The Energy Regulatory Commission (ERC) will not regulate gas prices after all. In an earlier announcement, ERC said it was contemplating regulation of Liquid Petroleum Gas(LPG) prices after the handling and storage facility under construction in Mombasa is complete.
The commission projected that the move would result to the drop of gas prices by up to 50%. The commission’s decision not to regulate gas prices has been informed by the ongoing construction of the Mombasa storage facility which according to ERC will enable the government to import huge volumes of cooking gas.
ERC Director, General Kaburu Mwirichia attributes the shooting up of gas prices at certain periods to lack of sufficient storage space for the essential commodity. The commission expects that with sufficient supplies of gas, there will be no need for central regulation as it would encourage competition for the benefit of consumers.
The new facility is expected to be functional by July this year and it will allow for offloading and storage of large amounts of gas. Mwirichia says he expects the prices of gas to drop effectively beginning July when the facility becomes functional.
The cost of refilling a 6Kg gas cylinder went up to KES 2,900 in most outlets in December 2011 but now averages at KES 1,200, while the cost of refilling the 13 kg cylinder stood at KES 4,500 six months ago up from KES 2,400.