As the government announce targets to install 53 millionsmart meters in homes in the UK by the year 2020, and as their two colourful mascots, Gaz and Leccy, appear on our tv screens and billboards plugging the scheme, we think it’s about time we clear the air and help you understand what’s going on and how installing a smart meter in your home could help not just you as an individual, but also the energy market and the environment as a whole.
There’s been a huge drive of late, throughout much of the developed world, to get smart meters installed in homes and businesses in an attempt to save customers money, improve competition in the energy sector and, as some analysts argue, continue to global fight against climate change.
But what exactly are smart meters? And how exactly will the work to achieve these arguably lofty aims?
We’ll answer these question, and more, over the course of this article.
What are they and how do they work?
The government’s website describes smart meters as “the next generation of gas and electricity meters” that “can offer a range of intelligent functions.”
Now this ‘range of intelligent functions’ doesn’t extend far beyond measuring your home or business’ energy consumption, but it’s the manner in which they do this that makes them helpful.
Smart meters measure your gas and electricity consumption digitally, giving you real-time access to the information via a special in-home display device (like a tablet), as well as sending it to your energy provider across a dedicated network.
This dedicated network, that will be rolled out fully in August 2016, will be built and managed by the newly put together Smart Data Communications Company (SDCC) – built up of Arqiva and Spanish telecoms company O2/Telefonica. Smart Energy GB though, the organisation in charge of the campaign to roll out smart meters across the UK, have made a point to make it clear that the you, the customer, own the data from your smart meter, not the SDCC, and not your supplier.
So how will a smart meter help me?
One thing that the smart meter won’t do is give you a detailed breakdown of how much energy is being used by each appliance in your home; you’ll only be given details on how much you’re using in total, and how much it’s costing you.
In order to get a proper breakdown of which appliance use what, you’ll need smart appliance that can feed that information to the meter. Beama’s CEO Howard Porter does think that we are not a million miles away from this happening though, and that the installation of smart meters in homes throughout the country is a genuine “catalyst” and is “stage one in the move towards connected homes and buildings linked in to smart grids.”
Until then, what you can do is simply watch your meter as you turn certain appliance on or off and see the difference in energy usage, altering it accordingly in the interest of economy. You might find, for example, that that electric heater you’ve been using is costing you a lot to run, and so you could limit your usage of it in order to save money.
Will a smart meter save me money?
So while installing a smart meter won’t directly save you money just by virtue of it being installed, it can help you adjust your usage you can then cut down your bills as a result –it’s how you respond to the information that a smart meter provides you with that makes a difference. Indeed according to their own calculations, the government reckon that with smart meters installed, we could, as a nation, save around £17 billion on our collective energy bills over the next 15 years.
Ann Robinson at price comparison site U-Switch agrees about the drastic difference that smart meters could make. “We’re all going to be much more in control of our energy usage than we are now” she said. “We’ll have so much more data about how we use energy and how we can reduce the costs. We’ll be able to pay less, use less and waste less.”
One key benefit to smart meters is that they mean the end of estimated bills – something that sees countless customers overcharged every month. No longer will an energy provider find themselves charging you for the amount of energy they think you could have used; both they and you will have a record of your exact consumption, in real-time.
Improving the switching process
What the can also do is help you work out whether or not you’re actually getting the best deal possible, based on your consumption. This is where they figure in the on-going drive for increase and improved competition across the energy market. The hope is that the wide scale installation of smart meters will reduce the already weakening stranglehold that the Big Six (E.On, EDF, Npower, Scottish Power, British Gas and SSE) have on the market.
Easily available and accurate information about your usage will also make the entire switching process much easier, something that Ofgem want customers to able to do in just 24 hours.
The government’s current target is to have over 50 million smart meters installed in 26 million homes across the UK by 2020 in what Smart Energy GB describe as “the biggest national infrastructure project in our lifetimes.”
Part of the problem in going beyond this is that many homes in the UK are actually incapable of making use of a smart meter due to dated electricity set-ups.
As the roll-out progresses, the government are in the process of enforcing rules and regulations are in place that protect customers, making sure that they can maintain propriety over and access to their data, making sure that the digital systems are totally secure, and ensuring certain “technical standards for the smart metering equipment.”
Back in 2009, the government imposed an ultimatum on energy suppliers, requiring them to provide smart meters to all of their business customers within 5 years.
And they were serious about it – energy giant E.On were fined £7 million for missing their deadline of April 2014, at which point they had only given smart meters to 13,000 of their 20,000 business customers. Following the issuing of the fine (which will be paid to the Carbon Trust), the government have warned that if E.On continue to fail to meet the designated target, then they may face a sales ban. This would involve a total ban on taking on any new customers unless they are provided with a smart meter straight away.