Kalangala Infrastructure

Uganda

eleQtra developed and managed a multi-sector utility to provide environmentally sensitive infrastructure services,

to serve island residents with improved access to water, safer transportation and more reliable electricity.

The Kalangala Infrastructure Services Project (KIS) is comprised of the construction, operation and maintenance of two roll-on roll-off passenger and vehicle ferries (the first ferry service was launched in 2012 and the second ferry came into service in 2014), the upgrade of the island’s 66km main road from a dirt road to a gravel road (completed in December 2015), a series of solar-powered pump based water supply systems and a town water reticulation (the operations of which started in 2016) and a 1.6 MW (nominal) power generation system, 33kv transmission system, low voltage distribution system and the installation of a prepaid metering system (which started operation in 2015). The four components were integrated in to a commercial enterprise to achieve the desired economies of scope and scale.

The Project was financed by a combination of equity capital from the Industrial Development Corporation of South Africa (“IDC”) Uganda Development Company (“UDC”), InfraCo Africa (“InfraCo”) and a contractual ownership interest held by eleQtra, commercial debt underwritten by Nedbank Capital Ltd and a grant from the Private Infrastructure Development Group (“PIDG”). The commercial debt benefited from a credit guarantee issued by USDAID (under the Development Credit Authority) and GuarantCo Limited (GuarantCo).

InfraCo Africa Project Case Study Kalangala

Primary Economic Benefits

  • The objectives of the Project were to develop new and rehabilitate existing infrastructure in order to satisfy the growing and unmet demand for infrastructure services for the population and establishments of the Island.
  • This growth in demand had been accelerated and multiplied by the economic activities resulting from development by Bidco Oil Palm Limited of a 10,000 hectares oil palm plantation and related mill facilities.
  • The Bugala fishing industry supplies approximately 7% of the fish catch in Uganda.  This was based on the Island being without any basic infrastructure to support those economic activities. As a result of KIS, the fishing community has now improved beach management units, quicker access to fish processing facilities and refrigeration (cold storage; ice production) due to the project’s transportation enhancement, access to information and markets, and availability of clean water for local fish processing.

Primary Social Benefits

  • The long term effects of the Project has been the creation of 60 jobss, of which 35 are skilled.
  • KIS has trained over 20 apprentices for deck hands, masters and engineers in cooperation with the Dar es Salaam Maritime Institute (DMI) in Tanzania.  Most of the trainees were recruited directly from Bugala Island to foster local training and skills, and include two women, with one now trained in navigation and the other in engineering.

Project Structure

  • This project has contributed to a number of unique improvements in the regulatory environment.
  • KIS is the first private sector water authority in Uganda.
  • KIS is the first private firm in Uganda to be granted a license to own and operate a commercial ferry service.
  • The shadow toll payment structure established by KIS serves as an example of how the private sector may develop and finance road development in Uganda in absence of toll roads.

Project Relevance

  • Nationally, true potable water service is low especially in peri-urban and rural areas (55% rural coverage for potable water).
  • Out of 170,000 km of roads, only 23% are paved. Hence, this project explicitly addresses national commitments to infrastructure coverage.  Although the Main Island Road will be Gravel B, its engineering is a precursor to that which is needed for future paving.

Kalangala Infrastructure

Uganda

Sponsoring government ministries

Ministry of Finance Planning and Economic Development

Approximate scope of project

Cost: US$ 45 million
Construction: 2012
Time:
First Ferry In-Service: August 2012
• Second Ferry In-Service: 2014
• Power Supply System: December 2015
Main Island Road – Completed in March 2016
• Water Supply System: Completed March 2016

Partners

The Industrial Development Corporation of South Africa (IDC)
Nedbank Capital Ltd
Emerging Africa Infrastructure Fund
USAid
GuarantCo
Private Infrastructure Development Group (PIDG)
eleQtra Limited

Developer In Charge

Gad Cohen

Kalangala Project Video 2012

eleQtra is working to develop environmentally sensitive infrastructure services to serve island residents with improved access to water, safer transportation and more reliable electricity. USAid, a project partner produced the project video.

Kalangala Documentary Video 2010

An eleQtra video outlining the social and economic benefits the island residents expect the implementation of the four part infrastructure project will bring to their district community.