Increased residential LPG adoption offers relief amid escalating electricity tariffs

WITH electricity tariffs continuing their steep upward climb, South Africa is facing a pivotal moment in its energy landscape. While load shedding may have eased, consumers remain under pressure as the cost of electricity continues to rise. This challenge has opened the door to an alternative energy source that is rapidly gaining traction among households: liquified petroleum gas (LPG).

According to data from the South African Reserve Bank, electricity tariffs increased by an alarming 333 percent between 2007 and 2017, and surged to 450 percent by 2022. These escalating costs have forced many households to look for more affordable and reliable options, and LPG is increasingly emerging as a viable and attractive alternative.

StatsSA’s General Household Survey: The State of South African Households in 2023 recorded a significant rise in residential LPG usage, jumping from 2.2 percent to 6.8 percent. For Nokwanele Qonde, founder and managing director of the Black and women-owned petrochemicals company WASAA Group, this shift signals a growing public acknowledgement of LPG as a cost-effective, clean, and dependable energy source.

“The increasing penetration of LPG in residential use is encouraging and welcome news for the industry and will go a long way towards alleviating pressure on the national grid,” says Qonde. “This momentum emboldens us to step on the gas and deepen the adoption of LPG not only for the benefit of the industry, but to contribute meaningfully to the attainment of a developmental state, create feasible pathways for entrepreneurship in the LPG economy, and substantially reduce our carbon emissions.”

Qonde believes the national transition to LPG can be accelerated with policy support, particularly through subsidies aimed at making the fuel more accessible to low-income households. She points out that, despite major government achievements in expanding electricity access since 1994, many rural and poor communities still rely on polluting sources such as firewood and paraffin for cooking and heating.

“Government should consider subsidising LPG prices or providing incentives for poor households as part of the Free Basic Energy programme,” she says. “This will go a long way towards providing much-needed respite to struggling consumers who are buckling under the strain of rising living costs and consecutive electricity tariff increases.”

StatsSA’s report further shows that 29 percent of households nationally now use LPG as an energy source. Usage is highest in the Western Cape at 46 percent and Gauteng at 36.3 percent. The rise in gas usage is mirrored by an increase in ownership of gas appliances, with gas stoves and plates rising from 19 percent in 2022 to 30.1 percent in 2023.

Qonde adds that South Africa is well-positioned to support a broader transition to LPG. “South Africa has the necessary LPG import infrastructure in place. We need to leverage these capabilities to mitigate our energy challenges by implementing policy adjustments that can drive more intensified and widespread LPG use.”

She points to WASAA Group’s recent acquisition of bp Southern Africa’s East London liquid fuel import terminal through its subsidiary, WASAA Terminals, as an example of the industry’s commitment to expansion. “This historic acquisition enables us to develop an LPG facility and enhance existing infrastructure to meet growing demand in South Africa and the region,” she says.

As electricity costs continue their upward trajectory, LPG presents a practical and increasingly popular alternative. With the right policy support and continued investment in infrastructure, South Africa could see LPG become a cornerstone of its household energy mix, easing financial strain, cutting emissions and helping to secure a more resilient energy future.