The week’s big story: a forecast drop in household energy bills from April 2026
Ahead of the April 2026 Ofgem price cap update, The Guardian reported Cornwall Insight’s forecast that typical dual‑fuel household energy bills in Great Britain could fall by around £117 a year. The biggest driver isn’t suddenly cheaper gas or a miraculous improvement in wholesale markets—it’s a policy change announced in the November budget: the Government will move certain green levy costs off energy bills and into general taxation, and it will also scrap an energy efficiency scheme funded through bill payers.
On paper, the budget move could cut roughly £145 from an average annual bill, although Cornwall Insight and other analysts are flagging an important caveat: network upgrade and maintenance costs can rise at the same time and offset some of the headline saving. Ofgem is due to set the final figure shortly after, and the actual cap will depend on wholesale energy costs, policy costs and network charges in the relevant calculation window.
Why this matters more than a nice headline
Most households don’t experience energy pricing as an abstract “cap”—you experience it as:
- your monthly direct debit jumping up or down,
- the cost of running heating day to day, and
- the financial risk of a cold snap if your boiler or controls aren’t performing.
So a forecast fall is welcome. But the bigger story for homeowners is what this shift signals: energy policy costs are being rebalanced. If levies are removed from bills, the relative cost of gas vs electricity may change, which affects long‑term decisions like whether to replace a boiler, improve insulation, change radiator sizes, or plan for a heat pump.
And locally—across Bordon, Whitehill, Liphook, Alton, Farnham and Haslemere—many homes are a mix of modern estates, older properties with solid walls, and rural edges with oil/LPG or limited gas coverage. The “right” next step isn’t one‑size‑fits‑all. This policy change could make the difference between delaying improvements and doing them at the right time.
What actually happened: levies moving off bills (and what that means in plain English)
Energy bills aren’t just paying for the gas and electricity you use. They also include:
- Wholesale energy costs (the energy itself),
- Network charges (maintaining and upgrading pipes, cables, substations),
- Operating costs and supplier margin,
- Policy costs (environmental and social schemes, often collected as levies).
The change flagged in the report is that some of those policy costs—commonly called “green levies”—are being moved from being collected through energy bills to being funded through general taxation. Practically, that means the unit price you pay per kWh and/or the standing charge can reduce, because a slice of the bill is no longer needed to fund those schemes.
However, energy bills are not a single lever. If network companies need to invest heavily (for example, replacing ageing infrastructure or upgrading capacity for electrification), their charges can rise. That’s why you’ll see analysts saying “bills may fall…but not as much as you’d think.”
The technical reality: what changes on your bill and what doesn’t
When the price cap changes, the most visible impacts are typically:
- Unit rates: how much each kWh of gas or electricity costs.
- Standing charges: the daily fixed charge, regardless of usage.
It’s important to understand what a levy shift can and can’t do:
- It can reduce the “policy costs” portion of unit rates and/or standing charges.
- It does not automatically reduce your consumption. If your boiler is short‑cycling, your thermostat is poorly positioned, or your radiators are unbalanced, you’ll still burn more energy than you need.
- It doesn’t change the physics of heat loss. A draughty home in Haslemere with older glazing still loses heat quickly, regardless of how levies are funded.
From an engineering point of view, the biggest controllable factor for your bill is still how efficiently your heating system turns fuel into useful heat and how effectively your home retains that heat.
What it means financially: where the £117/year saving might actually land
Not every household will see the same saving. That “typical dual‑fuel household” is a model based on typical consumption. Your reality depends on:
- property size and insulation level,
- how many occupants are home during the day,
- heating pattern (steady low heat vs peaks),
- system type (combi boiler vs system boiler with cylinder vs heat pump),
- tariff type (price‑cap variable vs fixed vs smart tariffs).
For many homes around Alton and Farnham—where you often find larger family properties—the savings could feel smaller if your usage is above “typical” and a rising standing charge or network component offsets unit‑rate reductions. In smaller flats or well‑insulated newer builds near Whitehill and Bordon, you might notice savings mainly in the standing charge element, but again it depends on the final cap structure.
One key practical point: if your direct debit has been set high because of previous price caps, you may not automatically see it drop in April. Suppliers often keep direct debits stable to rebuild or protect account balances. You’ll need to check your statements and request a review if your account is in credit and your projected usage has reduced.
Why it matters for boilers vs heat pumps: the “electricity premium” question
Homeowners increasingly ask whether they should stick with a gas boiler or plan for a heat pump. A big part of that decision is not just the efficiency of the appliance, but the relative price of electricity to gas.
Heat pumps can be extremely efficient because they move heat rather than creating it. A well‑designed air source heat pump might deliver roughly 3 units of heat for every 1 unit of electricity used in mild conditions (this ratio is commonly called COP). But if electricity is much more expensive per kWh than gas, the running cost advantage can shrink or disappear for some homes.
Moving levies off electricity bills (depending on how the policy costs were previously allocated between fuels) can reduce electricity unit rates relative to gas. That’s why this announcement matters beyond April: it hints at a policy direction that could make electrified heating more competitive over time.
That said, don’t treat a forecast price‑cap drop as a signal to rush into any technology. Heat pumps succeed or fail on design details: heat loss calculation, flow temperatures, hot water demand, emitter sizing (radiators/UFH), and controls.
What it means locally in East Hampshire and the borders: practical examples
Here’s how this shift can play out in the real housing stock we see around Liphook, Haslemere, Alton, Farnham, Bordon and Whitehill:
- Older cottages and solid-wall homes (common on rural edges): a price‑cap drop helps, but the biggest win is still draught‑proofing, loft insulation, and heating controls that stop overheating. If you’re on an older boiler, a service and proper system setup can deliver noticeable real‑world savings.
- 1990s–2000s estates (common in Bordon/Whitehill): these often have reasonable insulation but suffer from poor control use—thermostats set too high, TRVs all fully open, and no weather compensation. Small tweaks can reduce consumption more than a policy-driven unit price change.
- Larger detached homes around Farnham/Haslemere: higher demand means bigger exposure to any unit‑rate changes. These homes often benefit from zoning, smart controls done properly, and radiator balancing to reduce boiler cycling and improve comfort.
What homeowners should do next (before April 2026)
1) Don’t wait for the cap—do a heating health check now
If your boiler hasn’t been serviced in the last 12 months, book it. A service won’t magically turn a tired appliance into a new one, but it does ensure safe combustion, checks for leaks, and can catch issues that quietly increase consumption (like poor combustion setup or blocked condensate).
If your system is noisy, slow to heat up, or has cold spots on radiators, ask about:
- balancing radiators (to distribute heat properly),
- checking the circulation pump settings,
- a system filter and what’s in it,
- whether a powerflush is actually justified (sometimes it is; sometimes it’s not).
2) Optimise your boiler controls—this is where many homes waste money
Two settings make an outsized difference on modern condensing boilers:
- Flow temperature: If it’s set too high, your boiler condenses less and runs less efficiently. Many homes run unnecessarily at 70–80°C. A lot of systems can be comfortable at lower settings, especially in milder weather.
- Proper room control: A good thermostat in the right location plus TRVs used sensibly prevents overheating rooms and cycling the boiler.
If you’re in a typical family home in Alton or Liphook, getting controls right can reduce usage regardless of what the unit price does in April.
3) Review your tariff and direct debit when Ofgem confirms the cap
When the final April cap is published, do three quick checks:
- Compare your current tariff unit rates and standing charges against the new cap.
- Take a meter reading (or check smart meter data) so you’re not billed on estimates.
- If your account is heavily in credit, ask your supplier to review your direct debit rather than leaving money sitting there.
4) If you’re considering a heat pump, use this moment to get your home “heat-pump ready”
You don’t have to commit to a heat pump to benefit from the direction of travel. The best groundwork includes:
- insulation and draught reduction,
- checking radiator sizes (low‑temperature heating needs more emitter area),
- upgrading controls and zoning sensibly,
- ensuring your system pipework and hot water cylinder (if you have one) are suitable.
This is particularly relevant in parts of Haslemere and Farnham where properties vary widely—some are excellent candidates, some need fabric improvements first.
5) Be wary of false economy: cheaper energy doesn’t fix an unsafe or failing system
A forecast saving can tempt people to “ride it out” on an older boiler. If your boiler shows any warning signs—frequent lockouts, burning smells, yellow flames, visible soot, or you feel unwell when it’s running—prioritise safety immediately. Energy pricing changes are irrelevant if the appliance isn’t operating correctly.
The bottom line: use the breathing space to cut consumption, not just cost
If the April 2026 cap does fall as forecast, many households across East Hampshire and the Surrey border will welcome the relief. But the smartest move is to treat it as breathing space: get your heating system set up correctly, reduce wasted heat, and make decisions based on how your home actually performs—not just what the next cap might do.
Want a local engineer to check your boiler, controls, or system performance in Bordon, Whitehill, Liphook, Alton, Farnham or Haslemere? Call (01420) 558993, email helpdesk@embassygas.com or book online at https://www.embassygas.com/book.