Consumers Association of Malawi (Cama) says the recent 15.47 percent liquefied petroleum gas (LPG) price adjustment will make it difficult for consumers to diversify their energy sources.

In an interview on Thursday, Cama executive director John Kapito said the LPG hike will work against government’s efforts to promote gas as an alternative energy source.

He said: “Government and Malawi Energy Regulatory Authority [Mera] have been promoting the use of gas as an alternative to use of charcoal to avoid environmental degradation.

“We expected government to ensure gas is heavily subsidised to get the larger benefits of protecting the environment. No one understands whether this government is aware of the impacts of its decisions. How does the ordinary Malawian access gas at this price and this means that government has legalised the use of charcoal.”

Last week, Mera, having considered recent trends in the world petroleum products’ prices and changes in other macroeconomic fundamentals in the local market and their impact on energy prices, announced an increase in gas prices from K2 560 to K2 956.

Mera board chairperson Reckford Kampanje said in a statement that under the automatic pricing mechanism, LPG qualified for an upward price adjustment since the change in landed cost was noted to be beyond the plus or minus five percent band.

He said: “The average FOB price for LPG increased in the month of May 2022 when compared to the price noted in the month of April 2022 used in determining the ruling retail price. The FOB price increased by 9.63 percent from 16.60 rand per kilogramme [kg] as noted in the month of April to 18.20 rand per kg.

“Since the last price revision in April 2022, the Malawi kwacha has depreciated against the South African rand by 16.47 percent trading at K71.66 from K61.53/ZAR.”

Among other uses, LPG is used for cooking and heating.

Mera figures show that Malawi uses 1.6 million kilogrammes (kg) of gas per year and is aiming at 4.8 million kg per year, with a family of four using nine kg of gas for 28 days.

From February to June last year, gas sales increased by 40 percent compared to the same period last year, according to Mera.

As of last year September, data show that Malawi had 40 LPG retailers, a situation that Mera said was due to misconceptions on LPG, which was also contributing to its low consumption in the country, pushing stress on electricity and the environment.

To lure more players to participate in this industry, last year, the regulator slashed licence fees and removed value added tax on LPG.

Mera says Mera officials said this on Thursday in Mzuzu during a sensitisation meeting with the businesss community on gas business.

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