Bagasse Cogen in Uganda

Bagasse Cogen in
Uganda
Experience of Kakira Sugar Works
Project
Mac Cosgrove-Davies
March 2005

Context: Ugandan Power
Sector
• Sector recently restructured
– Generation – privately operated
– Transmission – publicly owned
– Distribution – privately operated
• Current Generation 280 MW
• Capacity Deficit ~50 MW
• Level of Electrification - ~5% access,
less than 1% rural

gandan Sugar Industry
2004 data)
Capactiy
(Tonnes
Crushed
per Day)
Nucleus
Cane
Outgrower
Cane
Cane
Crushed
Sugar
Produced
No of
Employees
No of
Outgrowers
Kakira Sugar
Works
3500
525
464
989
84
6500
4000
Kinyara Sugar
Works
2000
457
213
670
65
3500
Sugar
Corporation
of Uganda
2500
417
127
544
47
Imports
40
Sugar
Consumption
236
Thousands of tonnes per year unless otherwise noted

Uganda Energy for Rural
Transformation Project
• Three-phase program aimed at
developing Uganda’s s rural energy and
ICT sectors for rural productivity as
well as the quality of life impacts
• Includes support for renewable energy
development, both grid & off-grid
• Fully integrated with Uganda’s s energy
sector restructuring and privatization

Kakira Sugar Mill
Expansion
• Increase in cane crushing
capacity from 2,500 to
4,000 tonnes per day
(annual production capacity
increased from 90,000 to
110,000 tonnes)
• Utilize all surplus bagasse
for power generation
• Existing Boilers: 1+3+3 MW
at 20 Bar
• New Boiler: 16 MW 42bar

Bagasse Cogen Expansion
• Current plan: Increase production from current
4.5 MW, used for internal consumption, to 14
MW, including 6 MW excess for sale to grid
• Initial PPA signed for sale of 6 MW to the grid
• 14 km transmission line 33 kV
• Project Cost ~$20 million
• Due to capacity shortages,
Government requested
increase supply to 12 MW.

Development Timeline
• Initial power purchase discussions
commenced late ’90s
• Discussions gained momentum with
preparation of ERT Project
• PPA signed in July 2003.
• The Subsidy Agreement and
Implementation Agreement signed in
August 2004
• Financial Closure achieved end of, 2004

Implementation
Milestones
• TARGET DATE
MILESTONE
• April 2003
Appointment of Consulting Engineer for detailed engineering
• July 2003
Order turbo-generator
• September 2003
Complete detailed engineering – phase 1 for enquiries
• September 2003
Start civil works for boiler
• December 2003
Start boiler erection
• December 2003
Start civil works for balance of plant
• January 2004
Complete balance detailed engineering – phase 2
• May 2004
Start balance of plant installation
• March 2005
Start turbo generator erection
• June 2005
Start construction of new KSW sub-station station & New Distribution Line
• September 2005
Boiler completion and commissioning
• November 2005
Complete turbo-generator installation
• February 2006
Complete balance of plant installation
• April 2006
Complete construction of sub-station station and Distribution Line
• May 2006
Interconnection of New Facilities with existing KSW Sugar factory
• May 2006
Commence testing of Generation Distribution Line
• June 2006
Commissioning of Generation Facilities and Distribution Line
• Scheduled Commercial Operation Date 30-June-2006

PPA Terms
• Power purchase:
– Contracted capacity: 6MW
between 18:00 – 24:00, w/
ramp up and down
– Energy Price
• $US 0.049 (years 1-8) 1
• $US 0.040 (min.) for
years 9-159
– Provisions for Additional
Energy and Emergency
Energy at prices to be
agreed

Lessons Learned
• Private firm - Kakira Sugar Works - highly capable
to undertake project preparation and
implementation
• Power purchase agreement a major issue:
– Sector reform did not account for small power producers
– Grid needed only peaking power, although cogen
capability is much broader
– First-of
of-a-kind PPA requires capacity building for all parties
– Multi-year negotiation required seller with ‘staying power’