Cooking gas cylinder target raised to 470,000 in subsidy plan

liquid petroleum gas cylinder

Retailers selling liquefied petroleum gas (LPG).

Photo credit: File | Nation Media Group

The government now targets to distribute some 470,000 six-kilogramme liquefied petroleum gas (LPG) cylinders under a State subsidy scheme over the next three financial years starting July, a work plan by the Petroleum Department shows.

This marks a substantial raise from the initial 300,000 cylinders earlier marked for distribution in a budget plan by the Treasury in June 2022.

The cooking gas will be distributed under the Mwananchi Gas Project which is an initiative through the State through the Petroleum ministry and the National Oil Corporation of Kenya (Nock).

Under this project, a 6Kg gas-filled cylinder complete with accessories such as a burner and grill and trading under the brand name “Gas Yetu” is being distributed at a discounted price of Sh2,000 to households that would otherwise not afford them.

Promotion of LPG

“Over the medium-term period, promotion of LPG uptake through the Mwananchi Gas project will facilitate the use of clean energy and protect the environment. Purchasing and distribution of 470,000 - 6kg LPG cylinders to low-income households will undertake this initiative” a budget plan on the LPG subsidy project said.

A switch to LPG is a key part of President William Ruto’s Bottom Bottom-Up Economic Transformation Agenda (BETA). The National Treasury through the Finance Bill 2023 aims at making LPG more affordable by exempting it from value-added-tax (VAT), Import Declaration Fees (IDF), and Railway Development Levy (RDL). LPG is currently subjected to taxes at the rates of 8 percent VAT, IDF, and RDL.

The revival of the LPG subsidy scheme would come as a major relief for households pressured by the present high prices of the commodity. LPG is the preferred energy source for households that can afford it in major towns due to its convenience and because it is cleaner than other cooking fuels.

The cooking gas subsidy scheme introduced by the Energy ministry during the 2016/2017 financial year was aimed at cutting reliance on environment-unfriendly kerosene and charcoal, which are the main source of fuel for most rural and urban poor households.

The implementation of the scheme was however hindered by some suppliers who provided faulty cylinders. The plan was also adversely affected by distribution challenges at the State-owned National Oil Corporation which was to drive the programme.