Fire is useful. It generates heat to warm your house or cook your food, or to lights the fuses of your bombs. It's also handy if you can start a fire underwater and take it to the surface, so you can light someone's ship on fire (don't worry, we covered it in pitch, earlier). So how can mermaids generate fire?
Note these are pre-industrial mermaids. They do have basic electrical sciences via their breeds of electric eels, and advanced gas understanding. They can make pressure vessels out of copper alloys.
Fuel:
Part of the question is what fuel you can use. The mermaids do have gas tanks. So could it be O2 and hydrogen? Or Methane, or acetylene? The latter one turns into a toxin when mixed with water, so may not be ideal for mermaids.
Ignition:
After you have the fuel, how do you make it burn and keep it burning? Most of their technology is at the level of the 17th century or less. Could their electric science be advanced enough to create some kind of battery to create a spark?
Utility:
Depending on what is chosen for the other two... what will this fire be safe and practical to use for? Could it be used for lighting in the midnight zone? Would it be safe to use for cooking or will it blow you up?