President Yoweri Museveni has tasked members
of parliament to pass the bill on bio-fuels by the end of the year. In February Museveni commissioned a $35
million (€31.6m) bio- Ethanol power plant and distillery at Madhavani Group’s
Kakira Sugar Works Ltd, in eastern Uganda .The plant has capacity to produce 32
million litres of ethanol fuel using the 74,000 tonnes of molasses a byproduct
from the sugar production process.Speaking during the commissioning, Mr
Museveni said the bill would be “expedited” to ensure that it’s in place within
six months.
Should the legislation be passed as
per the president’s set deadline, companies currently developing Uganda’s vast
oil reserves will be compelled to mix their fuel products with at least 10% of
the ethanol manufactured at Kakira sugar Ltd.The measure is expected to extend the
life span of Uganda’s oil reserves, currently estimated at 6.5 billion barrels,
in addition to lowering the pump price of fuel in the country.
According to the Joint Managing
Director of Kakira Sugar Limited, Mr. Mayur Madhavani, the ethanol distillery,
which commenced operations in November last year ,is already producing Kakira's
Extra Neutral Alcohol ENA for use in the
beverages industry, and as a sanitizer in hospitals.
Uganda Breweries Limited UBL, a unit
of UK brewer, Diageo Group are already using the ethanol to produce Uganda
Waragi a popular local gin and a whole range of whiskies and spirits.
Previously, Ugandan brewers would import ENA from South Africa and Mauritius
but have since taken on Kakira as its leading supplier. For a country plagued
with an ever widening trade deficit, it’s a welcome relief, analysts say.
“If the bill comes into law and the nation
adopts use of biofuels we are definitely going to see lots of benefits. Farmers
will have many more crops that they can plant as sources of money and more job
opportunities,” says Mr. Mayur
The bill which was tabled before
Parliament by the energy ministry in December 2016 has been slow to pass. Under
the parliamentary rules of procedure, once the minister has introduced the bill
and it is considered read, as was the case in December, the bill is sent to the
responsible committee to scrutinize it over a 45 days period before sending a
final report back to Parliament for the second reading which is in this case is
meant to be presided over by the minister of Energy. The 45 days have since
elapsed without progress on the bill, prompting the president, who would
nautically have the final say in the law to intervene.
Although Uganda already has policies
in place, such as the Renewable Energy Policy 2007 and Energy policy 2002
respectively, which provide for the blending of biofuels such as ethanol with
fossil fuels like diesel and petrol in regulated proportions, the oil companies
have not shown strong enthusiasm to prepare for blending of the fuels when
products are available.
Thus the need to provide a legal
framework to compel the petroleum and oil marketing firms to not only carry out
blending, but also regulate such blending by spelling out the ratios that would
be followed.At 6.5 billion barrels Uganda’s oil
reserves are the largest undeveloped reserves in the region and with blending,
the life span can be extended by a further 10 years, from the current estimate
of 50 years, says Irene Muloni, Uganda’s energy and minerals minister.
“The oil we have in the ground is finite; we
have to devise ways of prolonging its lifespan for the benefit of our people,”
she says “Blending is one of those smart ways”
According to Frank Tumwebaze the
minister of information and national guidance,the biofuels law is also, meant
to enhance investment in the sector. Lack of a legal framework impedes
investments in the biofuels production sector.
“Project developers in the field of
biofuels require a secure market which has to be developed through legislation
for them to invest in the sector”
“Legislation will enable the
developers to access long term finance which is required in the biofuels
industry, In addition, Legislation will create other incentives like tax
rebates which will encourage investors to develop biofuels,” he says .Other than
sugar cane, the avenues are enormous, including possible production from corn
and other plants that are grown widely in the East African nation, which also
grows more bananas than any other country in Africa.
It is also envisaged that the biofuels law once
in place will enhance mass production of biofuels crops such as maize, soya
bean and sugarcane from which biofuels are made, and also lead to value
addition through agro-processing and marketing, which would in turn increase
rural earnings and open up employment opportunities in rural areas.
Government of Uganda is also committed to
reducing greenhouse gas emissions and contribute to the global fight against
climate change. Biofuels production and utilization provides a cleaner and
environmentally friendly fuel for industrial purposes, cooking, transport and
power generation.
In Uganda, only 10% of the population
have access to clean energy and even less than 5% in rural areas according to
statistics from the energy ministry. This has left many people cutting down
trees for either charcoal or wood fuel.
It is estimated that Uganda annually
loses about 100,000 hectares of forest cover to charcoal burners and firewood
sellers. Figures from the 2014 Uganda Population and Housing Census indicate
that 340,000 households in the capital Kampala alone rely on either charcoal or
firewood or both. The production and use of biofuels is meant to help reduce
this number.
It is further envisaged that biofuels
production will reduce Uganda's dependence on petroleum products and also save
Uganda valuable foreign exchange. Uganda continues to spend colossal sums on
importation of petroleum products. Figures from Bank of Uganda show that in
2016 Uganda spent $3.7 billion on the importation of fuel.Other than sugarcane, a number of
other agro fuel crops are being encouraged to ramp up production. These include
maize, candlenut tree, Croton and Jatropha.
But activists warn that the law will
enhance massive production of biofuels which could replace food crops and bring
about hunger crisis in the country.Samuel Okulony the programme officer of
renewable energy at Africa Institute for Energy Governance, a local Ngo, says
that curbing fuel shortages is good for Uganda’s development, but biofuels
projects should not compete for land with food crops. He warns that this could
threaten food security.
“There is need for an all-inclusive
dialogue involving all stakeholders and then a well thought-out law is passed
to guide the development of the nascent industry” he says. “Otherwise,
emphasizing biofuels alone does not create a win-win situation for our farmers.
To be sure, in neighboring Kenya,
growing cultivation of a popular bio crop, Croton is already sending shockwaves
in the hunger prone nation. Although the plant has been hailed as a game
changer in the biofuel industry, some experts say it’s over cultivation poses
one grave danger to food production, in a country that hosts more hungry people
than any other in East Africa.
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