28th September 2023
Uganda: Kalangala Infrastructure Services I & II
Making connections for a brighter future
Challenge
Bugala Island, situated on Lake Victoria in Uganda’s Kalangala District, has undergone a transformation over the past decade. Previously one of Uganda’s poorest districts, residents of Bugala Island lacked safe regular access to the mainland, reliable electricity and clean water.
This had constrained the growth of agriculture and fishing activities on the island and prevented the realisation of its tourism potential. In 2005, InfraCo Africa began to address these constraints and established an infrastructure company, Kalangala Infrastructure Services (KIS). Today, the island is thriving and Kalangala is among Uganda’s wealthiest regions. KIS has played a major role in this transformation.
Overview
Solution
KIS is a pioneering mixed utility company that has responded to the complexity of Bugala Island’s needs. KIS has delivered and now operates two modern roll-on roll-off ferries; has upgraded the island’s 66km Luuku – Mulabana main road; is distributing clean water to 19 villages on the island; and has developed 1.6MW of hybrid solar-diesel power and recently taken over operation of the Kalangala Town Council (KTC) grid.
In 2005, the residents of Bugala Island approached InfraCo Africa to ask for help in refurbishing and developing their infrastructure. The complexity inherent to multi-sector small-scale island infrastructure had deterred the private sector and required significant expertise to balance commercial viability and affordability. InfraCo Africa led the design and development of the Kalangala project.
Working with the Ugandan government, InfraCo Africa negotiated a tolling scheme for the ferries and addressed the legal and regulatory challenges associated with establishing the first private mixed utility in Uganda. DG OBA grant of US$5m, InfraCo Africa enabled the launch of the first ferry and so build confidence and engagement in the project. InfraCo Africa also designed an innovative project financing package which blended various financing instruments and mobilised support from its sister PIDG companies.
Today, all four components of the project are fully operational and KIS has defined an ambitious vision for the future. Solar power could be scaled-up by 300% and distribution and electrification expanded.
Funding has been provided by the Industrial Development Corporation, Uganda Development Corporation, Emerging Africa Infrastructure Fund, Nedbank and TA. InfraCo Africa has maintained its interest in KIS and remain committed to its future development.
