Having entered an era where deregulation means that we have many more suppliers to choose from, many of us have used the energy switching websites to compare gas and electricity prices. Perhaps you have noticed that one of the questions you might be asked is whether you have a smart meter installed. As it is early days in the smart meter programme many people who don’t yet have one may have been left wondering what it is all about and whether they are missing out on something that could save them money.

The Smart Meter Programme

In order to meet targets for reductions in CO2 emissions, the Department of Energy and Climate Change  sees smart meter technology as a fundamental and very important part of the process. Currently being installed in new homes, it is expected that the mass roll-out of the programme will happen between 2014 and 2019. This is a massive undertaking because suppliers will be replacing over 53 million conventional gas and electric meters in 30 million homes during the programme.

What is a Smart Meter

A smart meter is similar to the meter you currently have installed, but with some much more advanced functions.

 The smart meter will be able to communicate your energy consumption back to the supplier in real time using the 3 and 4g mobile network. This means that meter readers will no longer need to visit and readings will be completely accurate. It will also enable the supplier to regulate the amount of supply entering your home according to consumption as part of increasing the efficiency of the distribution process, and to turn the supply on or off remotely. From the point of view of the supplier this gives them an amount of control that could make people feel uncomfortable. The ongoing consultation process should address this issue so that supply companies are not able to abuse this new control.

From the point of view of the consumer, the estimated bill will disappear and a prepay function built into the meter as standard should eliminate higher tariffs for prepay customers. Other benefits for the consumer will be the fact that they can monitor usage in real time and adjust they way they use energy accordingly. Not just able to record total usage these new meters will be able to break down your consumption and tell you what it was used on; for example which white goods or appliances are gobbling up your energy. You will also be able to download historic usage data into your home network and use this to identify ways that you might be able to become more energy efficient.

Concerns Over Smart Metering

As touched on earlier, there are some concerns arising from the smart meter programme:

  • Will the suppliers abuse the new control they have over supply?
  • Who will have access to the data being generated and how will it be used?
  • With each supplier installing a different variation on the smart meter will it still be as easy to switch energy companies?

These concerns are being addressed with protection for the consumer being built into the roll-out process. It is likely that smart meter implementation will be different between individual suppliers but they will be required to introduce some standards that apply across the board. Overall, the process is likely to simplify the confusing tariff system and provide more accuracy and clarity to the pricing and charging procedures currently in place. It will also give any household access to information in real time, that will assist them to save energy and therefore reduce energy costs.