The flagship of IPS’s infrastructure investments in East Africa is the US$900 million Bujagali hydropower plant located on the River Nile. With a capacity of 250 MW, the Bujagali hydropower plant has doubled Uganda’s effective generation capacity and is currently providing 50% of the country’s electricity. In the past, frequent load-shedding or electricity blackouts were estimated to account for a 1-1.5 percent loss to Uganda’s GDP, thereby slowing the country’s economic development. With this significant increase in generation capacity, the project has virtually eliminated load-shedding and replaced emergency thermal generation. Access to reliable, more affordable and cleaner power has not only improved the investment climate across the country and the region, but also led to overall improvements in the quality of life.
Established through a public-private partnership model between the Government of Uganda and a consortium led by the Aga Khan Fund for Economic Development (AKFED) and Blackstone affiliates, the Bujagali Hydropower Plant has created jobs for Ugandan workers, improved community services such as the provision of clean water supplies, education and health facilities in nearby villages, micro-credit funds available to surrounding rural populations and other enhancements to local infrastructure.
Bujagali Energy Limited is a special-purpose company in which IPS, which is part of AKFED, is the leading promoter, and Sithe Global Power is a major shareholder. Other project partners include the Government of Uganda, the International Finance Corporation, the African Development Bank, the European Investment Bank, PROPARCO (France) and DEG (Germany). Bujagali is one of the largest independent power plants in sub-Saharan Africa.
The West Nile Rural Electrification Company (WENRECo), another AKFED project, supplies electricity to the West Nile region. Commissioned in 2012, the 3.5MW River Nyagak mini hydroelectric plant now provides a renewable source of energy in an area where only one percent of the rural population of 1.4 million previously had access to electricity. A first of its kind, the project was also the first in Africa to qualify under the World Bank-administered Prototype Carbon Fund, which generates funds for sustainable development through the purchase of project-based greenhouse gas emission reductions that are consistent with the Kyoto Protocol, the framework of Joint Implementation (JI) and the Clean Development Mechanism (CDM).
Supported by the Government of Uganda, German development institutions and the World Bank, the West Nile project provides an attractive model for rural electrification not only in Uganda but for Africa more broadly. A steady supply of electricity has already had an impact on the functioning of hospitals and schools, as well as on the growth of entrepreneurial activity in general and in basic agro-based industries in particular.
IPS has also made investments in several key industries, including Kampala Pharmaceutical Industries Ltd. (KPI), which is one of the largest manufacturers of pharmaceutical drugs in Uganda. It offers medicines in a range of therapeutic areas with a special emphasis on malaria. The company manufactures a range of over 70 registered products in Uganda, and also exports to Kenya, Rwanda, southern Sudan, and DRC.
Another IPS investment, Uganda Fishnet Manufacturers Ltd. (UFM) provides a locally manufactured supply of quality fishnets, an essential product for one of Uganda’s most significant export industries. Fishnets are produced in a manner that is consistently compliant with local, and international standards, thus promoting sustainable fishing practices.
Privatised in 1995, Leather Industries Uganda Ltd. (LIU) is a benchmark of environmental responsibility for other tanneries in the region, having adopted multiple environmentally friendly technologies, such as chromium recovery and a recycling plant. Leather Industries Uganda produces mainly wet blue for the export market, given that Ugandan hides and skins are naturally of high quality and texture.