Uganda: Bujagali Energy-08/Bujagali
Former employee of construction contractor
Worker health & safety and compensation
$100m A & C loans (IFC), $115m guarantee (MIGA)
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.
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 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.
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/Bujagali, Bujagali Energy-06/Bujagali.
Status as of September 19, 2022