Electricity Policy and Structural Reforms

Implications for Informal Settlements in Kampala, Uganda

Abstract

This study focuses on the experience of the electricity reforms from the perspective of household consumers in the informal sector in the urban and peri-urban informal settlements of Kampala, Capital City of Uganda. The purpose of this study was to assess the implications of electricity policy and structural reforms on the socio-economic welfare of informal settlement dwellers in Uganda. This was guided by three specific objectives, to examine the linkage between electricity structural reforms and electricity reform theoretical benefits; to analyze the effect of electricity reforms on household consumers in the informal sector; and to analyze challenges associated with the implementation of electricity reforms in light of the existing policies. The study reveals a poor link between theoretical benefits of reforms and structural reforms in Uganda owing to the size of the electricity power sector in relation to liberalization. Electricity sector reforms are not a panacea for improvement in the welfare of households in informal settlements. There is need for institutional and financial reforms, and deliberate policy implementation aimed at welfare improvement. The electricity sector in Uganda faces challenges in policy implementation due to insufficient funding and lack of proper coordination with government institutions for policy implementation. This mixed methods study inquired accessibility, affordability, usability, and reliability of the electricity services through semi-structured interviews in focus group discussions. The study found that usage of electricity is still low at 42%. The study recommended alignment of reforms to other planning departments in the government to help in the implementation process; rolling out a special program for increasing access and usage of electricity in informal settlements; and selective adoption of elements of the electricity reform agenda.