Uganda: Bujagali Energy-08/Bujagali

Date Filed
06 Jun 2017
Status
Open
Phase
Compliance
Country
Uganda

Case Tracker

Eligibility
Eligibility
Assessment
Transferred
Assessment
Dispute Resolution
Compliance
Appraisal
Investigation
Monitoring
Third monitoring report issued in September, 2022. Case remains open.
CURRENT Status
Monitoring (COMPLIANCE)
Third monitoring report issued in September, 2022. Case remains open.

Complaint Overview

Complainant

Former employee of construction contractor

Concerns

Worker health & safety and compensation

Cross-Cutting Issues
Labor Community Health and Safety IFC/MIGA Due Diligence IFC/MIGA Supervision

Project Information

Region
Africa
Institution
IFC/MIGA
Name & Number
Bujagali Energy Ltd 24408 (IFC) & 6732 (MIGA)
Company
Bujagali Energy (IFC); World Power Holdings (MIGA)
Sector
Infrastructure
Department
Infrastructure
Category
A
Commitment

$100m A & C loans (IFC), $115m guarantee (MIGA)

Synopsis

Project Overview

The Bujagali Energy project comprises the development, construction, and maintenance of a run-of-the-river power plant with a capacity of up to 250 MW on the River Nile in Uganda. Bujagali Energy Ltd. also managed the construction of approximately 100 kilometers of 132 kV transmission line on behalf of the Uganda Electricity Transmission Company Ltd. to improve the transfer of electricity from the plant.

Bujagali Energy Ltd is a Public Private Partnership owned by Industrial Promotion Services (Kenya) Ltd., the industrial development arm of the Aga Khan Fund for Economic Development, and SG Bujagali Holdings, Ltd., an affiliate of Sithe Global Power LLC (US). IFC (#24408 and #33022) and MIGA (#6732) are supporting the $750 million project along with several other international financial institutions, including the International Development Association, African Development Bank, and European Investment Bank. IFC’s investment comprises $130 million in A and C loans, and MIGA issued a $115 million guarantee to World Power Holdings Luxembourg S.à.r.l., a subsidiary of Sithe Global Power, for its investment in the project.

Complaint

The complaint was submitted to CAO in June 2017 by a former employee of the former construction contractor, Salini Costruttori. The complainant claims that in 2009, during the time he was employed at the project site, he suffered an injury that caused him severe chronic backache, for which he has not received any compensation.

CAO Action

CAO found the Bujagali Energy-08 complaint eligible for further assessment in July 2017 and conducted an assessment of the complaint. In March 2018, CAO completed the assessment. While the complainant had expressed an interest in participating in a dispute resolution process, the company declined to participate due to reasons that are reported in the CAO Assessment Report. Therefore, in accordance with CAO’s Operational Guidelines, the case was referred to CAO’s compliance function for appraisal of IFC and MIGA’s due diligence.

CAO’s compliance appraisal found the Bujagali Energy-08 complaint to be similar in substance to a March 2011 complaint (Bujagali Energy-04) from workers who were injured while working on the construction of the project for the same Engineering, Procurement & Construction (EPC) contractor. The earlier case led to a CAO compliance investigation (also concerning the Bujagali Energy-06 case) that was publicly released in December 2017. Considering that CAO already looked into IFC’s analysis of the worker’s compensation structure and safety supervision during its investigation related to the Bujagali Energy-04 and Bujagali Energy-06 complaints, CAO determined that no investigation on this matter is merited at this time and decided to merge this case with the Bujagali Energy-04 and Bujagali Energy-06 cases for the purpose of monitoring. 

In March 2019, CAO published a monitoring report of IFC/MIGA’s response to the Bujagali Energy- 04, 06, 07, and 08 cases.  In response to the issues raised in the Bujagali Energy 04 & 08 complaints, CAO’s ongoing monitoring would review the outcomes of IFC’s scoping process once available. 

In May 2020, CAO published its second monitoring report of IFC and MIGA’s response to the Bujagali Energy 04, 06, 07, and 08 cases. Since the first monitoring report, IFC completed its scoping report which included recommendations for possible additional support to injured workers. The report also identified local institutional capacity to support disabled workers and ongoing client community support programs that can be accessed by this group. 

In September 2022, CAO issued a third monitoring report. It analyzes whether IFC has adequately addressed CAO’s non-compliance findings, building on CAO’s two earlier monitoring reports issued in February 2019 and May 2020. 

IFC is initiating an Advisory Services program to support skills and capacity development for some workers injured during project construction. This action, once implemented, should partially address CAO’s findings in relation to the impacts of the project on injured workers. However, the remaining non-compliances identified by CAO and associated impacts on workers remain substantively unaddressed, including for dependents of workers who were killed.

All documents relating to this case are available under "Case Documents" section.

 

Status

CAO published the third monitoring report in September 2022, and it is available in the “Case Documents” section.

Given that the Bujagali hydropower project is an active IFC project that remains in material non-compliance with IFC’s environmental and social requirements, CAO will keep these cases open in monitoring. See related cases:

Uganda: Bujagali Energy-04/Bujagali, Bujagali Energy-07/BujagaliBujagali Energy-06/Bujagali.

Status as of September 19, 2022

 

Case Documents

  • Complaint & Assessment

    Complaint
    Letter of complaint
    Jun 06, 2017
    English
    Letter of complaint
    Assessment Report(s)
    CAO Assessment Report - Bujagali-08
    Mar 01, 2018
    English
    CAO Assessment Report - Bujagali-08
    IFC Response to CAO Assessment Report
    Mar 08, 2018
    English
    IFC Response to CAO Assessment Report
    MIGA Response to CAO Assessment Report
    Mar 06, 2018
    English
    MIGA Response to CAO Assessment Report
  • Appraisal Report(s)
    Appraisal of IFC investment in Bujagali Energy
    Apr 12, 2018
    English
    Appraisal of IFC investment in Bujagali Energy
    Monitoring Report(s)
    CAO Monitoring Report of IFC/MIGA
    Feb 27, 2019
    English
    CAO Monitoring Report of IFC/MIGA
    IFC Response to CAO Monitoring Report of IFC's
    May 24, 2019
    English
    IFC Response to CAO Monitoring Report of IFC's
    Second CAO Monitoring Report of IFC/MIGA
    May 01, 2020
    English
    Second CAO Monitoring Report of IFC/MIGA
    Second CAO Monitoring Report of IFC/MIGA
    Jun 01, 2020
    English
    Second CAO Monitoring Report of IFC/MIGA
    Third CAO Monitoring Report of IFC/MIGA
    Sep 14, 2022
    English
    Third CAO Monitoring Report of IFC/MIGA