Regulator says LPG dealers risk market loss on price raise

Energy sector regulator says it has designed market correction strategies to insulate consumers from traders who may use the new cooking gas regulations as an excuse to increase the cost.

The said the strategy would ensure automatic market loss for dealers who increase prices in the name of compliance cost for the new Liquefied Petroleum Gas (LPG) Regulations 2019 that came into force on January 1.

“According to EPRA, the cost of compliance is negligible, hence this should not warrant any price change. EPRA has licensed many players. At the moment there is healthy competition in the LPG cylinder business. As a result, any trader who increases his prices will be getting himself out of the market,” Director-General Pavel Oimeke told Business Daily

Among other things, the regulations require dealers to provide consumers with detailed receipts on purchase of cooking gas, as well as allow consumers to claim a refund on the cylinder deposits when they chose to switch brands. The after-sales receipts should indicate both the retailer’s and the consumers’ telephone numbers, addresses of the retailer, net weight and serial numbers of the cylinder among other details that can be used to trace its source.

The regulations that banned the free cylinder pool now aim at making cylinder brand owners fully responsible for the quality of cooking gas with a heavy emphasis placed on consumer protection.

The oil marketers will also be required to maintain a list of its authorised filling agents, wholesalers, retailers and cylinder requalification agents, serial numbers or quick response codes and date of requalification of each cylinder and track cylinders by use of Radio Frequency Identification or quick response code or any other appropriate technology under the tightened regulations.