KAMPALA | Monday, June 2, 2025 — Umeme Limited has significantly increased its compensation claim against the Government of Uganda to UGX 1.1 trillion (approximately USD 292 million), intensifying a long-standing dispute over the final payout owed following the end of its electricity distribution concession.
In a public statement issued on Monday, the electricity distributor confirmed that while recent negotiations had resolved some aspects of the claim, substantial differences remain unresolved.
The revised figure—USD 292 million—now stands well above the USD 118 million already paid by the government. That amount had been calculated based on an assessment by the Auditor General.
“While discussions led to agreements on certain items, there was no resolution on the full outstanding claim, which currently stands at USD 292 million beyond the previously settled USD 118 million,” the company announced.
Umeme’s original claim was USD 234 million, but after a government audit, the agreed compensation was lowered to USD 118,385,603, which has since been paid in full.
The company says the higher claim reflects newly reconciled infrastructure investments. It also noted that the Auditor General is still reviewing its capital expenditures for 2025, which could lead to adjustments in the final amount.
With talks at an impasse, Umeme stated it will proceed with international arbitration in London, as provided under the terms of the concession agreement.
“The formal arbitration notice will be served to the Government shortly,” the company noted.
Concession Expiry
The dispute arises from the government’s decision not to renew Umeme’s 20-year electricity distribution concession, which officially ended in February 2025. According to the concession terms, the government must compensate the company for any unrecovered investments made over the life of the contract.
Meanwhile, the Uganda Securities Exchange (USE) has extended its suspension of trading in Umeme shares until June 12, 2025, citing the ongoing dispute and its impact on investor confidence. The company has also received approval to delay the release of its 2024 audited financial results, which are now expected on the same date.
The widening gap between Umeme’s claim and the government’s position sets the stage for a potentially lengthy and costly legal process. The outcome is likely to have far-reaching implications for investor sentiment and the future structure of public-private partnerships in Uganda’s infrastructure sector.