What happened (and why it’s a big deal)
On 21 April 2026, the government published a statement on GOV.UK outlining a targeted package of measures designed to reduce the pass-through of natural gas prices into electricity bills. In plain English: the UK’s electricity costs are often heavily influenced by gas prices, even when a growing share of electricity is generated by renewables, nuclear, and imports. When gas spikes, electricity bills can spike too.
This matters for homeowners because the UK is in the middle of a heating transition. Heat pumps, electric boilers, and smart electric heating controls all sit on the assumption that electricity becomes more stable and better value versus gas over time. A policy shift aimed at “breaking” the link between gas and electricity pricing is a signal that government wants to reduce volatility and support a longer-term rebalancing of energy costs.
For households around Bordon, Whitehill, Liphook, Alton, Farnham and Haslemere, where we see a mix of modern estates, older solid-wall properties, rural homes with oil/LPG, and plenty of combi boilers, the practical question is: what should I do with my heating system now?
Why gas has been setting electricity prices (the plain-English technical bit)
The electricity market has historically worked in a way that’s often described as “marginal pricing”. Demand is met by stacking different generation sources—wind, solar, nuclear, interconnectors, biomass, gas plants—until enough is online to meet demand at any given moment.
When the system needs gas power stations to top up supply (which is common during cold still evenings), those gas stations tend to be the last and most expensive units needed to meet demand. In many market designs, that “marginal” price becomes the market clearing price, meaning cheaper generators are paid the same market rate as the expensive one required at the margin.
So even if your electricity that day is largely coming from wind and nuclear, the wholesale price can still be pulled upward by gas. That’s the “gas sets the price of electricity” problem the announcement is trying to address.
From a heating perspective, that linkage has been a barrier. If electricity prices remain high relative to gas, then even efficient electric heating can feel expensive on the bill—unless the home is well insulated and the system is designed properly.
What the government is trying to achieve
The stated aim is to stabilise household costs and improve energy security by reducing how much gas price volatility shows up in electricity bills. While the exact mechanics will depend on how measures are implemented and regulated, the direction of travel is clear:
- Less electricity price volatility driven by gas (especially during global gas price spikes).
- More predictable investment signals for low-carbon generation and flexibility (storage, demand response, network upgrades).
- Better alignment between the actual mix of generation and what consumers pay.
For homeowners, the biggest implications are around the relative running costs of gas boilers vs. electric heating (especially heat pumps), plus how quickly smart tariffs and time-of-use pricing become relevant to everyday heating decisions.
What it means technically for your home heating choices
1) Heat pumps: the running-cost equation could improve
A heat pump doesn’t create heat; it moves it. Typically, for every 1kWh of electricity you put in, you might get 2.5–4kWh of heat out, depending on design, outdoor temperature, radiator sizing, and your flow temperatures. That efficiency is called the Coefficient of Performance (COP) (or seasonal efficiency, SCOP).
When electricity is expensive compared to gas, the advantage of a heat pump can be squeezed. If electricity prices become less tied to gas swings—and potentially better reflect cheaper generation—heat pumps become more financially attractive for more households.
However, it only works in your favour if the system is properly designed: low flow temperatures, correct emitter sizing (radiators/UFH), good controls, and decent insulation. A poorly designed heat pump system can still cost more to run than expected.
2) Boilers: still common, but “future-proofing” matters more
Gas boilers aren’t disappearing overnight. In towns like Farnham and Alton, we still see many well-maintained condensing boilers with years of life left, and for many households a boiler replacement remains the practical choice—particularly where a home isn’t yet ready for a low-temperature heating system.
But this policy direction is another nudge: if electricity pricing becomes more stable and competitive, the long-term running-cost advantage of gas can shrink. That doesn’t mean you must rip out your boiler—it means that when you do replace it, it’s worth choosing and setting it up in a way that keeps your options open.
Practical examples of “future-proofing” a boiler-led system:
- Set the boiler up to run at the lowest effective flow temperature (often 55°C or below for condensing efficiency, where the system allows).
- Make sure radiators are correctly sized and balanced so rooms heat evenly at lower temperatures.
- Upgrade controls (load/weather compensation where compatible) so the boiler doesn’t short-cycle and waste fuel.
3) Smart tariffs and thermal storage become more relevant
If the electricity market is shifting to reflect cheaper periods more accurately, then time-of-use tariffs (cheaper electricity at off-peak times) may become more attractive and more widely adopted.
For heating, this can change how you run your home:
- Heat pumps can be scheduled to do more work in cheaper hours (within comfort limits).
- Hot water cylinders can be heated during off-peak periods.
- Homes with battery storage may optimise import/export more effectively.
In areas like Liphook and Haslemere, where some properties have larger footprints and higher hot-water demand, a well-insulated cylinder and smart control strategy can make a noticeable difference, especially if tariffs reward flexible use.
What it means financially (what could change on bills)
There are three layers to your energy bill: wholesale costs, network costs, and policy/operating costs. This announcement is about reducing how gas wholesale price movements drive electricity wholesale prices. That could lead to:
- Less dramatic electricity price spikes during gas market shocks.
- More confidence in long-term electric heating running costs if mechanisms work as intended.
- More stable budgeting for households using electric heating or running a heat pump.
But it’s important to stay grounded: changes like this don’t always translate into immediate bill reductions, and the details of implementation matter. Also, even if wholesale pricing becomes more favourable, your total bill still includes standing charges and network costs, which are a major factor for many households.
What you can do right now is focus on the changes that reliably lower bills regardless of market reforms:
- Reduce heat demand: draught-proofing, loft insulation, sensible ventilation upgrades.
- Improve heating system efficiency: correct boiler settings, balancing, smart zoning where appropriate.
- Choose the right upgrade path: a heat pump works best when the home is prepared for low-temperature heating.
What it means locally for Bordon, Whitehill, Liphook, Alton, Farnham and Haslemere
National policy shifts land differently depending on property type, local infrastructure, and the heating fuels already in use.
Bordon & Whitehill
With a mix of newer developments and established housing, there’s a real opportunity for low-temperature heating strategies—whether that’s optimising a modern condensing boiler or preparing for a heat pump in future. Newer homes often have better insulation and radiator sizing that can more easily support lower flow temperatures, which is crucial for both boiler efficiency and heat pump performance.
Liphook
We commonly see larger family homes and a spread of heating types. If electricity pricing becomes less gas-driven, heat pump interest typically rises—but we still find many homes need upgrades to emitters and controls to get the best from them. If you have an ageing hot water cylinder or poor insulation around it, you could be losing money every day regardless of tariff.
Alton
Alton has plenty of traditional homes where insulation and fabric performance vary. The best “first move” often isn’t a heat source swap; it’s getting the heat distribution and controls right. Many boiler systems run hotter than needed, which increases gas use and reduces condensing efficiency. Lowering flow temperature safely can bring savings immediately.
Farnham & Haslemere
In these areas we see a lot of character properties alongside more modern builds. For older homes, the pathway to lower running costs usually looks like: fabric improvements → heating controls → emitter upgrades → then heat source decisions. If electricity prices stabilise and improve against gas, more homeowners will find the jump to a heat pump financially reasonable—but it still hinges on the home being able to run comfortably at lower temperatures.
What homeowners should do next (practical steps that pay off)
Step 1: Check your boiler settings (most are not optimised)
If you have a combi or system boiler, look at the central heating flow temperature setting. Many homes are set to 70–80°C “because that’s how it’s always been.” If your radiators can still heat the home adequately at a lower setting, you can often reduce gas use and improve comfort.
As a rule of thumb, many condensing boilers perform best when return temperatures allow them to condense (often supported when flow is around 55–60°C, depending on system). Don’t change settings blindly if your system struggles—especially in cold snaps—but it’s worth testing and fine-tuning.
Step 2: If you’re considering a heat pump, assess readiness not hype
A heat pump decision should be based on an honest survey of:
- Heat loss (how much heat your home actually needs in winter).
- Emitter capacity (radiator sizes/UFH suitability at low flow temperatures).
- Hot water setup (space for a cylinder, pipework condition, insulation).
- Controls and zoning (steady operation is usually better than aggressive on/off cycling).
In practical terms: if your home only feels warm when the boiler is set very hot, that’s a sign you may need radiator upgrades or insulation improvements before a heat pump will shine.
Step 3: Don’t overlook balancing and hydraulics
A surprisingly high number of homes in and around Bordon, Alton and Farnham suffer from uneven heating: some rooms roasting, others cold. That’s often a balancing issue, sometimes compounded by sludged-up radiators or an incorrectly set pump.
Balancing, inhibitor checks, and (where needed) a powerflush or targeted remedial work can improve heat delivery and cut runtime. Better distribution also supports lower flow temperatures, which is the foundation of both modern boiler efficiency and heat pump performance.
Step 4: Use your hot water cylinder properly (or consider adding one)
If you have a cylinder, ensure it’s well insulated and on a sensible schedule. If smart tariffs become more favourable, the cylinder becomes a tool: heat it during cheaper periods and reduce peak-time consumption.
If you’re on a combi and thinking long-term, it’s worth understanding that many heat pump systems are easier to run (and often more comfortable) with a cylinder. That doesn’t mean you must change now, but it’s part of the planning.
Step 5: Keep an eye on tariffs—but fix the basics first
Tariff optimisation can help, but it can’t rescue a wasteful system. A properly set-up heating system can save you money every hour the heating runs, regardless of who your supplier is. Once your system is efficient, smart tariffs and scheduling become the icing on the cake.
The bigger picture for the next 12–24 months
This announcement is a signpost: policymakers want electricity prices to better reflect a changing generation mix and to reduce exposure to gas volatility. If the measures succeed, we’d expect a gradual strengthening of the case for electrification—particularly heat pumps—while also increasing the importance of controls, flexibility, and low-temperature heating design.
For homeowners across Whitehill, Liphook and Haslemere, the sensible approach is to make upgrades in a sequence that avoids waste: reduce heat demand, improve distribution and controls, then decide on the heat source when the numbers (and your property) are ready.
If you want help working out the best next step for your home—whether that’s boiler optimisation, heating controls, radiator upgrades, or planning a future heat pump—book a visit with Embassy Gas: (01420) 558993 | helpdesk@embassygas.com | https://www.embassygas.com/book