The big story this week: Ofgem cuts the energy price cap by 7% from 1 April 2026
Ofgem has announced that the energy price cap will fall by 7% for the period 1 April to 30 June 2026. On the headline figures, that means a typical dual-fuel household paying by direct debit will see an annualised bill of around £1,641, which Ofgem frames as roughly £10 per month (around £117 per year) less than the previous cap period.
For homeowners across Hampshire and Surrey—whether you’re in Bordon, Whitehill, Liphook, Alton, Farnham or Haslemere—this is good news. But it’s also the kind of news that can lead to the wrong decisions: people relax, delay maintenance, or assume switching tariffs doesn’t matter. The reality is the cap is a limit on unit rates and standing charges, not a promise about what you will spend, and it does not remove the underlying volatility in gas and electricity markets.
What happened (and what actually changes on your bill)
The price cap is set by Ofgem and limits the maximum that suppliers can charge most households on default or variable tariffs. It’s often reported as an “annual bill”, but the cap is really made up of:
- Unit rate (pence per kWh) for electricity and gas
- Standing charge (pence per day) for electricity and gas
From April, Ofgem says those capped rates and charges will be lower overall, reflecting improved wholesale prices and adjustments to certain policy costs. That’s why the “typical bill” figure falls. But your own result depends on:
- How much energy you use (kWh) and when you use it
- Your property’s insulation level and draughtproofing
- Your heating system efficiency (modern condensing boiler vs older boiler, radiator sizing, controls)
- Your tariff type (variable under the cap vs a fixed tariff)
- Your meter type (credit, prepay, smart meter) and payment method
Why it matters: the price cap drop changes the maths on heating decisions
When prices climb, the “payback” on efficiency upgrades looks very attractive. When prices fall, people often assume upgrades stop being worth it. In practice, a lower cap changes the payback period—but it rarely removes the benefit altogether, especially for gas heating.
Most homes around our patch—particularly in Farnham, Alton and parts of Liphook and Haslemere—are still predominantly gas-heated. If you have:
- a boiler more than 10–12 years old,
- inconsistent hot water,
- cold radiators,
- short-cycling (boiler constantly firing on and off), or
- high gas use compared with similar homes,
…then even a 7% cap drop won’t “fix” the underlying issue. It just slightly reduces the cost of running an inefficient setup.
What it means technically (in plain English): where your heating costs really come from
On a typical gas-heated home, the biggest chunk of your annual energy spend is still space heating (keeping the house warm), followed by hot water. Your ability to benefit from a lower unit rate depends heavily on whether your heating system can run efficiently at lower temperatures.
1) Boiler efficiency isn’t a single number—it depends on how it’s set up
A modern condensing boiler is most efficient when it can condense for long periods. That happens when the return water temperature back to the boiler is low enough (typically under about 55°C). Two practical things decide whether that occurs:
- Flow temperature settings (what temperature the boiler sends water out to radiators)
- Radiator output (whether your radiators are big enough to heat rooms without needing very hot water)
If your boiler is set to a high flow temperature “just in case”, it may run hotter than needed, condense less, and burn more gas. A lower price cap doesn’t change physics. If your system is over-temperature, you’re still paying more than you need to.
2) Controls matter more than most people realise
A lot of homes in Bordon and Whitehill have had extensions, garage conversions or reconfigured rooms over the years. That often leaves heating controls lagging behind the layout. When controls are basic, the boiler tends to heat the whole house on one schedule, even if only two rooms are occupied.
Well-set controls can reduce waste by:
- preventing overheating (especially bedrooms and spare rooms)
- reducing boiler cycling
- supporting lower flow temperatures
Room thermostats, TRVs (thermostatic radiator valves), smart zoning and weather compensation aren’t “gadgets”—they’re how you stop paying to heat spaces you aren’t using.
3) Standing charges still bite, especially for low users
Even if unit rates fall, the standing charge is paid every day. For smaller households (or those who are out a lot), standing charges can make the bill feel stubbornly high. You can’t “use less standing charge”. That’s why focusing only on “7% down” can be misleading. The best strategy is to reduce wasted kWh while also checking if your supplier offers a tariff structure that suits your usage pattern.
What it means financially: how to turn a lower cap into real savings
Ofgem’s headline saving is based on a typical use profile—not yours. To make this cap reduction show up meaningfully in your monthly outgoings, you need to do two things: make sure you’re on the right tariff and make sure your system is running efficiently.
Tariffs: the cap is not automatically the cheapest deal
The cap applies to default/variable tariffs, not to every fixed tariff. Suppliers sometimes price fixed deals under the cap to win customers, or they may price them above the cap if they expect wholesale prices to rise. The practical homeowner approach is:
- Check what you’re currently on (variable under the cap or fixed)
- Compare your unit rates and standing charges against available alternatives
- Consider your risk tolerance: fixed for certainty, variable for flexibility
If you’re in a larger family home around Alton or Farnham with higher consumption, a slightly better unit rate can outweigh a slightly worse standing charge. For smaller households in Haslemere or Liphook, the standing charge can dominate, so you need to compare carefully.
Boiler settings: the quickest “bill reduction” lever you can control
If you have a combi or system boiler, your current flow temperature may be higher than necessary. Many homes can run comfortable heating with a flow temperature of 55–65°C (sometimes lower), depending on radiator sizing and insulation. Hot water on a combi is separate and often needs to remain higher to achieve a good tap temperature.
What to do safely:
- Heating flow temp: reduce it gradually, then monitor comfort over a few days
- Hot water (combi): keep at a sensible level for comfortable use
- Hot water cylinder (system boiler): keep stored hot water set to a safe temperature (typically at least 60°C at the cylinder to control legionella risk)
If you lower the heating flow temperature and the house struggles to warm up, that’s useful information: it can indicate undersized radiators, balancing issues, or that your home’s heat loss is high—each of which can be addressed.
Service and system health: efficiency drops silently
Even a good boiler loses efficiency if the system water is poor, radiators are sludged, or the burner isn’t set up cleanly. With gas prices still high historically (even after this cap drop), neglecting servicing is a false economy.
Homeowners often ask whether a service “pays for itself”. It’s not a guaranteed immediate saving, but it commonly prevents:
- minor faults becoming breakdowns (especially at the worst time)
- inefficient combustion due to worn parts or incorrect set-up
- pump strain and noisy systems due to sludge or air
What it means locally: Bordon, Whitehill, Liphook, Alton, Farnham and Haslemere realities
Across our local area, we see a mix of property types—newer estates, older cottages, 1930s semis and larger detached homes. That mix matters because the best response to a price-cap change is different depending on your home.
More modern homes (often seen around parts of Bordon and newer pockets near Whitehill)
These properties are often better insulated and may already have decent controls, which means your biggest win is usually optimising settings (lowering flow temperature, fine-tuning schedules, and making sure TRVs are doing their job). The price cap drop will reduce costs, but you can magnify the benefit with small changes.
Older and character homes (common around Farnham, Haslemere and older parts of Liphook)
With higher heat loss and sometimes quirky layouts, these homes often rely on hotter radiator temperatures. Here, the practical plan is usually:
- draft proofing and insulation upgrades where possible (loft, secondary glazing approaches, chimney balloons when not in use)
- radiator upgrades in the coldest rooms
- hydraulic balancing so heat reaches the farthest radiators properly
A 7% unit-rate drop is welcome, but these homes can still benefit massively from upgrading the system so the boiler can run steadily rather than blasting on/off at high temperature.
Family homes with high hot-water use (common around Alton and larger properties near Farnham)
If you’re using a lot of hot water—back-to-back showers, multiple bathrooms—the system design matters. Some combis struggle with simultaneous demand, while stored hot water systems can be economical if properly insulated and timed. The cap drop doesn’t change how your hot water is produced; it just changes the cost per kWh you feed into it.
What you should do next (a practical plan for the next 30 days)
The best way to treat this cap reduction is as an opportunity to get your house “set up right” before the next market wobble. Here’s the order we’d recommend for most households.
1) Read your bill like an engineer (two numbers, not one headline)
Find your current unit rate and standing charge for gas and electricity. If you only look at monthly direct debit, you can miss what’s really going on—especially if your supplier is adjusting payments to catch up on winter usage.
2) Check boiler flow temperature and control strategy
If your home is comfortable, try stepping the heating flow temperature down gradually. If comfort drops, don’t immediately push it back up and forget about it—take it as a sign that your system may need balancing, radiator sizing changes, or control improvements.
3) Make sure your heating system water is in good condition
Noisy radiators, frequent bleeding, cold spots, or a boiler that seems “busy” are all indicators. If you suspect sludge or poor circulation, sorting it is one of the most reliable ways to improve comfort and reduce gas use.
4) Don’t delay essential maintenance because prices fell
A boiler that’s overdue a service, showing fault codes, or struggling to maintain temperature won’t magically behave better because the cap is lower. Safety and reliability come first—and efficiency follows.
5) Consider tariff switching carefully (especially if you want certainty)
Ofgem is openly warning that wholesale prices remain volatile. If you prefer stable household budgeting, it may be worth exploring fixed tariffs—just compare the full picture and check exit fees.
If you want us to sanity-check your current set-up—boiler type, controls, flow temperatures, radiator performance, and what improvements would actually pay off in your home—book a visit with Embassy Gas: https://www.embassygas.com/book | (01420) 558993 | helpdesk@embassygas.com