House of Commons Library

Energy Smart Meters

Published Wednesday, April 3, 2019

Between now and the end of 2020 more than 50 million new energy ‘smart meters’ are being rolled out to 30 million homes and smaller non-domestic sites in Great Britain.

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Energy smart meters are advanced electricity and gas meters which can offer a range of intelligent functions. The Energy Act 2008 gave powers to begin a smart meter rollout. Since then, successive Governments and Ofgem (the energy regulator) have been working on a rollout programme.

Between now and the end of 2020, the Government plan to rollout more than 50 million new energy ‘smart meters’ to 30 million homes and smaller non-domestic sites in Great Britain. The rollout only applies in Great Britain as Northern Ireland has a separate energy market.

The Roll Out

The smart meter rollout began in 2011 and is due to end in 2020. Until recently the only type of smart meter being rolled out was the SMETS1 specification, which has caused some interoperability problems when consumers switch supplier. Suppliers should now be installing the more advanced SMETS2 meters, though there have been delays to the SMETS1-2 switch, and there are reports that ongoing problems with the infrastructure mean that some SMETS1 are still being installed. The SMETS2 meters are using new infrastructure, provided by the Data Communications Company. Eventually, the Government want SMETS1 meters to also be using this infrastructure.

There has been concern that the 2020 deadline will not be met. The latest Government data showed that by the end of December 2018, 13.8 million smart and advanced meters were operating across homes and businesses, leaving the vast majority still to install.

Benefits and concerns

The Government’s 2016 cost-benefit analysis estimates that by 2030, the rollout of smart meters will have delivered about £5.7 billion of net benefits to consumers, energy suppliers and networks, made up of £16.7 billion benefits offset by approximately £11 billion of costs. A Government update to the cost-benefit analysis is expected in 2019.

Smart meters are intended to have benefits for consumers, suppliers and networks. For consumers, smart meters could provide more accurate bills, easier switching, clearer energy use through an in-home display, and the potential for reduced bills based on reduced consumption. For suppliers, smart meters could mean avoiding site visits (for example to check meters) and reduced customer service overheads due to more accurate billing. For networks, smart meters could facilitate a smarter grid, and the real-time data supplied by smart meters could make balancing the grid easier.

Customer concerns regarding energy smart meters include data protection and privacy, connectivity in areas with low or no mobile coverage, installation visits and doorstep selling, health concerns, disconnection of prepayment meters, and the ability to switch supplier and keep the ‘smart functionality’.

Commons Briefing papers CBP-8119

Authors: Suzanna Hinson; Sarah Barber; Paul Bolton

Topics: Companies, Consumers, Energy, Utilities

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