Canadian Capitalist Logo Dark
No Result
View All Result
Saturday, June 28, 2025
  • Login
  • Register
  • Home
  • Economy
  • Investing
  • Markets
  • Real Estate
  • Retirement
  • Tax Savings
  • Trivia
  • Resources
Subscribe
Canadian Capitalist Logo Light
  • Home
  • Economy
  • Investing
  • Markets
  • Real Estate
  • Retirement
  • Tax Savings
  • Trivia
  • Resources
No Result
View All Result
Canadian Capitalist Logo Mobile
No Result
View All Result
Home Uncategorised

Natural Gas: Fixed or Floating

by Ram Balakrishnan
October 12, 2006
Reading Time: 2 mins read
127 6
0
what mutual funds pay the highest dividends
152
SHARES
1.9k
VIEWS
Share on FacebookShare on TwitterShare on Linkedin

I cannot count the number of times an energy marketer knocked on our door and suggested that we sign up for a fixed-rate natural gas contract for heating our home. One of the arguments they use in their pitch is similar to the one quoted in this CBC article: consumers “would have been better off locking in to a long-term contract for 47 to 53 of the 60 months ending in May 2006″. That sounds great until you realise that it is only one data point and it might have been an unusually favourable situation for a fixed price contract that is unlikely to occur again.

I find it interesting that marketers are trying to convince us that it is better to buy fixed-rate natural gas when the annual gasoline bill is likely to be higher than the heating bill for most consumers (it certainly is the case for us and we don’t drive all that much). Yet, we are no hurry to sign up for gasoline contracts but marketers try to scare us that natural gas is going to skyrocket.

The Gas Supply Charge portion (which can be purchased from an energy marketer) typically makes up about 60% of the gas bill. As it costs about $1,500 to heat a typical home, the annual gas supply charge works out to about $1,000. The best 5-year rate (according to Energyshop.com) available now is 35.9 ¢/m³ compared to Enbridge’s floating rate of 22.54 ¢/m³. It would be interesting to track the floating and fixed rates going forward to see which strategy comes out ahead but my guess is that the stakes are decidedly small. If you can bear the risk of your energy bill spiking by $100 or more in the peak of the heating season, I would wager that it is better to go with the floating rate.

Related posts:

  1. Finding a Financial Advisor, Part 1
  2. Carnival of Debt Reduction # 19
  3. The Income Tax Cut is Better
  4. This and That
Share61Tweet38Share11

Get real time update about this post categories directly on your device, subscribe now.

Unsubscribe
Previous Post

Mortgage Rates: Fixed or Floating

Next Post

Blog Ground Rules

Ram Balakrishnan

Ram Balakrishnan

Related Posts

Why you cant afford a house in Canada

Why You Can’t Afford A Home In Canada?

January 24, 2022
558
investing benefits
Investing

Finding a Financial Advisor, Part 1

June 19, 2021
2.2k
investing in bitcoin

Is it time to invest in Bitcoins again?

May 13, 2019
2k
when do reits liquidate
Uncategorised

Performance of Currency-Neutral S&P 500 Index Funds

January 19, 2014
2k
is mortgage interest tax deductible
Uncategorised

The 2013 Sleepy Portfolio Report Card

January 12, 2014
2k
how to buy individual stocks in canada
Uncategorised

Asset Class Returns for 2013

January 5, 2014
1.9k
Next Post
what is a spousal rrif

Blog Ground Rules

Please login to join discussion
Canadian Capitalist

© 2022 Canadian Capitalist

Navigate Site

  • Home
  • Disclaimer
  • Privacy Policy
  • Advertisement
  • Contact Us

Follow Us

No Result
View All Result
  • Home
  • Economy
  • Investing
  • Markets
  • Real Estate
  • Retirement
  • Tax Savings
  • Trivia
  • Resources

© 2022 Canadian Capitalist

Welcome Back!

Sign In with Facebook
Sign In with Google
Sign In with Linked In
OR

Login to your account below

Forgotten Password? Sign Up

Create New Account!

Sign Up with Facebook
Sign Up with Google
Sign Up with Linked In
OR

Fill the forms below to register

*By registering into our website, you agree to the Terms & Conditions and Privacy Policy.
All fields are required. Log In

Retrieve your password

Please enter your username or email address to reset your password.

Log In
This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.
two man and woman standing on doorway
The man who does not read has no advantage over the man who cannot read - Mark Twain