Doha, April 2020
The Vital Role of LPG in Developing Nations
Liquified Petroleum Gases (LPG), a mixture of propane and butane gases, is produced during natural gas processing and oil refining. In the aftermath of a recent oil price war, and the widespread COVID-19 pandemic, both crude oil and natural gas production will be cut back under the current bout of low demand, and as such substantially less LPG will be produced.
LPG or its individual components are used in a plethora of applications. The main uses of LPG worldwide, listed by consumption are:
However, it is LPG’s use as a far healthier and cleaner domestic fuel that is of most concern. In many parts of Africa, South America and Asia its use has replaced wood, coal and dung. Whilst its use for barbecues and artificial log fires in OECD countries could be considered as relatively minor, the use of LPG in other countries, especially in the developing world, is far from trivial.
In 2014, 3.04 billion people around the world lived without access to clean cooking fuels, a slight increase since 2012 (World Bank 2017), and about 40 percent of the world’s population still uses solid fuels and kerosene, the burning of which has deleterious health, economic, and environmental consequences.
Every year up to four million people die prematurely from the effects of household air pollution caused by cooking with solid fuels - almost all of them in low and middle-income countries (WHO 2014a; Forouzanfar and others 2016).
The need to adopt clean cooking fuels and stoves is thus urgent, in particular for residents of countries in South and Southwest Asia. However, it is in Sub-Saharan Africa that one finds the highest deficit in access to clean cooking fuel in proportion to the population: only 12 percent of Africans had access to clean cooking fuels and technologies in 2014.
The increase since 2012 in the number of people living without access to clean fuel has also principally been driven by Africa, where each year the population expands by 25 million, while access to clean cooking increases by only 4 million (World Bank 2017).
Achieving Sustainable Development Goal 7 (SDG7) - ensuring access to affordable, reliable, sustainable, and modern energy for all by 2030 - will therefore require a massive scale-up in the deployment and adoption of clean and affordable clean cooking solutions (WHO 2016).
In India nearly 80% of all domestic households use LPG as a cooking fuel. Government schemes such as Pradhan Mantri Ujjwala Yojna, and initiatives such as streamlining subscription processes and payments, delivery of cylinders, and subsidies for cylinders in order to wean out dependency on traditionally employed hazardous cooking fuels, have resulted in increasing adoption of the gas mix as a domestic fuel. This Demand for LPG for domestic cooking is mirrored in all non-OECD Asian countries such as Bangladesh, Pakistan, Thailand and Indonesia. For Asia, this shift towards LPG for the supply of the cooking gas has however led to a degree of over-dependency on imports from countries in the Middle East like Qatar, currently the world’s largest exporter of LPG.
A senior executive at one of the Oil Marketing Company (OMC), recently told ET Energy World that LPG penetration has however almost reached a saturation point and consumption of LPG may from now be flat or witness a decline in the coming future.
Notwithstanding, it is safe to conclude that billions of people still rely on LPG for cooking, and anything more than a short- term shortage will be catastrophic.