Govt Testifies in Umeme Case

In a rare occurrence, the ministry of Energy and Mineral Development has testified against another government department, the Electricity Regulatory Authority (Era) in a case that has pitted electricity distributor Umeme against its regulator.

The case, which involves modifying Umeme’s license, is before the Electricity Disputes Tribunal, chaired by Charles Okoth-Owor. Last week, Umeme tendered its last piece of evidence, the Electricity Tariff Reduction Report 2009, commonly known as Salim Saleh report, in support of its case and also presented Engineer Henry Badasala Igaga, who testified against Era.

The Salim Saleh report was critical of Umeme’s operations in the country, questioning such issues like its investment. It remains unclear why Umeme is relying on a report that in the first place pins it.

Some people within the industry say Umeme presented the Salim Saleh report to prove how unfair it has been treated in the industry. At the centre of the dispute is the amendment to Umeme’s license, mainly on how the tariff is set, and the inclusion of a reconciliation mechanism if there are variations between the projects of tax and energy purchase, and what is actually paid.

Era’s legal team, led by Dr Joseph Byamugisha, had earlier indicated that they were going to object to the tendering in of the report as evidence on grounds that the minister did not have the powers to appoint the committee and therefore its report would be illegal. Former Energy Minister Hilary Onek appointed the committee.

However, Dr Byamugisha didn’t object to the report being tendered in as evidence but opted to cross-examine the witness, a move that was protested by Umeme’s lawyers led by William Byaruhanga, who argued that since Engineer Igaga was not the author of the report, he could not testify as to the contents of the report.

But the tribunal overruled Umeme’s objection, arguing that the witness should either be withdrawn or own up the report since it is a government document. On cross examination, Igaga said the report was never adopted by the ministry. He also told the tribunal that the ministry of Energy had not implemented the recommendations of the report.

Byamugisha picked out most of the sticky issues the report raised and sought what government had done about those issues. One of the issues he picked was how the report pointed out that Umeme exaggerated its investment in Uganda. Byamugisha asked Igaga whether the ministry had investigated the misreporting of its investment portfolio.

Igaga said government had never investigated the issue of Umeme’s exaggerated investment. The parties are now preparing to make final submissions before the tribunal makes its decision.

Source : The Observer