Why is butane gas more expensive in petrol stations than the government regulated rate?

In November, the maximum sale price of the butane gas cylinder dropped almost 5% after more than two years of uninterrupted increases until the Spanish Government capped the price in May, at 19.55 euro. With this drop, the price of a 12.5-kilogram bottle of butane gas is set at a maximum of 18.58 euro, a price which will remain static through much of winter, until January 17, 2023.

However, this price has confused a number of people, as for example, a trip to the local Repsol petrol station at the end of November revealed the price at 23 euro for a bottle of gas, far more than the maximum set by the Government. So, the obvious question is, why is butane gas more expensive in petrol stations than the government regulated rate?

The answer is more straight forward than you might think, and before you ask another obvious question, yes, it is allowed.

Before we explain the reason, let us first look at a bottle of butane gas. For the sake of simplicity, we are referring only to the standard sized bottle that you might obtain to fuel your gas heater, or your cooker, at home.

The vast majority of homes in Spain do not benefit from piped gas, and so have to rely on bottles of butane gas, or bombonas, as they are called in Spainish. In order to obtain the gas, it is normal to contract a service with one of the suppliers, most likely Repsol, or Cepsa. You pay for the setting up of the contract, around 15 euro at the moment, according to the Repsol website, and a deposit for the initial gas bottle, or bottles, which is a little over 3 euro each, and they supply filled replacements on request to your home, you subsequently only paying only for the gas they supply. Your contract is most likely timeless, as you will never have to renew it. To obtain more gas, you simply telephone your supplier when you want and they deliver it to your home, or, as is the way with the modern world, you can also order through their app.

However, not everybody wants to wait around at home for a delivery, and it is quite common for gas users to take their empty bottle to their local motor fuel filling station, again, Repsol or Cepsa, and simply swap the empty bottle for a full one, paying over the counter.

Now, herein lies the root of our problem. Not too long ago, the gas companies introduced us to a new, lightweight gas bottle, the “bombonas ligeras”. They started to appear at fuel stations, and gradually replaced the heavier version, but this new bottle differed from the original bottle, “tradicional”, not only in that the empty canister was a lot lighter, which of course made it easier to carry when full, thus potentially allowing more people to use the convenient, over the counter, method, but it differed in one very significant other way, which was not widely publicised.

Bombonas ligeras were sold under a free market agreement. Anyone can purchase one, without the need for a contract, and without paying the deposit for the bottle. This is one of the justifications for a higher price given by the gas suppliers. The characteristics of the part of the bottle which delivers the gas are universal, and so the canisters are interchangeable with their heavier cousins, and will work in the domestic setting just as well as the “traditional” canisters, but it is because they are sold into a free market, they are not capped by the government’s price policy.

It is now becoming increasingly likely that these lighter canisters will also be supplied to homes directly, but through a contracted service, and still at the unregulated rate.

In conclusion, having explained a little bit about the history, the answer to the question as to why butane gas is more expensive at a petrol station is that those cylinders are sold in a free market, and are not capped by the Government. In order to benefit from the reduced rate that the Government implements on gas prices, you must have a contracted supply, and must contact them for replacements to be delivered to your home, even if that actually costs the energy company more than if you solve their “last mile” function by collecting it yourself.

Finally, as we have been mentioning Repsol more than Cepsa, their app is called “Bombona Butano Repsol”. It is available for both Android and iOS, and is free. The app is in Spanish only, but with a little knowledge of the language most people should be able to navigate through putting personal details and their address in, for example. You can then order your butane gas directly in the app, and it links you with a local distributor to deliver your gas.

As you can see below, once in the app, you can order the cheaper, regulated gas bottle, or the ore expensive, unregulated, light version if you wish.