Kenya plans to set up an Energy and Fuel Stabilization Fund in the second quarter of 2018 to cushion consumers against price swings.
Energy Regulatory Commission Chief Pavel Oimeke says the framework for the fund has already been drafted and forwarded to the National Treasury for review. The regulator has further urged manufacturers to pass the benefits of low night tariffs to consumers.
Instability on the world fuel market has led to major price swings destabilizing many economies.
Global fuel prices are majorly determined by the eleven member organization of the petroleum exporting countries OPEC who produce more than ¾ of global oil total output.
The fund to be managed by the National Treasury will see the Energy Regulatory Commission hedge when prices are low.
However, consumers are likely to miss out when there is a significant drop of fuel prices in the future since the prices cannot be altered once an agreement with the supplier has been agreed upon.
Oimeke says the plans are at an advanced stage to start the regulation of gas prices, once a framework on the open tender system for gas has been formulated.
Oimeke has told the press that the government has also set aside funds for the construction of a gas storage facility at the Coast to shore up gas reserves.
The Energy Regulatory Commission has further urged manufacturers to lower the price of their goods following a 50 percent electricity tariff reduction starting from 10pm to 6am that came into effect early this month.