Uganda’s energy sector is defined by a difficult contrast. The country produces most of its grid electricity from renewable sources, especially hydropower, yet millions of people still lack reliable electricity and clean cooking options. At the same time, Uganda is preparing to become a commercial oil producer through major developments around Lake Albert.
This creates an unusual energy path. Uganda is not simply replacing fossil fuels with renewables. It is trying to expand electricity access, support industrial growth, reduce dependence on charcoal and imported petroleum, and build an oil industry at the same time. Hydropower, transmission infrastructure, solar systems, biomass, oil production and long-term nuclear plans all form part of that wider economic strategy.
Uganda’s Energy Paradox: Renewable Electricity, Traditional Fuel Use
Uganda has one of Africa’s cleaner electricity generation mixes, but electricity represents only part of the country’s total energy use. Hydropower supplies most grid-connected generation, while solar power and electricity from sugar cane waste add smaller amounts. Thermal plants provide backup capacity but are not the foundation of the system.
By the end of 2025, Uganda had approximately 2,098 megawatts of installed electricity generation capacity. Renewable sources accounted for about 95% of the total, including approximately 82% hydropower, 9% bagasse and 4% solar power. The number of grid-connected customers had risen above 2.7 million by early 2026. [1]
These figures suggest that Uganda already has a strong low-carbon power system. The wider reality is more complex. Electricity consumption per person remains low, rural connections are limited, and many connected households cannot afford to use large amounts of power.
Traditional biomass remains the main source of energy for cooking. Wood and charcoal are widely used in homes, restaurants and small businesses. The International Energy Agency reported that around 95% of Ugandan households relied mainly on wood or charcoal for cooking in 2022. This dependence contributes to indoor air pollution, pressure on forests and the time burden of collecting fuel. [2]
Uganda’s central energy challenge is therefore not only to generate more electricity. It must connect more people, improve distribution networks, increase productive demand and make modern energy affordable enough to replace traditional fuels.
The Nile Is the Backbone of Uganda’s Electricity System
The geography of the Nile has shaped Uganda’s electricity system more than any fossil fuel. Water flowing north from Lake Victoria creates several major hydropower sites, especially around Jinja and farther downstream along the Victoria Nile.
Large stations include Nalubaale and Kiira near the source of the Nile, the 250-megawatt Bujagali plant, the 183-megawatt Isimba station and the 600-megawatt Karuma Hydropower Project. Karuma entered commercial operation in 2024 and represented one of the largest increases in generating capacity in Uganda’s history.
Hydropower gives Uganda several advantages. It produces electricity without the continuous fuel imports required by oil- or gas-fired plants. It can support industrial development, reduce generation emissions and allow Uganda to trade electricity with neighboring countries.
However, a hydro-heavy system also creates concentration risk. Electricity output depends on water management, rainfall patterns and the condition of dams, turbines and transmission lines. Flooding, drought and changing water levels can affect operations. Climate resilience is therefore becoming part of Uganda’s energy security planning.
Hydropower projects also have environmental and community effects. Large dams can change river flows, fisheries, land use and local livelihoods. Future projects will need to balance additional generation with stronger environmental assessment and community planning.
Uganda is likely to remain a hydropower country for many years. The goal is not to replace the Nile as the center of the system, but to support it with solar, storage, geothermal exploration and stronger regional electricity connections.
Karuma Has Increased Supply, but the Grid Remains the Bottleneck
Uganda’s electricity problem has gradually shifted from a shortage of generation to a shortage of connections, transmission capacity and affordable demand. New plants have increased the amount of available power, but electricity cannot support development unless it reaches homes, farms, mines and factories.
The transmission network must carry power from large generating stations in northern and eastern Uganda toward Kampala, industrial zones and regional markets. Distribution networks must then reach communities that may be widely separated and far from existing lines.
This is expensive. Uganda has a large rural population, and many settlements have relatively low expected electricity demand. Extending a conventional grid to every community may not be financially practical without public support. Solar home systems and mini-grids are therefore important alongside the national network.
Reliability also varies. Businesses can face outages, voltage problems and delays in receiving new connections. These conditions encourage larger companies to install diesel generators or private solar systems, increasing their costs. Small businesses may simply operate without dependable power.
Uganda has also been reforming electricity distribution. The government-owned Uganda Electricity Distribution Company took control of the main distribution network after the Umeme concession ended in 2025. The success of this change will depend on investment in meters, transformers, maintenance, customer service and loss reduction.
The next stage of Uganda’s electricity development will be judged less by the number of megawatts installed and more by how much electricity is delivered and used. Agro-processing, cold storage, irrigation, manufacturing, electric cooking and digital services can all turn available generation into wider economic growth.
Biomass and Charcoal Remain Uganda’s Largest Everyday Energy Story
The most important energy source in many Ugandan households is not hydropower or oil. It is biomass.
Firewood is common in rural areas, while charcoal is widely traded into Kampala and other growing cities. Charcoal is easier to transport and store than raw wood, making it a major urban cooking fuel. It also supports a large informal economy involving producers, traders, transporters and retailers.
This system provides income and accessible fuel, but it also creates long-term problems. Traditional charcoal production is often inefficient, meaning large amounts of wood are required to produce a smaller amount of usable fuel. Rising urban populations increase demand, placing additional pressure on forests and woodland.
Clean cooking is therefore one of Uganda’s most important energy transition issues. Possible alternatives include liquefied petroleum gas, electric pressure cookers, biogas, ethanol, improved cookstoves and more efficient charcoal production. No single option will work equally well in every part of the country.
Electric cooking could become more attractive as the grid expands, especially because Uganda has renewable generation available. However, households need reliable connections, suitable wiring and tariffs that make cooking affordable. LPG can work well in urban and peri-urban areas, but cylinder costs, refill networks and fuel prices remain barriers.
Agriculture also gives Uganda opportunities to modernize biomass use. Sugar mills already generate electricity from bagasse, the fibrous material left after sugar cane is crushed. Coffee waste, animal manure and other agricultural residues could support biogas or industrial heat projects. The long-term goal is to move away from uncontrolled wood consumption toward more efficient and sustainable bioenergy.
Uganda’s Oil Era Is Taking Shape Around Lake Albert
Oil development is the largest new element in Uganda’s energy economy. Commercial discoveries in the Albertine Graben began in 2006, and the country’s identified petroleum resources are estimated at around 6.5 billion barrels of oil in place.
The main developments are Tilenga, operated by TotalEnergies, and Kingfisher, operated by CNOOC Uganda. Uganda National Oil Company holds the government’s commercial interest in both projects.
Tilenga covers fields north of Lake Albert in the Buliisa and Nwoya districts. It is designed around roughly 400 wells drilled from a smaller number of well pads, with potential peak production of approximately 190,000 barrels per day. Kingfisher lies southeast of Lake Albert and is designed to contribute additional production to the national oil system. [3]
Uganda National Oil Company stated that first oil production and the first export cargo were expected by July 2026. This remains a project target rather than an established production record, and the timing depends on completion and coordination across the fields, processing facilities and export pipeline. [4]
Oil could change Uganda’s economy through export revenue, government income, jobs, supplier development and new infrastructure. It could also support industries linked to engineering, logistics, construction, chemicals and petroleum services.
The economic result will depend on how revenue is managed. Oil income can support roads, electricity, education and industrial investment, but it can also create fiscal dependence and exposure to global price changes. Uganda will need to avoid allowing petroleum revenue to weaken other sectors such as agriculture, tourism and manufacturing.
EACOP Connects a Landlocked Producer to the Indian Ocean
Uganda’s lack of direct sea access is one of the most important geographic facts in its energy sector. Imported petroleum products must travel through neighboring countries, while future crude oil exports require a route to an international port.
The East African Crude Oil Pipeline, commonly called EACOP, is intended to solve the export problem. The pipeline will run approximately 1,443 kilometers from Kabaale near Hoima to the Chongoleani Peninsula near Tanga in Tanzania. About 296 kilometers lie in Uganda and the remaining distance crosses Tanzania. The system is designed for a peak capacity of approximately 246,000 barrels per day. [5]
Uganda’s crude is waxy and must remain above approximately 50 degrees Celsius while moving through the line. EACOP will therefore use electrical heating, pumping stations and monitoring systems along its route. This makes it more technically complex than a standard crude oil pipeline.
The project is economically important because it gives Uganda access to global buyers. It is also controversial. Its route, land requirements and connection to oil production have created debate about compensation, livelihoods, biodiversity and greenhouse gas emissions.
For Uganda, the pipeline is both energy infrastructure and regional diplomacy. Its operation depends on cooperation with Tanzania, international financing, port facilities and long-term crude demand. It also shows how Uganda’s landlocked position shapes the cost and politics of energy development.
Oil Imports and the Planned Uganda Refinery
Uganda is preparing to export crude oil, but it still imports the petroleum products used by motorists, airlines, farms and businesses. Diesel and gasoline demand has increased with population growth, road transport and economic activity.
The country has proposed a refinery at Kabalega Industrial Park near Hoima. The planned facility would process up to 60,000 barrels per day and produce gasoline, diesel, kerosene, fuel oil and LPG. Uganda National Oil Company and Alpha MBM Investments signed an implementation agreement for the project, with construction expected to take several years after the remaining development steps. [6]
A domestic refinery could reduce imports and keep more petroleum value inside Uganda. It could also supply neighboring inland markets such as Rwanda, eastern Democratic Republic of the Congo, Burundi and South Sudan.
The project still faces major commercial questions. Refineries require high investment, reliable crude supply and a stable market for their products. Uganda must also consider how transport electrification, fuel efficiency and global climate policies may affect long-term demand.
The refinery should therefore be understood as a planned part of Uganda’s industrial strategy, not as an operating solution to current fuel imports. Until it is completed, the country will continue to depend heavily on regional ports, pipelines, roads and storage facilities.
Natural Gas in Uganda Is a Supporting Resource, Not a Main Industry
Uganda does not currently have a natural gas industry comparable to those of Tanzania, Mozambique, Algeria or Nigeria. Natural gas makes little direct contribution to the national electricity mix, and Uganda does not operate a large gas pipeline network.
Gas is still relevant because petroleum production around Lake Albert will produce associated gas. Project planners expect some of this gas to be used within oil facilities, processed into LPG or directed toward other domestic applications.
LPG could be particularly important for clean cooking. Greater local supply might reduce transport costs, expand cylinder distribution and offer an alternative to charcoal. The planned refinery is also expected to produce LPG.
However, local production alone will not solve the clean cooking problem. Uganda will need safe cylinders, filling facilities, retail networks, consumer financing and clear quality standards. Families must also be confident that refills will remain available and affordable.
Natural gas is therefore likely to play a supporting role in Uganda rather than becoming the foundation of the power system. Hydropower and other renewables already dominate electricity generation, while the country has no immediate need to build a power sector mainly based on imported gas.
Coal Has Almost No Place in Uganda’s Current Energy Mix
Coal is not a significant part of electricity generation or household energy use in Uganda. The country does not have a large commercial coal-mining industry, major coal-fired power stations or the industrial coal demand found in economies built around steel and heavy manufacturing.
This absence has helped Uganda avoid the difficult coal phaseout debate faced by countries such as South Africa. Uganda does not need to retire a large fleet of coal plants before reducing the emissions of its electricity system.
Coal could theoretically be imported for industrial heat or future manufacturing, but geography makes it unattractive. As a landlocked country, Uganda would need to transport imported coal over long distances from coastal ports. Hydropower, bagasse, solar energy and local biomass are generally more consistent with the country’s available resources.
The greater environmental problem is not coal combustion but inefficient biomass use and the future growth of oil consumption. Uganda’s energy transition must therefore focus on issues that match its own economy rather than copying a transition model designed for coal-dependent countries.
Solar Power, Bagasse and Geothermal Energy Can Reduce Hydropower Risk
Solar energy is one of Uganda’s strongest options for expanding access beyond the main grid. The country receives useful solar radiation throughout the year, and systems can be installed at several scales.
Large solar farms can supply the national grid. Mini-grids can serve trading centers, islands and remote settlements. Solar home systems can provide lighting, phone charging and power for small appliances without waiting for transmission lines. Solar pumps and refrigeration can also support agriculture and health services.
The quality of equipment remains important. Poor installations, weak batteries and substandard imported components can damage public confidence. Stronger technical standards, trained installers and dependable after-sales service are necessary for the market to grow.
Bagasse power already links Uganda’s sugar industry with electricity generation. Sugar factories can burn cane residue to produce steam and power for their own operations, with excess electricity supplied to the grid. This gives agricultural waste an economic use and adds generation close to industrial activity.
Uganda also has possible geothermal resources, especially in western areas connected to the East African Rift system. Geothermal power could provide steady generation that does not depend on rainfall or daylight. Exploration is expensive, however, because developers must confirm underground resources before knowing whether a project will be commercially successful.
Wind power appears less central than solar, hydro or geothermal, although local opportunities may exist. Battery storage is likely to become more important as solar capacity increases and mini-grid systems expand.
Nuclear Energy in Uganda Is an Ambition, Not a Current Power Source
Uganda does not operate a nuclear power plant. Its electricity system remains based on hydropower, bagasse, solar power and a small amount of thermal generation.
The government is nevertheless developing a long-term nuclear energy program. Uganda is working through the International Atomic Energy Agency’s infrastructure process, strengthening its legal framework, assessing possible sites and developing technical skills. Government plans identify nuclear power as a possible source of large-scale electricity for industrialization and future demand growth. [7]
Buyende District has been discussed as a possible location for the first major nuclear project. Uganda has also proposed a nuclear science and technology center at Soroti University, including a research reactor for education, training and applied research.
The scale of Uganda’s nuclear targets is highly ambitious compared with its current electricity system. A single large reactor could equal a major share of the country’s present installed capacity. Before construction, Uganda would need suitable financing, an independent regulator, trained operators, emergency planning, waste arrangements and a grid large enough to manage the plant safely.
Nuclear energy should therefore be treated as a long-term possibility rather than an immediate answer to electricity access. Transmission, distribution, solar systems and productive power use are more urgent needs. Still, nuclear planning shows that Uganda expects future electricity demand to become much larger as manufacturing, transport and cities develop.
Uganda’s Energy Future Depends on Turning Capacity Into Development
Uganda has already built the foundations of a low-carbon electricity system. Hydropower dominates generation, solar and bagasse are growing, and coal has almost no role. The deeper challenge is that modern energy still does not reach or serve much of the population at the level required for economic transformation.
Oil will add a new source of exports and public revenue, but it will also add environmental, financial and governance risks. EACOP and the Lake Albert fields may place Uganda on the global petroleum map, while the refinery could eventually reduce dependence on imported products. These projects will not remove the need to expand electricity access or replace traditional cooking fuels.
The strongest energy strategy for Uganda is not based on one resource. It combines reliable hydropower, stronger transmission, affordable rural connections, solar mini-grids, cleaner cooking, productive electricity use and careful management of petroleum income.
Uganda’s energy future will ultimately be measured by practical results: factories that can operate reliably, farms that can process and refrigerate products, schools and clinics with dependable electricity, and households that no longer depend entirely on firewood and charcoal. The country has significant energy resources. Its larger task is to convert them into broad and lasting development.