The following article was suggested by one of our readers—if theres an idea you would like us to cover, please submit it here. The recent sharp increase in the cost of liquefied petroleum gas (LPG), used by many families in Kigali to cook, has been attributed to external market forces that have seen the demand on the world market increase in the last couple of months. A quick survey done around the city indicates that gas refills for a 12 kilogramme cylinder rose from Rwf12,000 to 13,500 and as of today, it stands at Rwf15,500. For 20 kilogrammes, the price has increased from Rwf20,000 to Rwf25,000, for 15 kilogrammes it has risen from Rwf15,000 to Rwf18,000 while for 6 kilogrammes it was hiked to Rwf7,500 from Rwf6,000. Liban Mugabo, the Managing Director of Safe Gas Rwanda Limited, told The New Times that dealers in this business have no control over the pricing which mostly changes between November and March as the demand for gas increases since it is used for heating purposes during winter. However, he said that there is also a challenge brought about by poor market structure where there is the involvement of many layers of middlemen before the product gets to the consumer. He suggested that fixing this issue can be done in two ways, which include stocking up and selling directly to the consumer. “We can build a strategic stock to cover the high price season. We can also sell directly to the consumer to ensure lower prices. We are in the process of finalizing a home delivery solution that will eliminate all middlemen and ensure you get wholesale prices. This will put back 20 per cent in the consumer’s pocket,” he said. Marie-Jeanne Uwanyiringira, a businesswoman who exclusively sells LPG products says that the constant fluctuation in prices has caused frustration among the consumers. “When someone buys gas from me at Rwf13,500 and the next month I tell them that it is Rwf15,500, they don’t seem to understand that it is not the seller’s fault. “Sadly, some people are beginning to weigh the option of going back to using charcoal,” she said. The Rwanda Utilities Regulatory Authority’s General Manager in charge of Energy, Water and Sanitation, Alex Mutware, told The New Times in a telephone interview that although the prices are not set by his institution, they are aware and closely following the developments. He said that there are ongoing discussions with several stakeholders to ensure that these challenges do not impede the ongoing transition from using charcoal to gas for domestic uses. “We are discussing with different stakeholders including the ministries of infrastructure and trade and to see if there is any possible way of stabilising the prices in this sector so that we can align the targets we have regarding reducing using biogas for cooking,” he said. Current status In 2019, the government announced its plans to introduce strategic cooking gas reserves aimed at cushioning the country against potential shortages. The manager for clean cooking and biogas use at Energy Development Corporation Ltd (EDCL), Oreste Niyonsaba, told The New Times that the proposed reserves will cater to the rising demand for cooking gas. According to official statistics, only five per cent of Rwandan urban households use gas for cooking, an increase of four per cent from 2014. Only 1.1 per cent of rural households use gas for cooking. This means that, out of the 2,708,000 households in Rwanda, only 135,400 use cooking gas. “Currently, the households using gas need at least 26,000 tonnes of cooking gas every month. This requires strategic reserves so that when there is a shortage from countries where we import from, they can still get served,” he said. According to the government’s seven-year programme, the number of Rwandans using wood as a source of energy will be reduced to 42 per cent by 2024 from the current 83.3 per cent. However, the use of LPG in cooking has increased from 724.6 tonnes in 2010 to about 3,000 tonnes in 2017 according to figures. According to Energy Development Corporation Limited (EUDCL), there are about 11 companies that are involved in gas importation. Meanwhile, Rwandans could start using locally produced cooking gas from Lake Kivu by the end of 2022 thanks to a project that seeks to process methane into Compressed Natural Gas (CNG). CNG can be used as a substitute for petrol and diesel fuel as well as liquefied petroleum gas. Stephen Tierney, the Chief Executive of Gasmeth – the company that will implement the project – told The New Times that despite delays occasioned by Covid-19 and associated shutdowns, gas production will begin before the end of 2022. In February 2019, Rwanda inked a $400 million deal with Gasmeth Energy to extract and process methane into CNG for cooking, industrial use and vehicles. By then, it was projected that the gas would be ready for use within two years. The deal is expected to significantly cut Rwanda’s LPG imports.
