14 December 2017

Kenya: ERC to Lower LPG Products Prices By Half to Encourage Uptake

Nairobi — ERC says that plans are in place to lower the price of liquefied petroleum gas (LPG) by half price to encourage the consumption of LPG products which are environment-friendly and more effective.

ERC's Director General Robert Pavel Oimeke says Kenya currently lags behind in LPG consumption at 151 metric tonnes, equivalent to 3kg per capita, which is quite low compared to other countries such as Senegal whose consumption per capita is 10 kg per year.

To do this, Oimeke says ERC is working on a framework which will see LPG products become more accessible and cheaper to encourage uptake.

Energy Cabinet Secretary, Charles Keter, had in November said the cost of LPG will significantly be slashed by December.

"In a bid to encourage further uptake, we recently subsidized 6kg LPG cylinders to encourage the use of the commodity by low-income households and also cut the reliance on kerosene and charcoal," Oimeke said.

At the same time, ERC says it is in talks with Treasury to increase the tax of kerosene and make it equivalent to that of diesel.

According to Oimeke, the move is in a bid to discourage the use of Kerosene which is usually the biggest target of adulteration.

"It will now be possible to have more people consuming LPG products as they will be cheaper and much more available. At the same time, kerosene will be more expensive meaning people will opt for options such as LPGs," added Oimeke.

Oimeke speculated on a pilot project being carried out in some Kenyan informal settlements on offering gas in smaller amounts and selling it as tokens. That way, says Oimeke, Kenyans will be able to buy gas for as little as Sh200 encouraging consumption across all classes.

He was speaking during the December pump prices review forum where Super Petrol, Diesel and Kerosene had their prices increased by Sh1.47, Sh0.03 and Sh0.19 respectively.

In the review, the commission says the move was attributed to a rising average landed cost of super petrol, diesel and kerosene.

In Nairobi, which is usually used as a national benchmark, a litre of super petrol will retail at Sh104.17, diesel at Sh92.44 and kerosene at Sh71.42 while the maximum pump price for super petrol in Mombasa has been set at Sh100.89, Sh89.17 per litre of diesel, and Sh68.65 for Kerosene.


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