In 2006, the Energy Act No. 12 of 2006 was enacted. This led to the transformation of the then Electricity Regulatory Board to the Energy Regulatory Commission (ERC) to also regulate petroleum and renewable energy sectors in addition to electricity. The Act states in Section 5(a) (ii) that the objects and functions of ERC include regulating the importation, exportation, transportation, refining, storage and sale of petroleum and petroleum products. Therefore one of the functions of the ERC is licensing of petroleum import, export, transport, storage, refining and sale. Construction Permits are also to be issued by ERC for all petroleum related facilities in order to check proliferation of substandard sites. All petroleum operators are required to comply with provisions for Environment Health and Safety. Petroleum products should also meet the relevant Kenya Standards.

Section 102 empowers the Minister to make regulations upon recommendation by the Commission on petroleum related activities including importation, exportation, and landing, open tender systems for importation, minimum operational stocks, and determination of retail prices for petroleum products among others. Regulations which were developed under the repealed Petroleum Act Cap 116 are deemed to be in force until repealed or revoked under the provisions of the Energy Act No. 12 of 2006.