State to cap LPG prices in fresh bid to tame cost, raise uptake

Gas cylinders trader in Migori Town on June 7, 2023. [File, standard] Kenya will introduce a pump price model for liquefied petroleum gas (LPG), applying the state-controlled pricing mechanism long used for kerosene, petrol and diesel to the cooking gas sector in a bid to curb rising costs and boost adoption. The government says the move is aimed at making the essential clean cooking fuel more affordable for Kenyan households and institutions and increasing its use across the country, according to a draft national petroleum policy. The landmark decision, outlined in the newly published National Petroleum Policy, reviewed by The Standard, targets a lucrative market that has historically been unregulated. This has led to high and volatile retail prices, hindering the government's ambition to wean Kenyans off polluting fuels like wood and charcoal. There has been a spirited national effort to push Kenyans to adopt LPG in line with climate change goals, yet the country continues to grapple with unlocking the enormous potential of transitioning millions away from reliance on dirty and harmful fuels such as charcoal and firewood. A 13kg cylinder of LPG retailed at an average of Sh3,146.58 last month (July 2025), marking a 0.4 per cent increase from Sh3,134.91 in June (2025), according to official statistics. The lucrative Kenyan LPG market, which relies entirely on imports to meet growing demand, has attracted a flood of local and foreign entrants. While this has increased availability, the government argues in the new policy that the lack of a structured import framework and price control has stifled competition and kept costs artificially high for end-users. "The prices of LPG in the country are unregulated and high, thus hindering LPG uptake by consumers," the policy states, identifying this as a critical barrier to achieving national clean energy goals. The Energy and Petroleum Regulatory Authority (EPRA) will be tasked with developing a "regulatory framework for LPG pricing" and conducting "periodic review of LPG prices to incorporate the economic changes," according to the policy document. The goal is to establish "fair pricing" to protect consumers. Beyond capping prices, the government plans a significant infrastructure overhaul for the energy sector. A key initiative involves piping LPG directly into public institutions. The policy mandates the development of "LPG reticulation" projects, which involve planning and constructing network systems to provide a continuous supply of gas through pipes. A central pillar of this effort will focus on schools. The government plans to "provide clean cooking gas infrastructure and seed gas to public learning institutions" under its Clean Cooking Gas (CCG) initiative. This project aims to replace traditional firewood-fired kitchens in schools with modern, safer, and cleaner LPG systems. The broader objective is ambitious: to increase LPG penetration from 24 per cent of the population in 2019 to 70 per cent by 2028. Furthermore, the government wants to double annual per capita consumption from 7.5 kg to 15 kg by 2030. To support this increased demand and stabilise supply chains, the government, through its agencies, plans to develop a 30,000-metric-tonne bulk LPG storage facility in the port city of Mombasa. This common-user facility is designed to reduce import costs and demurrage charges, which are often passed on to consumers. The move to regulate prices and invest in infrastructure signals a more interventionist approach by the government in a sector it sees as vital for public health, environmental conservation, and economic development.

State to cap LPG prices in fresh bid to tame cost, raise uptake

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