Should I end fix early and refix for 24 months in the light of the Gas price spike?

spot1034

Dolor said:

A picture saves a thousand words. Wholesale costs do not include standing charges: these are the costs of getting the gas to your home.

Yes, if the wholesale price doubled then this would translate in higher unit costs as follows:

Unit Cost is 3p/kWh of which 1.2p/kWh is the wholesale cost of the energy supplied. If the wholesale cost doubled to 2.4p/kWh then the new cost per kWh to you would be 4.2p/kWh.

NB: there are reports that the Government is going to make an announcement of Monday to add some form of carbon tax to gas. It is unclear whether a fixed contract would provide any consumer protection. The aim is to make electricity look cheap so that consumers ditch their gas boilers and install heat pumps.

Last point, without looking I suspect most if not all contracts have a clause that states that if the tax charge changes, this can be passed on to the consumer. That'll be the main reason why you so often see prices quoted before the addition of VAT. 

Whatever announcement might be made by government, I'd say it's exceptionally unlikely there would be any change for quite some time. It would almost certainly be part of a budget speech and quite possibly it would be one of those announcements where a pretty long period of notice was given. It's not going to happen next week.