Cheaper cooking gas is on the horizon for Kenyan households as global prices for liquefied petroleum gas (LPG) have dropped to their lowest levels in more than two years, signaling the potential for more affordable supplies of this essential commodity.
According to data from Trading Economics, the price of propane, or LPG, currently stands at KES 103 per gallon as of Friday. That’s a significant 29% drop from the KES 133 shilling per gallon price recorded on February 27, 2023, just six months ago.
The steady decline in global prices is a welcome change for consumers, especially after propane prices reached a 10-year high in February 2022.
This drop in global prices has already begun to lower local prices, with LPG dealers in Kenya reducing costs for both 6-kilogram and 13-kilogram gas cylinders. Data from the Kenya National Bureau of Statistics shows a 13kg cylinder, which cost KES 3,106 in September 2022, dropped to KES 2,795 last month – a roughly 10% decrease.
A spot check on Friday revealed Total Energies was refilling a 6kg cylinder for KES 1,380 and a 13kg for KES 3,160, while Pro Gas charged approximately KES 1,350 and KES 3,090. In contrast, on February 2, 2023, those companies refilled the 6Kg and 13Kg cylinders at KES 1,540 and KES 3,330, and KES 1,500 shillings and KES 3,000 shillings, respectively.
While LPG prices have declined, other energy sources like petrol, diesel and kerosene have reached record highs. Electricity prices also increased up to 63% in April, attributed to new three-year tariffs.
To aid affordability, Kenya’s 2023 Finance Act exempted LPG from value-added tax. Experts suggest the LPG price drop will make the clean energy source more accessible to households and benefit the environment by encouraging use of cleaner fuels.
The Kenyan government is considering regulating cooking gas prices similarly to how fuel prices are currently capped, which could provide stability if implemented.
This decrease in the cost of LPG has significant environmental and economic implications. Experts at KPMG suggest that this reduction in LPG prices is not only expected to make this clean energy source more accessible to households but also positively impact the environment by encouraging the use of cleaner energy sources.
As consumption of cooking gas has been steadily increasing in Kenya over the past decade due to its affordability in comparison to alternatives like firewood, charcoal, biogas, and kerosene which are termed as ‘dirty fuels’. The Kenyan government is considering the regulation of cooking gas prices, similar to the regulation of fuel prices. If implemented, this regulation could provide consumers with more price stability and predictability, as it would follow the price capping regime currently in place for fuel, with new price releases every mid-month by the Energy and Petroleum Regulatory Authority (EPRA).
