ELGAS Knowledge Hub

A guide to LPG Pricing

28 Jun, 2023 | Business LPG, Residential LPG

In this article:

All you need to know about how LPG pricing is determined and various involved factors
LPG Pricing

How bottled LPG pricing is determined

As energy prices in Australia soar, many people are switching to LPG (propane) as a cost-effective and environmentally-friendly alternative. ELGAS is leading the way with highly competitive pricing and a network of service centres for the supply and delivery of clean-burning LPG.

LPG Price in Australia Explained

There are many factors that go into determining the price of liquefied petroleum gas (LPG) in Australia. This includes the cost of LPG cylinders according to size and LPG gas commercial rates for bulk LPG delivery. The price for LPG in Australia fluctuates over time and at ELGAS, we constantly monitor the situation and review current LPG prices to ensure our rates and charges are highly competitive.

LPG price in Australia – Saudi CP LPG – World LPG prices

The world LPG prices benchmark for the cost of LPG in Australia is the Saudi Aramco LPG price, also commonly called the Saudi CP LPG price. All internationally traded commodities are subject to price fluctuations and the Saudi Aramco LPG price changes on a monthly basis, forcing price regulator reviews at least once per month affecting the LPG price in Australia.

Australia doesn’t have an influence on LPG price benchmarks, as our production of LPG is small compared to the worldwide production of hydrocarbon gases, crude oil refining and natural gas energy sources. However, at ELGAS, we keep prices low. For example, the LPG fuel price at Australian LPG service stations is currently less than 1/2 the cost of 98 octane petrol (gasoline), whilst LPG is over 100 octane.

Exchange rates affect LPG prices in Australia

As the international price for LPG is in US dollars, the Australian dollar exchange rate also affects the average LPG price in Australia. Exchange rates change numerous times per day, making the setting and publishing of prices even more challenging.

LPG price can be expressed as LPG cost per kg, LPG Price per litre, or LPG price per tonne. Which one is a question of where in the supply chain you look. The Saudi CP LPG is in LPG price per tonne. Local pricing is expressed in LPG price per litre or by the cost of LPG gas per kg. The unit of measure for LPG pricing is situation-dependent.

LPG price and transportation costs

Transport costs and refinery terminal fees are also a significant part of the overall cost of delivered LPG in Australia, sourced from oil & gas fields, refineries and importers. There are three distance-related transportation cost variables.

• Distance from the original source to the main terminal.
• Distance from the main terminal to various local depots.
• Distance from the local depot to your location.
• Volume used affects LPG price

The cost of servicing a larger volume account is typically less than a lower volume account and affects the LPG price. Delivering larger quantities, on a given delivery, is obviously more economical. For example, autogas dealers take thousands of propane/butane litres per delivery, as compared to cooking-only customers who might use just one LPG gas cylinder every 15 months. As a result, the volume used affects the unit pricing.

New to LPG? Choose ELGAS.

ELGAS is Australia’s largest LPG supplier and services the LPG energy needs of more than 350,000 homes and businesses. Whether you are looking for LPG for your home, LPG for your business, or SWAP’n’GO for your BBQ, contact ELGAS today!

Taxes add to the LPG price

The Australian Government influences the cost of LPG gas through the application of taxes.

GST applies to all LPG sold in Australia. This adds 10% to the LPG price. LPG used for vehicles – autogas – is subject to an excise tax. The excise tax on LPG started in 2011 and has increased every year since. It is currently 12.5 cents per litre.

LPG equipment fees and charges

In Australia, LPG suppliers/distributors/providers charge an equipment fee, also called an annual fee, service charge, or rental fee. LPG equipment fees contribute to a number of associated costs involved with purchasing, testing, maintaining and replacing LPG cylinders. This helps Elgas make sure that your gas cylinders meet stringent Australian gas supply safety standards.

LPG equipment fees are charged separately to the cost of your gas consumption and are calculated according to the number and size of the gas cylinders provided. Additional fees may include:

• Account establishment fees
• Urgent delivery fees
• Service and installation charges

We can also inform you of any energy subsidy you may be eligible for. If you’re looking for the most cost-effective solutions to your energy needs, contact Elgas.

It is important to note that ELGAS is not responsible for fixing or replacing regulators or pigtails as these are privately owned by the customer.

What is LPG used for around the home?

LPG has multiple uses around the home. That’s one of the main reasons Elgas is so popular. Home LPG use includes:

• Cooking – Enjoy instant on/off and precise heat control with a targeted gas flame.
• Hot Water – The choices are yours with LPG for heating a traditional water tank or for instantaneous hot water that doesn’t rely on a tank.
• Heating – LPG gas heaters can be freestanding or built-in. These attractive appliances heat the room fast.
• Outdoors – Small SWAP’n’GO LPG gas bottles are perfect for BBQs by the pool, outdoor heating and lighting,

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