The World Bank Group has approved a $1.6 billion financing package for the Regional Energy Transmission, Trade and Decarbonization Program for Eastern Africa (RETRADE-EA), a ten-year initiative designed to improve regional power integration, expand electricity access, and strengthen economic development across Eastern Africa. The program seeks to deliver more affordable, reliable, and cleaner energy by enhancing cross-border electricity trade and cooperation among countries in the region.
The RETRADE-EA program will invest in both energy infrastructure and institutional development to create a more efficient regional electricity market. Key objectives include strengthening cross-border transmission links, improving energy system resilience, integrating countries that remain outside the regional power grid, and supporting the launch of the Eastern Africa Power Pool’s Day-Ahead Market. The initiative will also focus on better regional planning, regulatory harmonization, governance improvements, and increased private sector participation in transmission projects.
The first phase of the program includes the Uganda-Tanzania Interconnector Project, which will receive $250 million in concessional financing from the International Development Association. The project will fund the construction of a high-voltage transmission line linking Uganda and Tanzania, allowing Uganda’s surplus renewable energy resources to reach broader regional markets and improving electricity availability across neighboring countries.
Additional support will be provided to the Eastern Africa Power Pool through a $10 million grant from the International Development Association and a $3.5 million grant from the Energy Sector Management Assistance Program. These resources will strengthen regional market coordination and institutional capacity, helping facilitate more than 5,000 gigawatt-hours of annual cross-border electricity trade by 2031 while deepening market integration and enhancing energy security among member states.
Uganda currently generates more electricity than it consumes domestically, leaving significant hydropower capacity underutilized. To address this, the interconnector project will construct approximately 260 kilometers of 400-kilovolt double-circuit transmission lines connecting Wobulenzi, Masaka, and Mutukula at the Uganda-Tanzania border. The new infrastructure will provide a transfer capacity of 1,000 megawatts and establish a crucial link between Uganda and the wider regional electricity network.
By 2031, the Uganda-Tanzania Interconnector Project is expected to facilitate at least 452 gigawatt-hours of electricity trade annually between the two countries. Across the broader Eastern Africa Power Pool, greater use of Uganda’s clean hydropower is projected to reduce dependence on costly and polluting thermal power generation, preventing an estimated 25.8 million metric tons of carbon dioxide emissions. The initiative is expected to strengthen energy security, lower electricity costs, support economic growth, and advance the region’s long-term decarbonization goals.
