Domestic electricity customers in Uganda often wonder why they receive different numbers of units for the same amount of money. The Electricity Regulatory Authority has outlined three factors that explain this variation.
Energy charges
The standard rate for electricity consumption for domestic consumers stands at Shs756.2 per unit for the fourth quarter of 2025 (October to December). However, two special tariffs modify this base rate for eligible customers.
Lifeline tariff
Households with low electricity consumption qualify for subsidised electricity through the lifeline tariff. Customers whose average monthly consumption over the previous six months does not exceed 100 units receive their first 15 units at Shs250 per unit. Once their average consumption exceeds 100 units over a six-month period, customers lose access to this rate.
Cooking tariff
The cooking tariff, introduced to encourage electrical cooking, provides a discount on higher consumption. After purchasing 80 units in a month, customers receive a bundle of 70 units (units 81 to 150), charged at Shs412 per unit. Customers can benefit from both the lifeline tariff and the cooking discount, receiving up to 20 units at the reduced cooking rate.
Non-energy charges
Two additional charges apply to all domestic electricity purchases.
A service charge of Ush3,360 applies to the first purchase made in each billing cycle. This one-off monthly fee encourages efficient use of electricity. If a customer makes no purchases in a given month, the service charge accrues and is deducted from the next payment.
Secondly, value added tax of 18 per cent is levied on every electricity transaction, as electricity provision is classified as a service under Uganda’s VAT Act.
Why units vary
The three factors that cause variation in units received are:
Fixed service charge: The first purchase each month includes the Shs3,360 service charge plus any arrears, which reduces the number of units received compared to subsequent purchases in the same month.
Lifeline tariff: Eligible customers receive their first 15 units at Shs250, with units 16 to 80 charged at the standard rate. This tiered pricing means the number of units received changes as consumption increases.
Cooking discount: Non-lifeline customers receive units 81 to 150 at the reduced rate of Shs412, further affecting the unit calculation.
Timing of purchases
Contrary to common belief, customers receive the same benefits regardless of when they purchase electricity during the month. Both the lifeline tariff and cooking discount apply whether units are bought at the start, middle or end of the [one month] billing period.
All ERA-approved charges are exclusive of taxes imposed under Ugandan law.
Contrary to common belief, customers receive the same benefits regardless of when they purchase electricity during the month. Both the lifeline tariff and cooking discount apply whether units are bought at the start, middle or end of the [one month] billing period.
All ERA-approved charges are exclusive of taxes imposed under Ugandan law.
A practical example
To illustrate how these tariffs work in practice, consider a typical prepaid electricity purchase made on 3 November 2025. The customer paid Shs12,000 via agent banking, with Shs1,200 deducted as agent fees, leaving Shs10,200 available for the electricity purchase.
Transaction breakdown:
| Item | Calculation | Amount (Ush) |
|---|---|---|
| Rounding Adjustment (Previous period) | -89.15 | |
| Rounding Adjustment | 25.49 | |
| Prepaid Electricity Charge | 15kWh × 250 | 3,750.00 |
| Prepaid Electricity Charge | 2.1kWh × 756.2 | 1,588.02 |
| VAT | 8,698.02 × 0.18 | 1,565.64 |
| Service Charge | 1 × 3360 | 3,360.00 |
| Total units received | 17.1 kWh |
The receipt shows how the lifeline tariff applied to the first 15 units at Shs250 per unit, with additional units charged at the standard rate of Shs756.2. The monthly service charge and 18 per cent VAT were then applied, resulting in 17.1 units credited to the meter from the Shs10,200 payment.
For more information on electricity tariffs, visit www.era.go.ug
