Energy regulator releases kit to check fuel mixed with kerosene at oil depots

What you need to know:

The Petroleum Institute of East Africa (PIEA) says the rising prices of diesel and petrol have resulted in an increase in contamination of the two products by the cheaper kerosene.
PIEA reckons that nearly 80 per cent of kerosene is used for adulteration in petrol and diesel due to the huge price difference.

Petroleum retailers will be provided with special kits to test the quality of fuel at depots in efforts to tame rogue traders who have been mixing kerosene with diesel in search for higher profit margins.

The Energy Regulatory Commission (ERC) will Friday launch the self-test kits, dubbed lateral flow devices, to be stationed at fuel depots across the country at a cost of Sh1,100 each.

The Petroleum Institute of East Africa (PIEA) — the oil dealers’ lobby — says the rising prices of diesel and petrol have resulted in an increase in contamination of the two products by the cheaper kerosene.

“The commission…to empower retailers to carry out independent tests on petroleum products so as to protect them from unscrupulous traders engaging in the sale of adulterated or diverted petroleum products,” said ERC director-general Joseph Ng’ang’a. The technology is modelled on South Africa’s.

The quest for instant testing is in response to calls by oil marketers for the reinstatement of taxes on kerosene, which were removed to cushion poor households that use the fuel for cooking and lighting from high prices.

PIEA reckons that nearly 80 per cent of kerosene is used for adulteration in petrol and diesel due to the huge price difference.

READ: ERC scales up tests to curb mixing of petrol with kerosene

Petrol currently retails at Sh102.65 per litre in Nairobi, diesel at Sh83.35 while kerosene sells at Sh57.98.

The variation in prices is mainly due to the different taxes given that petrol has an excise duty of Sh19.89 a litre while the levy on diesel stands at Sh8.24. Diesel and petrol also attract a road levy charge of Sh12 a litre that is not applied on kerosene.

This has seen some traders mix kerosene with diesel and petrol to enjoy higher margins in a market where the price of fuel products are controlled by the ERC.

Fuel adulteration leads to economic losses in unpaid taxes, deterioration in performance of engines and unfair competition.

In countries with the technology, oil dealers are required to dye kerosene with an imported marker that helps detect mixing of petrol and diesel with kerosene. The doped kerosene turns the mixed fuel pink when tested using the kit.