AES Nile Power has awarded engineering procurement contracts to five Norwegian companies as part of its planned construction of the Bujagali Hydroelectric Dam in southeastern Uganda. Contracts worth about $320m have been awarded to Viedekke International AS, Alstom Power AS, GE Hydro AS, Skanska International and Norplan.

The planned 250 MW hydroelectric power station is being financed and built by a subsidiary of Virginia-based AES Corporation. World Bank approval for construction was given last month.

The latest contracts are for the period of construction over the following 44 months.

The Dam and power station are being built to meet growing demand for electricity in Uganda where only three per cent of the population has access to electricity and where power cuts are a daily occurrence. AES Nile has a Power Purchase Agreement with the Uganda Electricity Board backed by the government.

At 3.9 cents per kWh (1999$ net generation), the Bujagali hydro facility will produce some of the lowest cost power in the Sub Saharan African region. Uganda’s neighbours produce power at costs exceeding 8 cents (Kenya 8.6 cents, Tanzania US cents).

The project has sparked controversy and during construction over 100 households will have to be relocated.