be required.

Regulations for Net Metering:

• Limited Availability: Currently, net metering regulations in Uganda are not well established. This means it might be difficult to connect your solar system to the grid and receive credits for excess electricity generation.

Tax Incentives:

• Import Duty Exemptions: Uganda offers import duty exemptions on solar panels, batteries, and other solar equipment to encourage adoption.

¹³²⁸²⁹

While Uganda’s solar panel manufacturing industry is still young, the government has shown interest in its development through various initiatives and strategies.

• Renewable Energy Strategy and Policy (2018): This strategy promotes the development of renewable energy sources, including solar, and could potentially provide a framework for supporting domestic solar panel manufacturing.
• Draft National Energy Policy (2019): This policy emphasizes diversifying the energy mix with renewables like solar, potentially creating demand for solar panels
• National Electrification Strategy (NES): The NES (finalized in 2022) aims for universal electricity access, and solar power could play a significant role. Increased demand for panels could incentivize domestic production.
• Energy for Rural Transformation (ERT) Project: This ongoing project utilizes various renewable energy sources, including solar, for electrification in rural areas. This project’s success could pave the way for a more robust domestic solar industry.
• Vision 2040: Uganda’s Vision 2040 sets the stage for a future where solar energy plays a significant role in achieving the country’s development goals. While a specific target for solar isn’t explicitly stated, the overall vision for electrification, environmental sustainability, and economic growth necessitates a strong focus on renewable energy sources like solar.
• National Development Plans: National Development Plans (NDPs) might outline broader goals for promoting domestic solar panel production.

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Installed

Uganda is making strides in developing solar energy, with several notable projects underway or recently completed.

1. 50 MW Tororo Solar Power Plant (Operational): This 50MW solar plant, located in Tororo district, became operational in 2020 and is one of the largest operational solar power plants in Uganda.
2. Kabulasoke Solar Power Station: This 20MW solar plant, located in Gomba district, became operational in 2019 and is operational solar power plants in Uganda.
3. Bufulubi Power Plant: Uganda’s Solar Energy production has increased following the addition of 10 MW to the national grid, with the commissioning of the Bufulubi Power Plant in Mayuge District in 2019.
4. Soroti Solar Power Station: This 20MW solar plant, located in Soroti district, became operational in 2016 and is operational solar power plants in Uganda.
5. Tororo Solar North Power Plant: This 10MW solar plant, located in Tororo district, became operational in 2017 and is operational solar power plants in Uganda

Projected

Uganda’s solar energy sector is experiencing significant growth, with several promising projects on the horizon.

• Emerging Africa Infrastructure Fund Invests in 20MW Ituka Solar PV Project: This project secured funding in November 2023 and aims to construct a 20MW solar power plant in the under-served northwestern region of Uganda. This project highlights the focus on expanding access to electricity in remote areas.
• 150MW Kabulasoke Solar Power Plant (Under Development): This project, signed in December 2023, involves the construction of a 150MW photovoltaic solar plant in the Kween district by a UAE-based firm, Masdar.
• Amea West Nile Solar PV Park, Uganda: Amea West Nile Solar PV Park is a 20MW solar PV power project. It is planned in Western, Uganda. The project construction is likely to commence in 2024 and is expected to enter into commercial operation in 2025.
• 170 MW deals with Masdar UAE state owned renewable Energy company: UAE state-owned renewable energy company Masdar has signed a number of agreements to develop new renewables projects in Africa, including 150MW of new solar capacity in Uganda. The company announced the deals during the COP28 conference, held in Dubai

Following notable solar companies are playing a crucial role in development of solar energy in Uganda³¹

• Akua Power (Blackstone Group company): Signed a Power Purchase Agreement (PPA) with the Ugandan government for the development of a 200MW solar power plant project in 2022.
• SolarAfrica Inc.: Ugandan company that assembles and distributes solar panels for domestic and commercial applications
• SolarVilla: SolarVilla intends to design and size solar photovoltaic systems for health centers in rural areas customized to meet the specific needs of that particular area of study.
• Innovex UG: Transforming the distribution of off-grid energy and equipment using IoT.
• Village Energy: Village Energy is a last-mile distributor of customized solar installations that enable productive use of energy for businesses, agriculture and community institutions.
• Powerhive: Developing and operating mini-grids powered by solar and battery storage.