As debate rages on whether it is cheaper to use electricity instead of gas for cooking, a cartel has taken over the liquefied petroleum gas market, endangering lives and genuine businesses.
The continued establishment of refilling plants in residential areas and theft of cylinders for illegal refilling, despite the enactment of tough regulations last year, has exposed the enforcement gaps.
The Nation has established that the cartel comprises high-ranking state officials, politicians, police and judicial officers. Some of the cases are handled in a questionable manner and suspects given lenient punishments by the regulator, before being allowed to continue operations.
In one shocking incident, officers drawn from the Anti-Counterfeit Authority (ACA) and the Directorate of Criminal Investigations (DCI) conducted a night raid on a warehouse in Syokimau and confiscated close to 600 cylinders belonging to 42 different brands that the dealer was refilling. The owner was arrested and his two motor vehicles, a lorry and a private vehicle, which were loaded with the cylinders, were seized. None of the brand owners had authorised the refilling of their cylinders, an offence that attracts a Sh10 million fine.
Both the DCI and the ACA tweeted about the success of the November raid. The shock came when the suspect, who had been released on Sh20,000 bond, was meant to take plea at the Mavoko Law Courts – the Energy and Petroleum Regulatory Authority (Epra) was applying to withdraw the case and the suspect had been given back his licence after receiving a warning letter. The move sparked a fierce fight between the regulator and lawyers representing the cylinders brand owners.
Lawyer Omondi Omollo, representing one of the cylinder owners, wrote to the Epra in protest. The regulator was forced rescind its decision after complaints reached the Energy ministry and other agencies, including the Directorate of Public Prosecutions. An attempt to proceed with charges against the directors of the Mombasa Road-based firm is now under judicial review.
The firm’s director now blames Epra for going against the deal. His claim of losing Sh500,000 per day paints a picture of a lucrative venture that is also bleeding brand owners.
It is not clear how Epra resolved to pardon the firm, which it had described as a “serial offender”. Director-General Pavel Oimeke had not responded to our queries by the time of going to press.
Dealers say the regulator has pardoned various offenders under a scheme it had earlier described as “negotiated voluntary compliance”. Apart from Epra being accused of pampering offenders, ACA is also widely blamed for failing to crack the whip on the brand counterfeiters who ride on known brands by refilling them. ACA officers are said to be reluctant to charge the offenders they arrest, choosing to hand them over to the regulator. Insiders at the two agencies told the Nation that they had a thin enforcement personnel.
In another case laced with court drama, eight people were arrested in a night swoop on February 29 in Embakasi. They had a lorry refilling over 1,000 cylinders. Police also detained the lorry (KBL 244K) belonging to Wajiji International Ltd.
The owner of the lorry later emerged with a court order for the truck to be released. The order, obtained on April 23 at the Milimani Law Courts, allowed the owner to cart away the empty cylinders with police officers required to take photos. The police and lawyers of the offended brand staged a fierce defence in court to have the lorry preserved as exhibit. They succeeded.
Last month, a frustrated Energy Dealers Association wrote to Interior Cabinet Secretary Fred Matiang’i over the rampant theft of cylinders and named suspected companies. They named seven sites, three in Nairobi, and one each in Murang’a, Meru, Embu and Nyahururu.
The frustrated dealers have been seeking permission to conduct their own enforcement to protect their businesses.
LPG dealers were glad when stiff penalties were outlined for those breaching various regulations.
This included a Sh50,000 fine for selling cooking gas without a receipt. But these penalties, insiders say, have increased the bargaining power for enforcement agencies that now ask for bigger bribes.
“There is a department within Epra where everyone is rich, all because of the illegal traders who invest nothing in cylinders, including the cost of maintaining them. They have enough money to splash around and at every point they experience a hurdle,” a source said.
