Vidullanka commissions Muvumbe Small Hydro Power Plant in Uganda

Vidullanka PLC, one of the key players in Sri Lanka’s renewable energy industry commissioned its ninth Small Hydro Power Plant (SHPP) in Uganda on 18 March. The Muvumbe SHPP, a 6.5 MW run of the river based small hydro power project utilises the flow of the Nyakizumba River and is expected to generate and supply 31.4GWh of electricity per annum to the national grid of Uganda.

The project potential was identified back in 2012 by a team of Vidullanka’s engineers and subsequently the Muvumbe Hydro (U) Ltd. was incorporated, as a wholly owned subsidiary of Vidullanka PLC to undertake the investment. In supporting the investment project finance and IBU units of the two premier Sri Lankan commercial banks, namely HNB Bank PLC and Bank of Ceylon teamed up to finance the project investment through a syndicated facility. The Exchange Control Department of Central Bank of Sri Lanka was supportive of this overseas investment considering the long term benefits to the country, which stands to bring in a substantial amount of foreign exchange over the following years.  

The company obtained all the necessary approvals from the Uganda Authorities before the construction, which was ceremoniously commenced by the Prime Minister of Uganda Dr. Ruhakana Rugunda on 21 September 2015. 

The project company, Muvumbe Hydro (U) Ltd. has a 20 year Power Purchase Agreement with Uganda Electricity Generation and Transmission Company Ltd. (UETCL) along with the Implementation Agreement with Ministry of Energy and Mineral Development, Uganda. The project was implemented in accordance with the International Finance Corporation Performance Standards on the environment and social sustainability and was monitored by the Electricity Regulatory Authority Uganda, National Environmental Management Authority of Uganda and the GETFiT Secretariat.

In addition to the supply of environmentally friendly electricity, the Muvumbe has teamed up with an NGO named AICM, to carry out a series of social wellness initiatives with the objective of improving the livelihoods of the local population. The company has also constructed and delivered a community health centre in Kigrama, and built five road bridges in Maziba county as part of its corporate social responsibility.

The project was well received by the stakeholders, especially the local communities and the government of Uganda, both welcomed the project for the creation of employment opportunities in the rural area during the construction of the project and the sustainable solution to the electricity demand. The project is also entitled to the GETFiT grant administered by the KfW Development Bank of Germany, which enhances the tariff paid by the UETCL. The Muvumbe SHPP marks a milestone for the GETFiT program by becoming the first hydro power project to get commissioned to the national grid of Uganda under the program. 

The project also marks an instance where the Sri Lankan Engineers transferred their wealth of technical excellence gained in Sri Lanka to another developing country for the betterment and the upliftment of its rural populace. It is also noteworthy of mentioning that the design and project management, construction of civil structures and electromechanical installations were performed by companies based in Sri Lanka. The control panels of the project were designed and assembled in Sri Lanka by Vidullanka engineers and exported to Uganda and the Civil construction was undertaken by Sanken Construction and Karunathilake Construction through their overseas ventures. These stand as a proof that Sri Lankan engineers’ technical know-how regarding the small hydro power industry is indeed of world-class.

With the commissioning of the Muvumbe small hydro power project in Uganda, Vidullanka PLC owns and operates an installed capacity of 23.85 MW small hydro power plants; nearly triple the size of its capacity of 7 MW at the end of  year 2011. The company is also in the process of constructing its 10th small hydro power plant in Badulla, which is expected to be commissioned during Q2 in FY 2017/18.