The recent drop in the energy price cap on April 1st felt like a rare bit of good news. But for those of us tracking the industry daily, it’s clear that this lower cap is based on a market that no longer exists.
Since the escalation of the Iran conflict in March and the subsequent closure of the Strait of Hormuz, wholesale gas prices have effectively doubled. This surge is already starting to pull the wrong levers in the UK economy, these rising energy costs are now feeding directly into the latest inflation figures. It is a clear sign that the brief period of falling prices has stalled, and the market is beginning to price in the reality of a much more expensive summer.
At New Dawn Energy, we’re seeing a significant shift in how people are responding. This isn’t like 2022 where homeowners were just looking or weighing up their options. Today, the sense of urgency is higher. We’ve found that the current situation actually exceeds the 2022 crisis in terms of demand; people have learned how quickly fuel prices can spiral and they are moving from the research phase to taking action much faster this time around.
Global events hit the markets instantly, but they take months to reach your letterbox because of the way the price cap is calculated. We are currently living in that gap. While your current tariff might feel manageable, it’s unlikely that the next set of rates will be anywhere near as favourable. As we’ve been telling our customers recently, it certainly could be the calm before the storm.
While the price cap offers some protection to urban homes, our neighbors in the rural areas of Herefordshire and Wales are often left exposed. Heating oil and LPG prices aren’t capped, meaning rural households and farms feel the pressure of the Middle East conflict immediately.
To combat this, we’ve been implementing more bespoke tech solutions. For example, using solar and battery power paired with smart meter switches to heat hot water. This allows homes to bypass expensive oil deliveries entirely during the sunnier months. For our agricultural and commercial clients, the logic remains just as strong. Even with market volatility, a large-scale system is still averaging a four-year payback period.
A few years ago, the main question we were asked was about how much money a system would save. In 2026, the question has changed to how a family can keep their house running if the grid becomes unstable.
The government is currently leaning toward reducing our national dependence on gas by de-linking electricity prices. This makes solar a much more strategic way to protect your home than it used to be. Whether it’s a full electrification package—solar, batteries, and heat pumps—or a simple battery retrofit to take advantage of cheap night-rates, the goal now is energy independence.
When energy anxiety spikes, we always see a surge in unreliable contractors and questionable products. Recently, we’ve seen a lot of talk about cheap, plug-in solar panels being sold in supermarkets. We are cautiously nervous about this because it is currently very unclear how the government plans to regulate the safety and installation of these kits.
If you are looking at your options, the biggest red flag remains the same: any company offering a quote or an installation without a physical site visit. We’ve seen that this almost always leads to unexpected costs and poor after-care once the job is finished. A site visit is the only way to ensure a system is actually fit for purpose.
The next major price hike is predicted for July. While we have built up extra capacity at New Dawn Energy to handle the spike in demand, the final window for installations that protect you before that summer jump is approaching quickly.
The headlines might say prices are down for now, but the reality is that the energy landscape changed in March. The best time to prepare for the July cliff-edge is while the weather is turning in our favor.
We specialise in a range of renewable energy solutions, all types of domestic and commercial installations, plus electric vehicle charging.
Unit 12C
Burlton Business Park
Burghill
Hereford
HR4 7SJ
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