Energy consumption in South Africa is divided between industry, mining and commerce (which account for about 60%), households (which consume some 24% of energy), and transport of people and goods. The value of total energy consumption is more than R30bn each year, with LPG only accounting for about 0.5% of that amount.
The low price of coal and electricity in South Africa has contributed to the development of an economy with a large energy-intensive primary industrial sector. By contrast, the energy needs of households are far from satisfied. Although more than 60% of households have access to electricity, this energy source contributes only about 20% of household energy consumption. Most energy is obtained from fuelwood (65%) with other fuels such as coal, illuminating paraffin and a small amount from LPG making up the remainder. The reasons for this relate to issues of access and affordability. Various studies have shown that a majority of poorer households will consume fuels such as coal, IP and LPG wherever they are available, and, increasing amounts of these fuels are used in areas where fuelwood has become scarce. However, numerous factors affect household choices, with affordability being one of the most significant. In fact, even in many electrified households, fuels such as LPG are used for cooking and space heating while electricity is only used for lighting and entertainment. As LPG may be purchased in quantities and at intervals suitable to end users, it is considered to be cheaper than electricity. A recent Shell Foundation study has also shown that affordability and availability of fuels such as LPG and the particular appliances that may be used with LPG, as well as familiarity with and versatility of such alternate fuels, are all factors in current energy usage in South Africa. Access to grid electricity is therefore insufficient to meet the energy service needs of the poor in South Africa. They pay between 20 and 40% of their total household income for energy services, and will always demand a mix of energy sources to meet their needs.
Despite this, there is a growing demand for LPG in certain areas of South Africa, particularly in informal townships. LPG is used in these areas both for small businesses and domestic use - particularly if informal settlements do not have any electrical connections.