Published on 03/01/2025
Ugandan households and businesses will enjoy a 5.2% cut in electricity tariffs starting January, thanks to the Electricity Regulatory Authority (ERA).
The reduction spans nine consumer categories and is projected to save consumers Shs155 billion by March. The new tariffs will apply in the first quarter of 2025 (January to March 2025).

As per the new tariffs, qualifying domestic consumers will pay Ush 250 per unit for the Lifeline Tariff.
A Lifeline Tariff is a price for a minimal package of units of electricity, helping low-income earners access affordable electricity. It aims to facilitate the electricity consumers in the low socio-economic customer class category to afford the electricity units deemed necessary for basic domestic use.
Customers who consume less than 100 units of electricity in a month qualify for the Lifeline Tariff of Ush 250 for each of the first 15 units consumed in a month.
For domestic tariffs, the cost has been reduced from Ush 796.4 in the fourth quarter of 2024 to now Ush 775.7 per unit for other domestic consumers. This applies to customers who consume more than 100 units of electricity in a month. They will pay Ush 775.7 for each of the first 80 units of electricity.
The commercial tariff has been reduced to Ush 575.2 per unit, from Ush 599.9 charged in quarter four of 2024.
Commercial consumers include supermarkets, welders, and other small enterprises.
The tariff for medium industrial consumers has been reduced from Ush 448.0 to Ush 417.8 per unit and Ush 448.0 to Ush 434.5 per unit for manufacturing and service consumers, respectively.
The tariff for large industrial consumers has been slashed from Ush 378.6 to Ush 351.5 per unit and Ush 378.6 to Ush 367.1 per unit for manufacturing and service consumers, respectively.
The tariff for the extra-large industrial consumers has been reduced from Ush 320.1 per unit of electricity consumed in the previous quarter (Q4 2024) to Ush 299.1 per unit for this quarter (Q1 2025).
The tariff for public amenities has been slashed from Ush 370.0 per unit of electricity consumed in quarter four of 2024 to now Ush 360.0 per unit. This will ensure affordable electricity for public amenities, including hospitals and street lighting.
“These tariffs represent a weighted average reduction of 5.2% compared to the tariffs of Q4 2024, reducing the cost of delivery of electricity services by Ush. 155bn,” said ERA Chairperson Sarah Wasagali Kanaabi.
Lowered electricity tariffs have a significant impact on the economy.
Power tariff reductions pose a direct influence on the cost of doing business, particularly in the commercial and industrial sectors, leading to lower production expenses. This leads to increased competitiveness and profitability for companies, potentially encouraging expansion and attracting investments.
It is worth noting that among the 2021 strategic guidelines and directives issued to ministers as the blueprint for the implementation of the NRM Manifest 2021-2026 was the directive to the Minister of Energy and Mineral Development to reduce the cost of electricity, particularly for manufacturers, to 5 cents per unit.
There have been notable changes in tariffs for quarter 1, 2025, such as the recategorization of industrial tariffs.
“Medium and large industrial categories have been refined to separate manufacturing consumers from service providers. This distinction supports the productive use of electricity and promotes growth in the manufacturing sector, a key driver of Uganda’s socio-economic transformation,” Kanaabi said.
The 2025 Annual Tariff Review was undertaken with various assumptions, such as electricity demand growth.
“Electricity demand is expected to grow at an annual rate of approximately 10.4%, with energy purchased by UETCL (Uganda Electricity Transmission Company Limited) increasing from 6,634.54 GWh in 2024 to 7,327.14 GWh in 2025,” said Kanaabi.
Another consideration was the end of Umeme Limited’s concession. Umeme Limited’s licenses and concession agreement for the distribution and supply of electricity will expire on March 31, 2025, after more than 20 years of doing the job.
ERA also set tariffs based on inflation, exchange rate fluctuations, international fuel prices, and other approved costs. The Uganda Shilling appreciated by 0.7% against the US Dollar, improving from Ush/USD 3,715.82 in Q4 2024 to Ush/USD 3,689.1 by November 29, 2024.
The Authority also considered the commissioning of the Karuma Hydro Power Plant in August 2024. The plant will contribute to the 2025 energy generation mix.
Other considerations included the connection of the West Nile subregion to the national power grid in August 2024, the Bujagali Energy Limited tax waiver, and Umeme Capital Investments.
Investments qualifying for returns in 2025 are valued at USD 25 million, increasing Umeme’s gross investments from USD 675.736 million in 2024 to USD 700.736 million in 2025.