Uganda-South Sudan $358M Power Line Deal Unlocks Regional Energy Trade Opportunities
Uganda’s government announced on September 16, 2025, a $358 million loan agreement from regional and private lenders to finance a high-voltage power grid interconnection with South Sudan, a 138-kilometer transmission line that will enable Kampala to export surplus electricity and catalyze a $500 million surge in regional energy trade. The project, involving upgrades to Karuma and Olwiyo substations and a new facility near the border, positions Uganda as a key energy supplier in East Africa, leveraging its post-Karuma dam capacity to power South Sudan’s industrial growth.
The deal, sourced from the African Development Fund, Arab Bank for Development in Africa, and Standard Chartered Bank, supports Uganda’s pivot from domestic focus to export-oriented enterprise. With the 600 MW Karuma hydropower station operational since 2024, Uganda generates 1,000 MW surplus, enough to meet South Sudan’s 300 MW demand. Junior Finance Minister Henry Musasizi highlighted the commercial potential, stating, “This line isn’t just infrastructure—it’s a trade corridor for Uganda’s builders to energize neighboring markets.”
The interconnection will extend to Juba with South Sudanese lines, creating a 400 kV network for 500 MW transfers. This builds on Uganda’s $1.7 billion Karuma investment, which has stabilized local supply and opened export avenues. Enterprise players like Sinohydro, the Chinese firm in talks for construction, stand to gain from $200 million in contracts, while Ugandan firms in substation tech could secure 30% local content deals.
The project intensifies East Africa’s energy enterprise competition. Kenya’s Lake Turkana wind farm exports 310 MW to Ethiopia, but Uganda’s hydro advantage—lower costs at $0.04/kWh—gives it an edge. South Sudan’s oil-dependent economy, with $2 billion exports, will benefit from reliable power for refineries, reducing diesel imports by 20%. As Musasizi noted, “Uganda’s surplus is South Sudan’s opportunity for industrial takeoff.”
The line’s execution will create 1,500 construction jobs and 300 ongoing roles, while spurring ancillary enterprise in transmission maintenance. Uganda’s manufacturing sector, 8% of GDP, could export $100 million in power-related equipment, fostering a collaborative ecosystem.Uganda’s $358 million deal is a masterstroke of enterprise, turning energy surplus into regional dominance.
