A critical analysis of the legal and policy regime for licensing independent power producers in Uganda

Abstract

The persistent gap between rising electricity demand and stagnant power generation capacity has gained prominence in legal scholarship. Yet, limited attention has been paid to how this disparity may stem from the effectiveness of legal and policy regimes governing the licensing of Independent Power Producers (IPPs), the feasibility of licensing processes, implementation challenges, and potential reforms, including lessons from jurisdictions such as South Africa, Kenya, Tanzania, and the United Kingdom. This gap is particularly evident in Uganda, where demand substantially outpaces supply, but empirical analysis of regulatory and institutional causes remains scarce. This study critically examines Uganda’s IPP licensing regime with five key objectives: assessing its legal and policy framework in terms of (a) efficacy, (b) licensing process feasibility, (c) implementation challenges, (d) remedies and best practices, and (e) proposing recommendations. A mixed-methods research design was adopted, combining qualitative and quantitative approaches to collect and analyse both primary and secondary data. This approach enabled the study to obtain numerical insights into licensing patterns and rich perspectives from stakeholders involved in IPP licensing in Uganda. Primary data were collected via semi-structured face-to-face interviews with seven (7) ERA officials and ten (10) IPP representatives, purposively selected from institutions in Kampala. Data were analysed using directed qualitative content analysis. Secondary data were derived from national, regional, and international legal instruments and similarly analysed through qualitative methods. Findings reveal a mixed level of efficacy in Uganda’s legal and policy regime. While the framework outlines procedural steps for licensing, some elements such as the notification phase require enhancement, particularly via digital public communication channels, as seen in South Africa and the UK. Prequalification requirements are generally adequate but could be improved by including a commercial and economic impact assessment, as practiced in South Africa. Structural inconsistencies, particularly overlapping mandates regarding electricity evacuation guarantees and the licence application invitation process, undermine the institutional independence of the Electricity Regulatory Authority (ERA). Additionally, the licensing timeframe of 180 working days exceeds necessity and could be streamlined to 75 days,