Proposal by Government could make refilling gas cylinders for Kenyans a nightmare

A new proposal to end the universal valve aims at weeding out illegal gas refilling. [PHOTO: BONIFACE THUKU/STANDARD]

Plans are at an advanced stage to revert to the old system where cooking gas consumers will be confined to a particular marketer.

The Ministry of Energy and Petroleum is in the process of reviewing regulations that introduced the universal valve that gave consumers the freedom to refill at any Liquefied Petroleum Gas (LPG) marketer regardless of the brand of their cylinder.

The push to revert to the old system, industry players say, has been necessitated by proliferation of illegal gas refilling businesses in the country.

It is an unintended development that the policy makers may have overlooked when they introduced the universal valve system close to a decade ago.

The universal valve has led to growth in customers for the industry, increased convenience among LPG consumers as well as growth in investments.

But it may also have led to the growth of a rogue segment in the industry, with the net effect of a decline in safety in LPG cylinders in many households, leading to deaths and injuries.

The Ministry of Energy said it had formed a committee to review the LPG Regulations of 2009 that heralded the era of a unified valve, enabling consumers to buy gas from any marketer and even retailers, irrespective of the brand. Energy Principal Secretary Andrew Kamau said recommendations of the committee would determine the direction the Government would take with regard to the LPG industry and in particular the gas cylinder valve.

“The committee has been formed and held its first meeting in December,” he said.

“The oil marketing companies, the independents, all stakeholders are on the committee and this means that the recommendations will be an agreement by the industry. There will also be a public participation phase where the recommendations will be subjected to scrutiny by Kenyans.”

He, however, declined to say the degree of success or failure of the unified valve system in the eight years it has been in place.

INCREASED SURVEILLANCE

The Energy Regulatory Commission (ERC) said the industry had made some gains, including increased investments, with the number of LPG companies almost doubling in the two years between 2014 and 2016. It, however, downplayed the impact of illegal LPG trade, noting that it had been able to increase surveillance and enforcement and that there was  only a small number of illegal refilling plants.

“The market place has experienced great improvements in terms of compliance. For instance, the number of cylinder brand owners has risen from 24 in 2014 to 40 in 2016,” said ERC in a statement.

“A majority of persons who were undertaking illegal LPG businesses have now come under the licensing regime and are now under our close surveillance. Nevertheless, there still remains a small percentage of rogue operators who can only be rooted out through strengthening of the legal provisions, which is what the committee is undertaking.”

A section of the market has in the past sensationally claimed the rogue dealers had a substantial chunk of the market, with as much as 70 per cent of cylinders in the market being filled illegally. They have also given riders that they can only vouch for cylinders sold at their outlets, mostly petrol stations. Should the committee recommend to do away with the unified valve and have its proposals adopted by the Ministry and the industry regulator ERC, then customer would have to stick to one marketer.

“In case this happens, there will be both positive and negative aspects to it. The positive is that as a customer, one will get a guarantee on the product that they are buying and in case of problems, they can make a claim from the oil marketing company,” said Petroleum Institute of East Africa (PIEA) Chairman Powell Maimba.