Despite rapidly increasing impacts of climate change, the adoption of irrigation technologies in Uganda remains limited, with no more than 2% of Ugandan farms irrigating any of their plots. To accelerate commercialization of agriculture and enhance the climate resilience of the country’s agri-food systems, the government of Uganda—through the Ministry of Agriculture, Animal Industry, and Fisheries, and with assistance from the World Bank—is implementing a subsidy program to help Ugandan farmers acquire solar pumps for small-scale irrigation.

Emerging research suggests that solar-powered irrigation, through removing variable costs for petrol or diesel, might result in unsustainable groundwater extraction. However, there is no evidence of this occurring in sub-Saharan Africa. Similarly, while studies indicate that women farmers can substantially benefit and often prefer solar-powered irrigation technologies, it remains unclear if they benefit equitably from subsidy programs supporting such technologies. A further question is if the subsidy program is a viable business model to reach smallholder farmers, who face a host of constraints to accessing advanced irrigation technologies in the region.

To better understand how these issues play out in Uganda, IFPRI, with support from the CGIAR Initiative on NEXUS Gains, is conducting a survey targeting both beneficiaries of the subsidy program and farmers who expressed interest in it but are either still waiting for it or have decided not to pursue the opportunity further.

Under the subsidy program, farmers are required to contribute 25% of the cost of a solar-powered irrigation system and must have access to a reliable water source, such as a stream, lake, well, or borehole. Despite these conditions, the program has received significant attention, with 80,000 applications submitted from 66 of Uganda’s 146 districts. As of December 2024, approximately 4,000 solar-powered irrigation systems have been installed, and interest in the program continues to grow.

Subsidy co-financing and transaction costs favor wealthier farmers and non-farmers

Based on data collected, the 25% co-financing requirements for solar-powered irrigation systems are substantial, ranging from 4 million Ugandan shillings (approximately $1,100) to 14 million Ugandan shillings (around $3,800). Consequently, farmers must identify sources of co-financing, such as family savings, micro-credit, or bank loans.

Poorer farmers face additional disadvantages, as they cannot afford land with existing water access. With rising temperatures and increasing climate change-driven extreme events such as drought, agricultural land with water resources has become a premium asset, often beyond the reach of the average farmer. A further barrier identified was the need to upload all application documents through a phone app, which smallholders found challenging to access and accomplish.

Given the challenges in raising funds from these sources, early beneficiaries tend to be relatively well-off and include members of the elite, including local government officials, land-owning members of Uganda’s diaspora, and businessmen who own land but are not themselves engaged in farming. With the program expanding, it is also starting to reach less well-off farmers.

Solar pumps enhance household water security but limit water sharing among farmers

The subsidized solar pumps were primarily targeted for use in crop production. However, initial survey data show that solar pumps have supported a range of other productive and domestic needs, particularly pumping water for livestock production and household use. These findings suggest that solar pumps have enhanced overall household water security, increasing their overall return over investment.

At the same time, unlike a typical practice in South Asia, none of the surveyed beneficiaries in Uganda currently provide pumped water to other households. This may be due to the specific sizing of the solar irrigation systems, which is tailored to individual farm needs as part of the program. This customization likely limits the capacity for program participants to sell pumped water to other farmers for additional income and spillover effects to farmers who cannot afford a pump. In contrast, in South Asia, many solar-powered pumps are oversized, because subsidy structures favor larger pumps, crowding smaller ones out of the market. As a result, farmers in South Asia are more likely to sell pumped water to neighboring farmers who cannot afford to own a pump.

Additionally, our findings show that farmers who acquired a subsidized solar pump are more likely to engage in high-value fruit and vegetable production, as well as coffee farming.

The way forward for Uganda’s solar-powered pump subsidy scheme

Key informants pointed out that while the 25% co-funding posed a barrier for low-income farmers, this was not the primary bottleneck. Several savings and credit associations in Uganda offer loan options, provided farmers have the necessary documents. The main challenge for poorer farmers, in fact, is the water source requirement. An urgent review of sustainable groundwater systems in Uganda’s farming areas, along with strategies to help farmers access these resources, is needed. Additionally, water sharing options between farmers and improvements to overall water governance systems should also be explored.

Another significant challenge is the lack of solar pump repair services in rural communities. Farmers consistently mentioned this issue, with some reporting that they abandoned their solar pumps because repair services were unavailable. When such services were offered, they were often of poor quality, indicating a lack of expertise in solar-powered systems. The situation was further worsened by the scarcity of spare parts. To address this, the government and technical schools should support training programs for technicians, given the growing number of solar-powered pumps in rural areas. This could also present an opportunity for youth employment.

A third bottleneck is delays in procurement of solar pumps, though these delays are not universal. During the IFPRI survey, some beneficiaries reported to have received the pumps on time—within two to three months after submitting final paperwork—while others waited four to seven months. This might reflect differences in district human capacity or varying levels of remoteness from the main suppliers in Kampala. Delayed deliveries can affect agricultural productivity, particularly if farmers have taken out loans for the unsubsidized portion of the pump cost and must begin repaying it without having generated any income from the pump.

Both the repair services and delivery bottlenecks might be linked to the fact that solar pump providers have no contractual relationship with farmers. They might therefore not consider farmers to be their clients, only the Ministry and its local representatives that administer the subsidy program. Creating incentives for the private sector to provide services to farmers should be considered as the program is being rolled out.

As the program is further scaled up in Uganda and potentially elsewhere, the insights coming out from this NEXUS Gains-supported study can help drive increased equity and sustainability of this important business model.

Edward Kato is a Senior Research Analyst with IFPRI’s Natural Resources and Resilience (NRR) Unit; Claudia Ringler is NRR Director and co-lead of the CGIAR Initiative on NEXUS Gains Initiative; Geoffrey Kiguli, George Sentumbwe, Dennis Tiishekwa, Abdul Nsereko, and Jennifer Alinaitwe are with Homeland Data Services, Uganda. This post is based on research that is not yet peer-reviewed. Opinions are the authors’.

This work was supported by the CGIAR Initiative on NEXUS Gains.