ERC scales up tests to curb mixing of petrol with kerosene

What you need to know:

An industry lobby, the Petroleum Institute of East Africa (PIEA) estimates that nearly 80 per cent of kerosene is used in the adulteration of petrol and diesel due to the huge price difference.

The Energy Regulatory Commission (ERC) has increased sampling of petroleum products to curb rogue traders who mix kerosene with diesel and petrol in search of higher margins.

The regulator has increased the number of test samples from 100 to 150 samples per month for independent stations and from 200 to 300 samples per month for branded stations in an effort to bolster surveillance.

“The number of adulteration cases is now going down” said Linus Gitonga, the director for petroleum affairs at ERC.

The rising prices of diesel and petrol have resulted in an increase in contamination of the two products with cheaper kerosene. An industry lobby, the Petroleum Institute of East Africa (PIEA) estimates that nearly 80 per cent of kerosene is used in the adulteration of petrol and diesel due to the huge price difference.

Super petrol presently retails at Sh110.89 a litre in Nairobi, diesel sells at Sh100.67 while kerosene goes for Sh80.88. This is mainly due to the different taxes given that petrol has an excise duty of Sh19.89 a litre while the levy on diesel is Sh8.24.

READ: Nock cuts diesel price per litre below Sh100

Diesel and petrol also attract a road levy charge of Sh9 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 and large scale deterioration in the performance of engines. ERC plans to supply service station dealers with special kits to help fight the fuel adulteration menace.

The regulator is preparing regulations that propose that dealers be provided with the kits at a subsidised price of between Sh200-Sh500.

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. In Kenya, the new regulations will demand that the industry marks all kerosene meant for local consumption and petrol destined for export.

Offenders will face a fine of Sh5, 000 for each day their products remained non-compliant and Sh1 million for refusing to have them marked.

Those offering sub-standard products will also be charged Sh1 million. The present law only provides for a fine of Sh500 each day an offence continues.