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January 6, 2021,

Annually, Civil Society Organizations (CSOs) in the Environment and Natural Resources (ENR) sub sector organized under their ENR-CSO Network…

Reducing Climate-Induced…

Pig farming is important for income generation…

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Poor govt…

Inadequate government support and limited financing from…

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OVERCOMING THE…

Author: Phillip KIHUMURO, Research Associate, World Agroforestry-…

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Annually, Civil Society Organizations (CSOs) in the Environment and Natural Resources (ENR) sub sector
organized under their ENR-CSO Network actively participate in the in the generation of the Sector
Performance Report for the MWE. This is always done through self-assessment of their contributions to
the sub-sector and an assessment of the government’s performance against the commitments that it set
for itself during the ended financial year 2019/2020. These assessments usually guide stakeholders in
setting the priorities for the Ministry in the new financial year 2020/2021.
Traditionally, outcomes of the self-assessments are presented during the Joint Sector review process
which offers an opportunity for CSOs in the ENR sub-sector to present their annual performance and
contributions to ENR sub-sector during the past year to the stakeholders. The JSR is also a space that
offers an opportunity for CSOs in the ENR sub-sector to engage in influencing the setting of new
priorities on which government’s financial resources are spent. Therefore, this process enhances
accountability of CSOs in the ENR sub-sector and offers an opportunity for them to play an active
representative role (for vulnerable and voiceless rural communities) in national policy processes.
However, due to emergence of COVID 19 Pandemic, the JSR for this year may take a different approach
with the restrictions on public gatherings and meetings in place. Environmental Alert, the Secretariat of
the ENR-CSO Network took a lead role in mobilizing the ENR CSOs to participate in the JSR process by
sharing their collective contributions to the sector during the ended financial year 2019/2020. The
contributions are documented in the MWE Sector Performance Report and in the ENR-CSO Position
paper.

Let us monitor enforcement of innovations such as the “Polluter Pays” principle, the Payment for Ecosystem Services (PES) even before the occurrence of disasters likened to the water surge. Find more of the recommendations on how to address wetland degradation challenges in the ENR-CSOs Consolidated Annual Performance Report, 2019/2020

Pig farming is important for income generation and nutri­tion for a large population in Uganda, with 4.2 million pigs being kept in 2017. However, future projections indicate that domestic pork production will not be sufficient to meet the increasing demand. This situation is likely to be aggravated by climate-induced heat stress. Analysis of historical climate data and simulation of future periods predicts a gradual shift towards more severe heat stress conditions experienced in most parts of the country. Animals experience heat stress when subjected to a se­ries of conditions where the animal’s body is overheating. Pigs are more vulnerable to heat stress because they do not have functioning sweat glands. Heat stress distorts the pigs’ feed intake, growth and reproduction and makes pigs vulnerable to diseases. This, in turn, brings economic losses. In Uganda, smallholder pig production systems -which are the majority- are transitioning towards-  market-oriented models, Details…

Inadequate government support and limited financing from commercial banks, among others, are hindering the private sector from investing in renewable energy, a new report has revealed.

Renewable energy, often referred to as clean energy, comes from natural sources or processes that are constantly replenished such as solar energy and biogas.

Dubbed, ‘Financing Mechanisms for Private Sector Investment in Renewable Energy Access in Uganda,’ the report shows that renewable energy is a profitable venture for investors as well as saving the environment.

However, it indicates that the government does not provide the incentives in form of taxes, electricity subsidies and other sources of financing to attract the private sector to invest in renewable energy sources.

For instance, the report shows that 65 percent of renewable energy companies in Kampala and 85 percent of those upcountry did not know any funding opportunities in Uganda.

“…high and uncertain project development costs, lack of well-defined bankable projects, poor credit profile and financial records, unclear taxation and subsidies, low renewable energy technology sales and fragmented funding landscape and a scattergun approach to private sector support,” reads the report commissioned by civil society body Environmental Alert in partnership with NORAD.

The report is in regard to the project titled, ‘Increasing access to sustainable and renewable energy alternatives in the AlbertineGraben’ that is implemented by World Wide Fund-Uganda.

The report shows that Uganda has found it challenging to utilize many of these renewable energy resources and to ensure the energy mix to accelerate energy access.

“Increasing access to electricity will require a sharp increase in energy access investments. Since public funds are limited, the necessary investments cannot be made by the government alone. Therefore, the mobilization of private investment and finance is crucial,” the report adds.

While launching the report on Friday, Dr Joshua Zake, the Executive Director of Environmental Alert, revealed that apart from inadequate government support, private sector players face higher foreign exchange risks when sourcing international funds and that despite availability of financial instruments to hedge the risk for commonly traded currencies, some borrowers are unwilling to provide the same instrument for currencies traded less frequently.

“The small scale of many renewable energy projects creates significant problems in obtaining international private financing. The sums of finance often required by the projects in their start-up phase are often too small for mainstream investors and banks. The transaction costs of funding many small projects are high because of the due diligence and bureaucracy involved,” he quoted the report, revealing that typical due diligence costs for larger projects can be in the range of $ 0.5 million to $1 million.

Dr Zake however, said that the report, enlists key financing sources that can be tapped to invest in renewable energy by the private sector.

“The report findings and recommendations have helped us to clarify the actions and what duty bearers should do towards the implementation of the study in as far as accessing financing for renewable energy by private sector is concerned,” he said.

In response, Mr John Bosco Tumuhimbise, the Assistant Commissioner in charge of renewable energy at the Energy ministry, admitted that the low level of development and modest contribution of modern renewables are a result of several barriers and challenges which are economic in nature.

“These barriers are financial, fiscal and socio-economic. Investment in renewable energy must compete for resources with other projects whose risks may be lower but also offer better returns on investment. Renewable energy tariffs usually do not factor in other non-monetary benefits such as improved health, reduction in harmful emissions, environmental sustainability and ecosystem services,” he said.

To ensure a steady increase in the contribution of renewable energy sources, Mr Tumuhimbise revealed that government is reviewing the renewable energy policy to address a range of constraints that have hindered the development and adoption of modern renewable energy

The report revealed that financing underdeveloped financial markets, inappropriate financing terms and conditions, limited long-term financing, limited awareness of energy financing opportunities and few well-defined bankable projects are barriers to investment in renewable energy.

“Investments in low-income energy markets like in Uganda are often longer-term, higher risk, and generate a lower financial return. Commercial investors may be unwilling to spend time building the relationships and market demand required to generate a decent return, requiring more ‘patient’ forms of capital instead,” reads the report.

The report shows that many renewable energy projects are too small for mainstream investors, banks; associated with higher risk, lower financial return thereby limiting financing of private sector investment.

Statistics show that despite the recent efforts by the government to increase access to electricity by all Ugandans, more than two-thirds of the population lack access to electricity.

Uganda is among countries with the lowest electricity access rate; over 93% of the population relying on biomass for energy.

Details

Author: Phillip KIHUMURO, Research Associate, World Agroforestry- Member of the Renewable energy CSO Network hosted by Environmental Alert.

Deep down in rural Western Uganda, access to twigs and sticks growing along a neighbours boundary fence, is the difference between a 70-year old and her grandchildren having  lunch or not. A world away, in the semi-urban suburbs of Kiti in Wakiso in Central Uganda, another family has the choice between using charcoal, liquefied petroleum gas (LPG) or an electric hotplate, but mostly uses charcoal to prepare their meals due to the convenience. In both these cases, biomass is very crucial in the provision of their domestic energy needs.

Close to 90% of Uganda’s total primary energy consumption is generated through biomass (77% firewood, 5.6% charcoal and 4.7% from crop residues (MEMD, 2016). The REDD+ strategy for Uganda has identified fuelwood consumption as one of the drivers of deforestation and degradation in Uganda The question is: how can charcoal be produced sustainably to meet this demand without destroying and degrading forests and the environment?

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Jan 18, 2021 - Mon
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