Nairobi Business Monthly
Date: 15.03.2015
Page 24­25
Article size: 463 cm2
ColumnCM: 102.88
AVE: 0.0
Illegal trade in LPG flourishes
as ERG helplessly looks on
BY ALPHA T­EMI
High demand for Liquefied Petroleum Gas
(LPG) for domestic use has opened a new
frontier of booming business causing
headache to the Energy Regulatory Commis­
they use to supply the refilled cylinders to their
customers through the estates and distribution
points.
outlet should have a calibrated weighing scale
and consumers are advised to insiston weighing
the filled cylinders to ensure they get value for
their money. The cylinders should also have
"Sometimes you don't have to go to the tefill­
safety seals, serial numbers, cylinder revalida­
The multi­billion shillings sector has seen
unlicensed suppliers, cartels and vendors, some
of wh ich advertise theirservicesattheentrance
ing depots as our suppliers bri ng them to our
tion and recertification to ensure it is not more
to each estate block wi th a n e n ti cement o f door­
to­door delivery, take advantage of lack of clear
policies from ERC to take in the billions.
It has forced ERC in conjunction with the
sion (ERC).
Ministry of Energy to launch a media campaign
warning consumers ofthe dangers of buying
LPG from unlicensed vendors.
location. Some who havemeansof transporta­
than 8 years, and proper storage.
tion however go to the depots themselves to
do the refill."
According to ERC, there are only 14 licensed
companies tosupply and refill gas cylinders and
costs cheaper and a preference foT majority of
any other person purporting to supply LPG is
doing so in contravention of the law.
Thecompanies licensed for filling and whole­
The vendors acquire the LPG at a reduced
cost ftom the suppliers, which makes their
consumers,
1 n m id ­February, most vc ndo rs we re sell i ng a
refilled i}kggascylinderatshi8oowhilea6kg
sale of LPG i n cylinders a re Addax Ke nya Li m ited,
BOCLimited, Fossil Fuels Kenya Limited, Hashi
Energy Limited, Hunkar Trading Limited, and
"There are some unscrupulous traders who,
in contravention of regulations, are filling LPG
cylinder retailed at between ShSoo to Shgoo.
KenoiKobil Limited.
Thiswaswaylowcheaperthanthep rescribed
Others are Shell Limited, Libya Oil Kenya
price of Sfuoo per kilogramme for the author­
brand owners. Such traders do not undertake
the required quality and safety checks before
ised ERC suppliers and distributors.
Limited, Midland Energy Limited, National
Oil Corporation of Kenya, Pan African Petro­
cylinders without the authority of the cylinder
filling cylinders and may not fill the required
quantities of LPG. Wholesalers and retailers
should desist from buying their stocks from
ERC declined to comment on the illegal
distribution and supply of LPG, saying there
leum Limited, Quality Gas Limited,TexTtading
Limited, and Total Kenya Limited. ~~
is a dispute relating to the issue in court and
that they would not say anything that could
prejudice the case outcome.
such traders," says ERC.
LPG is an inflammable mixture of hydrocar­
a nd cooki ng equi p ment. Mo st vendo rs rem am
undeterred by the massive media campaign and
LPG consumers we spoke to said they prefer
the cheaper cylinders supplied by the "estate
vendors" despite ERC warning on safety ofthe
warning to consumers, with some say i ng it has
done no negative impact on their businesses.
cylinders.
"As long as we have gas and we can cook, it
doesn't bother us the brand or whether it has
Michael Njuguna, a vendor who operates
been approved by the regulator," said Millicent
bon gases used as fuel in heating appliances
in Nairobi's Eastlands area says they are not
worried by the warnings as long as they get
supply to refill their cylinders.
"Our business is driven by demand and as
long as there is enough supply of LPGs from the
distributors, we will continue," said Njuguna.
M r Nj ugu na said most vendors get thei r su pply
from depots along Mombas a road and Industrial
Area, but that they are not aware whether the
supply i ng depots are licensed by ERC or not,
Anothe r ve n dor, Jame s Mu tisya sayssomeof
the suppliers have distributing tracks, which
Akinyi.
In most instances, consumers are duped on
the exact weight of LPG in gas cylinders since
they don't ask and rarely get the opportunity
for the vendor to weigh the quantity.
According to Ms Akinyi, she has never asked
her supplier to weigh thequantityof the gasand
has never compared with those from licensed
vendors. She has also never bothered to check
the brands since most ofthe cylinders are not
marked.
This is conttary to ERC's warning to consum­
ers, retailers and suppliers on safety of the gas
cylinders and their own safety.
ERC regulations demand that each retail
Ipsos Kenya ­ Acorn House,97 James Gichuru Road ­ Lavington ­ Nairobi ­ Kenya
Nairobi Business Monthly
Date: 15.03.2015
Page 24­25
Article size: 463 cm2
ColumnCM: 102.88
AVE: 0.0
Most vendors
remain
undeterred by the
massive media
campaign and warning
to consumers, with
some saying It has
done no negative
impact on their
businesses
14
Number of licensed companies
to refill and supply LPG
according to Energy Regulatory
Commission
Ipsos Kenya ­ Acorn House,97 James Gichuru Road ­ Lavington ­ Nairobi ­ Kenya