Uganda parliament’s decision to conduct an audit into financial abuse in the energy sector could result in an increase in demands to scrap the government subsidy given to thermal power generation companies.

Benon Mutambi, executive director of the Electricity Regulatory Authority (ERA), said the subsidy payments had reached $115.3m, less than one year after the World Bank’s International Development Agency’s $212m loan was exhausted in October 2010.

The government has been providing an annual subsidy of $35.4m for the past seven years in addition to the loan.

Aston Kajara, minister in charge of investment in Uganda, said that the electricity subsidy was too high, and that consumers should “either foot the bill or stay in darkness”.

The Kampala Central MP Muhammad Nsereko, who moved the motion to conduct an audit into abuse in the energy sector, said parliament needs to investigate the inconsistencies in the amount of energy supplied.

For more Policy & Regulation news click here.