AES Nile Power was the initial private sector partner. First, the capital costs of the project were substantially overpriced. The PPA, in addition, was found to contained irregular provisions that were not in the best interest of Ugandans. These were approved by both the Ugandan government and the World Bank.
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These explain the year gap between its approval and completion. The project involved the development of a MW hydropower plant on the Nile, about 8 kilometres downstream of the existing Kiira Power Station.
It also included construction of a kilometre transmission line, substations and other associated works. AES pulled out of the project in , and as a result, the dam project stalled for five years.
UETCL , a state-owned enterprise. These projects had their own funding arrangements. It missed some of its major goals, and had serious repercussions on the environment and on surrounding communities: Electricity prices in the country actually increased. The receding shoreline has caused serious harm to water supply systems, boat operators and farmers. It is estimated that the lake catchment supports about one-third of the total population of Kenya, Uganda and Tanzania.
In , " people filed a complaint in court class action against Uganda Electricity Transmission Company limited UETCL , on the basis of the Constitution and the Land Act, which provided for fair and adequate compensation. They applied for a temporary injunction, and the injunction was granted. AES Nile Power and Bujagali Energy Limited were the two main companies involved in the construction and feasibility analysis for the dam, and the government and other international organisations provided financial and operational backing.
For example, the rightful Cultural and Spiritual Leader of the Basoga Clans attached to Bujagali Falls, Nabamba Budhagali, was not consulted by the dam developers on the impact of the dam on the Spiritual Shrines at Bujagali Falls.
The dam was nevertheless approved by the [government] and the international financial institutions, and construction started, ignoring the outstanding concerns. To promote growth, and mobilise private capital by promoting private sector ownership and management of the power sector, and sector reform. It also provided the opportunity for institutions such as the World Bank Group to evaluate the lessons, including the outcomes and recommendations of the World Bank Inspection Panel review, in order to better understand the concerns of stakeholders within and outside Uganda.
Building on that, BEL conducted further field studies and analyses, where needed. The project cost doubled from the time it was first proposed until it was approved. From January to end of March , the Bujagali cost has risen from USD million to USD million and is expected to escalate even higher when other additional costs are included However, it faced delays according to the project plan, so BEL appointed a witness NGO, Inter-Aid, to observe the resettlement and compensation process.
However, they each followed their own independent procedures for reviewing compliance. There is no evidence of an ongoing internal monitoring of the progress of the project.
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