Say I use two fuels to heat my home (space heating): oil and wood. I purchase both in bulk, at a price decided at the time of purchase.
Wood is cheaper per kWh, but I purchase both because oil has other uses (heating water for example, plus it's sometimes useful to have redundancy). So I purchase, say, three tonnes of logs for £300, and 1800 litres of oil for £1100.
When a given fuel has been used, I must purchase some more at the market price.
Now, the price of oil has collapsed and it is now may be cheaper per kWh to use it for space heating.
So, one any one night, how do I decide which fuel to use? Should I be using the market price at the time of use, or the purchase price?