Dear Prime Minister, the energy market is broken

by , Executive Director Energy & Home 17 October 2012
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Energy companies have hiked prices, but are their reasons really justified? In this letter to Prime Minister David Cameron, we call on him to commission an urgent, independent review into the energy market.

Pound coins on energy prices

Dear Prime Minister,

Today marks the anniversary of the Energy Summit you held that promised action to help people to keep their energy bills down.

One year on, and with winter fast approaching, more than 20 million households are facing inflation-busting price rises as four of the UK’s largest energy companies put their prices up yet again.

With the average energy bill already rising 13% since last year, it is no wonder consumers tell us that energy prices are one of their top financial concerns.

After the Energy Summit, you said “we are making energy companies be competitive” but there is little evidence of this. 75% of consumers are on the most expensive tariffs and the level of switching continues to decline.

It’s time to face facts: the energy market is broken.

People are questioning whether they are paying a fair price for their gas and electricity. The energy companies blame wholesale price increases but even the regulator has found that prices don’t fall when the wholesale price drops. The sector is dominated by a handful of big and powerful players who are seemingly unaffected by the normal competitive pressure of price and customer service.

They also blame the cost of implementing your government’s environmental and social policies for the price rises. Yet, as your own Energy Department has said, there is no hard evidence to back this claim up.

Claim and counter claim are played out in the media but consumers deserve the truth. Ofgem’s proposals to change the retail energy market, expected shortly, are necessary but not enough.

Urgent, independent review into the energy market

So today we are calling on you to launch an urgent, expert, independent review into the rising cost of domestic energy bills and whether competition among energy suppliers can be made to work more effectively in the consumer interest. We want an independent review to look at whether the reasons given for the recent price increases are justified.

We also believe a review must identify what reporting measures should be required of energy companies, relating to both the wholesale and retail markets and the costs of social and environmental policies, to increase transparency and give consumers confidence that everything possible is being done to keep energy prices in check.

The review must also consider whether the regulator should now be required to better protect the majority of consumers on expensive ‘standard’ tariffs by introducing a fair cap on ‘standard’ prices.

Until we see greater transparency and prices presented clearly, consumers will continue to distrust the energy market and remain unable to drive genuine competition through moving to the cheapest tariffs.

The time for action is now. Warm words alone are not enough to keep consumers from the cold this winter.

Yours sincerely,

Richard Lloyd, Which? Executive Director

63 comments

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Jan

I agree that an urgent review of energy prices is essential. However in the meantime I would urge everyone to insist on having a smart meter installed, as we did nearly a year ago by Eon. Our monthly DD was about to increase to over £200 but since the smart metre arrived it is currently only £140! I didn’t think we were especially wasteful but think about it – what else do you buy that you don’t know the price you’ll have to pay for it until 3 or sometimes 6 months later? We now know quickly and easily what we spend on gas and electricity EVERY day – and a traffic light system warns when our consumption is high. And the best bit is that if everyone reduces consumption by even a small amount the energy companies will suddenly have spare capacity and may have to reduce prices to attract more custom. Like the banks we need to hit these greedy companies where it hurts most – customer numbers and sales turnover!

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wavechange

I’m not convinced that we need smart meters or traffic light systems to warn us when we are using too much energy. Looking at your costs, I think you have further opportunities to save energy.

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Dave D

Smart Meters do nothing at all to save energy and only very naive consumers will “learn” how to save using one compared to existing metering.

However. Smart Meters WILL cost all users and tax payers Billions of £ to implement, will restrict the ability to switch suppliers even further and have insidious and potentially very dangerous flaws built into them.

Smart Meters are not, and can never be, the solution to saving energy or reducing your bills.

As for £140 DD per month for dual fuel – that seems like a hell of a lot of gas and electricity compared to the National Average. Possibly very good for your household but hardly a ringing endorsement for Smart Meters I’m afraid.

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william

@Dave D, Smart Meters will only cost customers money, as the energy companies are being made to fund it themselves ( thru what they charge us ), I don’t think there’s any extra Government money in it for them.

And if anything it should make switching easier, if not no change, as part of the reason it hasn’t happened yet is all the companies have to agree on the same model of meter. So part of the issue with price rises is possibly down to energy companies have spent money training their “sales staff” to install their own preferred meter, which is 99% probability not the one they’ll end up with.

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Dave D

Sadly as yet there is no legislative obligation for a single standard of SM to be used and there is a government commitment to fund the SM programme. See convos on SM’s for plenty of details.
Crucially , though, SM’s cannot possibly help us to reduce our bills (unless you count the fact that they will all be capable of disconnecting our gas and elec without warning which I suppose could count as some sort of enforced saving)

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william

And of course once the SM roll out starts, I’m betting the number of distraction burglaries will rocket. “Hello Sir/Madam, We’re here to install you’re new meters, can you show my mate to the Gas meter while I pretend to work on the leccy one…”

Hello – re smart meters

They could help people control their energy use and it’s great that you have saved money. There are a few things to think about re smart meters.

Most smart meters that are fitted at the moment are not likely to be fully spec, in terms of having the final agreed technical standards. This will mean that you will probably have to have another one installed before 2019. While this may not be too much inconvience, the more early ‘smart’ meters rolled-out which aren’t compliant, may push up the overall cost – which will come out of our bills.

Also, the cost on the monitor is not likely to be the accurate cost. Mine says ‘for illustration only’. Be careful not to rely on this figure if you are budgeting or making sure you are on the best deal. Which? is pushing for this figure to be accurate.

Good to hear your experience and keen to hear from anyone else.

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wavechange

I’m not sure how much use a smart meter is, but I am sure that they are not good value for money at the huge price estimated for installation across the UK.

I’m not going to turn off my fridge (except when I go on holiday, of course) and I’m not going to turn off the freezer. I don’t know how much electricity my gas central heating uses, but cost of gas is a bigger concern. Apart from lamps, which are marked with their power consumption, almost everything else is plugged in. I have can test the consumption of individual plug-in appliances using a simple plug in meter that cost £9.99. I know that appliances consume power in standby mode (and can measure how much), and that they consume no power if unplugged.

I have no objection to people having a smart meter but I think they should pay for it.

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Chris, Gloucester

Jenny,
I see “which” are sticking to their “party line” in support of the principle smart meters, although admittedly “which” does have concerns about the way the roll out may be conducted.

In a previous conversation I recall there was considerable opposition to these things. Opposition I feel “which” should take notice of and not only look at the way these things might be introduced and how much it might go over budget but if they are really a good idea at all.

I said it before, smart meters on their own won’t save anyone a penny. Any and all saving will come from our own actions. At £11 billion to roll out these things which we’ll all be paying for any “savings potential” (which I think would be very short lived if exist at all) would come at a very high price. If that £11 billion is available just think how much energy efficiency improvement could be made. Real savings.

I think “Which” should be looking hard at whether these things are really a good idea or not.

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Dave D

@ Jenny Driscoll and @ Chris, Gloucester.

Totally with Chris – Which? have acknowledged the mass opposition and also many of the issues such as the insecurity and the dangers (including as dramatic as explosions (gas) and death through medical equipment stopping (electric) inherent in the fact that SmartMeters are not actually meters at all, they are remote switching devices that happen to also register the energy used.

Any yet, despite all this, Which? chooses only to focus on the issue of the cost of the roll out.

That is very important, but it isn’t as important as people’s lives and safety, nor even as important as the fact that the mass public are being lied to (or at best, if you want to try to be generous) deceived – conned – into having their supplies placed completely in the control not just of the suppliers (who can’t be trusted) but hackers too.

It’s very similar to the Which? line on other issues which I keep banging on about such as supporting CFL lamps whilst (reluctantly at first) conceding that there are massive issues over reliability, light output, quality, safety and disposal, or insisting on telling us that modern appliances “cost less to run” or “use less energy” without saying THAN WHAT …. meaning that the mass public are idiotically buying new appliances which use more gas / electricity than theiur old, working appliances, because they don’t get told that the new ones only use less than other NEW appliances, but almost all use MORE than equivalent OLDER appliances.

Which? are not along but they need to get a grip and lead the way on exposing all these half-truths, untruths and incomplete stories.

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Chris, Gloucester

Dave D,

I appriciate your support for my comment on smart meters. That being that they are a momumental waste of money and that I’m very disappointed “Which” does not seem interested in really looking at whether they will really benefit us all to the tune of the £11 billion, and probably much more, which we’ll all end up paying a proportion of.

However my opposition to smart meters is only based on the economics. I don’t subscribe to the microwave health risk or have notions that big brother will be watching, or think the supply companies will we switching us on and off grid at will. I just think smart meters are technology for technologies sake, will not provide energy usage savings on anything like a long term basis, are therefore unnecessary, and a waste of money on a biblical scale.

Also, I’m not opposed to low energy lighting including CLF bulbs, although I would conceed most of the commonly available supermarket versions are rubbish. Good ones which work as well as the old incandesent bulbs are now available, and something like an 80% electricity saving (for lighting) is worthwhile, even if that saving is a small proportion of overall electicity usage.

Finally though I do agree that “Which” should be looking into issues more deeply as a result of feedback from the likes of those of us who offer a comment. It’s seems, as with smart meters, that after the first “policy” or “party line” opinion “Which” formulates nothing anyone has to say triggers any real rethink. Or is “Which” prepared to offer solid reason for keeping to their party line. The case of smart meters again springing to mind, where all we keep hearing is “we think they could help people control their energy use”
Well, I’d like a little more than that to justify “Which” support and the expendature of £11 billion, and probably more, of what will be our money.

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Catherine Cullen

I don’t think they care. Do energy companies provide Tory party funding? I’d guess at a yes there. Poor people die…less on the benefits bill.

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william

The energy market is mostly certainly broken. And its a shame you haven’t also included asking what plans are in place or will be in place in plenty of time, to avert the supposed energy shortfall around 2015.
Any review should also look into why switching is so problematical. I switched from one EDF tariff to another ( more expensive one, boo hiss ). That was 6 weeks ago and yet my account is still showing my old tariff which was supposed to be defunct as at the end of Sept 2012. To me, that’s just not good enough, how long does it take 1 person to type in a few numbers and click a couple of buttons. Sigh.

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Malcolm R

A smart meter may help some to monitor their usage – but it is still they who must make the savings, the meter won’t do it. I take a meter reading for gas and electricity each month and use a simple spreadsheet to monitor cost and to compare with predicted use (based on previous years). Either way you can spot unpleasant surprises.
I think a better understanding of how the energy market works would help these sorts of discussions. Just who owns the generating and gas facilities, and how do they charge the energy companies we deal with. Who owns the transmission grid and how is that cost charged out – and what do we pay for it. What do we pay for the Government’s green energy / CO2 emissions policy.
Who is going to be capable of harnessing the power of consumers to make changes? You would think that Which?Switch might get everyone migrating to the most competitive suppliers – if so that would have an effect on the others, wouldn’t it? But that clearly is not the case – inertia? Action needed, not words perhaps.

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Dean

Switching just delays the inevitable. Whilst it is good to play the energy companies off each other, you are simply moving to a company that will eventually put their prices up.

Wholesale prices rise and fall yet our prices only rise.

My solution would be to nationalise (hear me out) but in a way that meant the private company would provide all the admin/meter readings etc and yet the government retain a controlling stake in the company to ensure that the majority of the profits are used to bring prices down and reinvest in things like burst pipes.

It’s how the Germans and Dutch manage their railways

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Ian U.

The energy market is a complicated and (deliberately) confusing market. How many people will die as a result of the continuing rises?
I cynically believe that the price rises were delayed by a month so that the inflation percentage used for pensions rises next year etc would be lower and thus keep the government happy. I personally feel the government also knew about this.

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David Ramsay

Don’t be cynical, of course this was planned well in advance, look at british gas, special offer fix your prices until this time next year at no cost, so how are they able to do this if their costs are rising?

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Malcolm R

Nationalisation is unlikely to work – industries have not been well run in this way. And the Govt has many outsourced admin services now – mostly with disastrous results. They do not have the means nor the expertise to control outsourcing effectively.

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Dean

Part nationalise then. Let the private company run it, take a reasonable profit, yet the government holds a controlling stake. Kind of having your cake and eating it. Get the private companies to run it and yet the government can decide how profits are distributed.

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wavechange

All that is needed is proper regulation of energy companies. If that can be achieved it would be much cheaper than part-nationalisation. It’s not just price and profits that need to be sorted out. Which? is pushing for simple tariffs that are easy to compare. Ofgem should have done this years ago.

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Chris, Gloucester

Richard,
I would agree with almost everything you’ve said and I hope this open letter triggers some action, althgough I won’t be holding my breath.

My own feeling is that private ownership of UK energy supply is not working and this fundamental part of our infrastructure should return to public ownership, but not like in the bads old days. Nowadays nationalised energy supply if it were possible should have a strong independant overseeing body to ensure operational efficiency and fair pricing.

Of course re-nationalisation won’t be happening anytime soon even if there was a Govermental will to go that way (which there doesn’t seem to be) because there is no money to buy it back.
Thanks Maggie you did us up up like kippers big time, and sold the family silver just to bale us out of a previous recession.

At the next opportunity I’ll be voting for whichever candidate is pro re-nationalisation.

During Prime Minister’s questions earlier today David Cameron promised consumers that energy companies would be forced to offer the lowest tariff to their customers.

The Prime Minister said: ‘I can announce that we will be legislating so that energy companies have to give the lowest tariff to their customers.’

Which? executive director, Richard Lloyd, called the announcement a ‘big statement’ and a sign that the Prime Minister ‘acknowledges that competition in the energy retail market has failed’.

He added: ‘This is a big moment for consumers, but we must now see these words turned into action and see the detail from the government in the Energy Bill.’ http://www.which.co.uk/news/2012/10/energy-companies-forced-to-offer-cheapest-tariff-299730/

What do you think?

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william

Sadly all that means is they’ll probably just drop all bar one of their most expensive tariffs, thus penalising anyone who can be bothered to keep on top of which tariffs are better for them. I’d rather the government made the energy companies publish the wholesale price.

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Chris, Gloucester

“Which? executive director, Richard Lloyd, called the announcement a ‘big statement’ and a sign that the Prime Minister ‘acknowledges that competition in the energy retail market has failed’”
Well, I agree that competition in the energy retail market has failed, but I seriously doubt the PM thinks or acknowleges that. After all the whole mantra of the current Government is to back off and let private investment sort things out.

Just wait, what we’ll get is weasel words composed by some spin doctor and nothing will really change. For all our sakes, and especially the old and poor, we need to raise the profile higher and higher. Make it an election decider, then something will happen.

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william

Oh do I win a prize, looks like npower are doing exactly what I thought the energy companies would do.

http://www.moneysavingexpert.com/news/utilities/2013/08/npower-cuts-down-its-tariffs-but-kills-off-top-pick

I hate it when I can say told you so :(

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Malcolm R

Chris, whilst many will be as cynical as you are (myself included) we should wait a reasonable time to see just what the outcome is. And there is more to responsibly electing a government than just this one issue, surely.

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Chris, Gloucester

Malcolm R,
Yes of course there are other issues and I am prepared to give anyone a reasonable shot at sorting things out, but I do feel that any potential Government committed to actually doing something to sort out energy supply will also be prepared to address a good proportion of the other burning issues. Perhaps rediculous petrol and diesel duty, tax evasion by big corporations, economic growth, employment, the trains etc. etc.
When that party activist knocks on my door I’ll be asking plenty of searching questions about many issues including questions about the energy supply system. If I get the weasel words I’m expecting I’ll be making it clear what needs to be done if they want my vote.
Sadly I don’t really think anyone is going to step up to the plate and really there will be no one to vote for, but if we are ever to get change for the fairer and better we must keep trying, we must keep telling them.

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Malcolm R

Dave D raises the question of average usage (commenting on Jan’s DDR going from £140 to £200 per month). Ofgem publish (and employ) an annual usage for “a typical household with medium energy consumption” of Gas 16500 kWh and Electricity 3300 kWh. I calculate an annual bill for this of around £1150, or £96/mth. I don’t regard my household as excessively inefficient – double glazed, cavity insulation, 250mm loft insulation, thermostatic radiator valves, a new condensing boiler, CFLs. But I do like to be comfortably warm – 21C. Sadly my energy consumption well exceeds the “typical”. I would be interested to know how typical the Ofgem model is.

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Dave D

My house is a 1930′s semi, secondary double glazing in all rooms except, ironically, the one with the biggest bay window, no CWI (the construction method and aspect mean it is unsuitable), 33 year old gas boiler, using CFL’s in some lights, fluorescent tubes in the kitchen and incandescent bulbs in many lamps still, I have a 29 year old Washing machine (which has hot fill), a modern Miele dishwasher (with hot fill), approx 15 year old fridge and freezer, aquarium and 3 garden ponds with filtration units running all the time. My annual electricity consumption is the greater part of 1,000 units per year less than the 3,300 quoted by OfGEM and my annual gas bill (by the way, I cook by gas, bake dozens of cake each month for charity events and make about 500 christmas puddings each year for charity) comes in about around 12,000 kWh (it got up to almost 13,000 in the winter of 2010/2011). I don’t even consider myself to be an especially careful user, but I do refuse point blank to leave any appliance plugged in at the wall when it is not is in use and I try my very hardest never to buy an appliance that doesn’t have a “hard” on off switch.

By contrast, my neighbours had CWI fitted (and now have huge problems with damp), have uPVC double glazing throughout, have an energy savings trust recommended (and once-was Which? best buy) washer (cold fill), no dishwasher, an EST recommended silly American style fridge the size of a pantry, a SEDBUK A rated, Which? best buy gas boiler fitted 2 years ago and are self-confessed “gadget freaks” who I know leave most things on standby permanently, They like to crow about how energy conscious they are by having CFL’s and LED lights in every fitting.

Their electricity bill regular comes in at about £150 a month and their gas has been up to £700 in a single quarter (winter 2010 / 2011).

I don’t think the OfGEM figures are in the least bit representative of the great majority of households, but like any other AVERAGE, don’t forget that it only takes a very small number of super-low and super-high values to skew the average considerably.

Knowing how wantonly wasteful many people are of energy – like my neighbours with their dozens of gadgets on standby – and how meaningless the EST and Which? recommendations are for products that actually save energy, I guess that the OfGEM averages are skewed very high by households with every modern appliance and gadget that money can buy all consuming energy like there’s no tomorrow.

Just my thoughts ……….

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Alban Thurston

The fightback by UK’s consumers to break the power of the Big Six’s profit-export drive must be through much needed measures to simplify supply of local green energy. Priority grid access for 600-plus local energy co-operatives, plus community or municipal ownership of regional grids -, has cut wholesale electricity prices in Germany by a fifth since 2008, introducing genuine competition to Europe’s biggest market. Now German consumers buy 11 % of their electricity from truly independent suppliers; in the UK, it’s less than 1%. Transparent, time-limited subsidy, in the form of Feed-in-Tariffs, is Germany’s route to green self-sufficiency; meanwhile, our corporates prefer to sell us climate-busting Russian gas or Polish coal; an agency of the French state begs Whitehall for secret feather-bedding of ever-more costly nuclear. German politicians of all parties see their energy policy working well, in the interests of consumers, and the environment. In contrast, our politicians bend to lick the boots of overseas corporates’, bend their message to whatever audience they face, and elevate the interests of transnational companies above those of UK voters.

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Bryan

Energy companies keep making excuses for thier rising prices, but never give any reason for thier increased yearly profits. They should be made to return excess profit back to the consumer.

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themajor

The energy market was one of those egotistical flag waving policies from the old Conservative administration which got the boot in 1997 leaving the Labour Party to do nothing whatsover during their 13 years. How we had such wonderful but naive faith in our governments during those halcyon years of the last millennnium.

The real core to these problems is to think outside of box when placing a vote inside the ballot box, and remember that it is no good voting in the same way as ones old granny did as if this were the 1950′s rather than 2012. There are more just than three parties on most ballot papers by the way.

As for these much publicised smart meters, anyone can have an energy meter now to record ones energy consumption which utilizes a simple clamp on probe and battery power to operate a wireless link to a battery powered monitor which can be located almost anywhere where you can view it with ease. One does not require electrical knowledge to install these units but one must always be careful when placing ones fingers near any live wires or terminations.

It is true that these smart meter could provide the potential to modulate the price of electricity during the day such that it is high when industry (if we still have any) are using it, and the users at home are most likely to want it but low during the late evening and during the night and early morning.

However, this recent energy fiasco demonstrating how few are aware of what they are paying now together with an inability to change supplier out of some arcane fear does indicate that there is no way a diurnal varying price for electricity would be understood or utilized by most consumers.

The smart meter is likely to result in even more confusion and provide a magic box and opening for energy companies to bamboozle the customer even more than they already are.

However, at the end of the day and in the long term one really does get the governments one deserves, and if we in the UK we feel incapable of changing our energy suppliers and our bank even when we know we are being ripped off – do we really deserve any better?

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Jan

You all seem to have forgotten what is currently involved in obtaining meter readings! Lots of people – meter readers – driving around in vehicles, using fuel, polluting the environment, costing a fortune! In the long run smart meters are a much more efficient and environmentally friendly, as well as being useful to consumers in monitoring energy usage. As for who pays for them – well, who pays for hundreds of meter reader vehicles, staff and fuel? The cost of the meters should be offset against that saving. There should be no need to use this new cost as an excuse to increase energy prices. Sorry meter readers – that’s progress!

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william

I already do my bit to put meter readers out of a job, I submit mine online when asked. They still need to send a meter reader round once a year, and I can’t see that stopping with Smart Meters.

And as most people have access to a phone, there’s no reason why everyone can’t submit meter readings online or via a phone these days, one less reason for the expense of installing SMs.

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Dave D

Talk about Naive!

If anyone SERIOUSLY thinks that SmartMeters will ever provide a saving then they are sadly misguided. If anyone goes further and SERIOUSLY thinks any saving, if there was one, would be used to offset the cost of energy then they’re barking mad. And that’s before you account for the fact that the cost of installing them will be £billions more than the currently estimated (and ever-increasing) £11bn, which we will all end up paying for through increased taxation AND increased energy bills in order to maintain the energy companies profits.

As for meter readers, they will never be done away with because the energy companies will be having to send them round every year (or less) to “audit” the SmartMEters (just as they do in the USA) – because the SM’s will be unreliable, inaccurate but more to the point, continually challenged by consumers who don’t believe that the readings are correct.

The concept of a SmartMeter is attractive; the reality is wildly different

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David Ramsay

Agree with Dave D on this but would add that the real reason they are being pushed for now is the remote disconnect capability.

When the next set of power cuts come along they need to be able to selectively reduce the load, all they need do is instruct a few hundred thousand meters to switch off power, total and absolute stupidity.

Anyone who has one fitted voluntarily is barking mad. I have instructed my supplier that under no circumstances will they get access to my property to fit one. If I move I will ask the supplier (if a smart meter is fitted) to come round and replace it with a normal meter.

If they refuse,I will bypass the meter and remove it from my home – it’s my home not theirs!

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Malcolm R

William – absolutely right. Digital meters are a doddle to read. I check mine once a month and monitor usage that way – also keeps an eye on how my bill is growing so I can decide whether my DDR needs changing. A simple spreadsheet makes it more entertaining, but a pencil and paper are quite adequate.

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Barrie J

dear Mr Cameron
During this parliament you have shown yourself to be a man without substance, in other words you are all mouth and no trousers. Your energy policy seems to be without form or substance. If you want my vote next time for once in your political life live up to your public statements.
Curb the energy companies, they exist to generate profits for their shareholders. Normally competition would hold this desire in check, but not now they are effectively an oligopic monopoly.
You have said what you need to do, so show us you are not a whimp and do the deed, if you have the political will to act, but your record is not good in the “action area”!

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Arbut

Why can energy companies not price simply as follows:-
1. Standing charge to cover maintainace of supply, meter installation, etc. this charge would probably vary depending on the type and number of meters requested and installed.

Plus

2. Price per KwHr which may vary depending on how much power is used, with peak use being more expensive than off peak.

There could also be, within the above, variations for fixed term deals or Tracker type deals based on the wholesale price, similar to interest rates.

Less discounts for using the most efficient method of billing & payment, taking dual fuels and depending on the amount of credit taken.

This would enable companies to be able to compete, would be relatively simple for customers to compare tarrifs from different suppliers and would ensure that the most efficient suppliers gave the best prices. Furthermore it would mean that customers who took the most looking after paid the most making for a fair system. Currently energy companies are competing with themselves with so many different tarrifs from one supplier for the same service which must make for inefficiency within the company.

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Malcolm R

It’s a shame these discussions can degenerate into slagging off politicians which have no effect. The aim surely is to put sensible proposals together?
Incidentally, just what does happen to all these diverse and sensible comments and proposals? Does Which? collate and make use of them?

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wavechange

I have often wondered the same question, Malcolm. Bear in mind that you have granted Which? an exclusive licence to use your contributions, with or without credit. When I read about new Which? campaigns or look at their magazine, it seems clear that comments are being used where many people have supported the same view. It must be difficult for Which? staff to cope with us going off-topic so frequently. :-)

We have a few contributors whose main aim seems to be to find opportunities to publicly criticise politicians past and present. We cannot ignore politics, of course, but I do agree with you that it serves little useful purpose.

Hello Malcolm, your comments may appear in a comment round-up here on Which? Convo, or even in the magazine – but we’ll always credit you with your first name/alias. Your comments can also help us in our campaigns, so may appear in a dossier to show regulators/MPs.

Or we just read your comments to help our research and investigations – eg. comments made on Convo were the inspiration for our Fixed Means Fixed campaign to stop mid-contract mobile price rises. Comments here were used to let the Payments Council know that the time is not right to get rid of cheques. And so on. Hope that illuminates things a bit more :)

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Malcolm R

Thanks Patrick. I just wondered whether these conversations (nicer than convos?) were only that – an exchange of views – or whether Which? set them up to form the basis of more detailed investigations. I think that the way comments are made are influenced by the proposed use – many may put some real effort into researching before making a comment if there is a known serious objective; some of the comments demonstrate this and keep the discussion focussed. Maybe discussions where you are looking for serious proposals to be put forward could be labelled accordingly. Some do seem to invite criticism of politicians by the way the introduction is phrased.

Hello Malcolm, Which? Conversation (if that’s what you prefer!) can be a place for a light-hearted debate about consumer issues, or more serious. It really is up to you guys – we’ll make it clear when we’re specifically looking for help/evidence, though sometimes they can crop up anywhere.

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william

Hmm, not sure how biased this is, but I wonder if the Government are even looking at things like this here.

http://www.telegraph.co.uk/comment/9559656/Germanys-wind-power-chaos-should-be-a-warning-to-the-UK.html

Maybe that could have been added to the the letter to the PM.

And then there’s always http://www.telegraph.co.uk/comment/9622068/It-is-wind-power-that-will-send-our-bills-sky-high.html

I can’t work out if the Telegraph is anti government or anti green policies. They’re certainly anti saying things concisely.

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themajor

The big problem for the electricity supply industry has always been that an enormous amount of capital plant has to be made available for producing electricity when it is needed, and of course for the peak periods.

This means that a large amount of plant is lying around doing nothing or on tick-over for much of the day and Smart Meters do provide an opportunity for the supplier to modulate useage during those times when the capital plant is least used. As you will know the storage radiators achieve this to some extent, and many washing machines now come with internal time switches to start at the time one selects, and as such when the price could be cheapest of course.

There can be little doubt that the consumer would get use to using their high powered appliances should they be aware for example that it is much cheaper to start the dishwasher after 21:12 but costly to use in the early evening. There is a plethora of choices which could be used to enhance the better use of capital investment used in the electricity industry by inspiring the consumer with cheaper tariffs.

However, despite us being blessed with over 50 years of Which Magazine and the Consumer Association this nation is more “Rip Of Britain” than it was in earlier years and any use of modulating tarriffs based on time/day of the week etc would just be used by the Big Six suppliers to bamboozle the customer into a zombie like state such that the consumer never knew what they were paying. Rather like what we have today but on a large scale.

The answer is with our politicians of course and sadly not with the three main political parties which like our escalating energy prices all represent more of the same old thing.

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David Ramsay

Can you explain how these smart meters are going to ‘modulate’ usage?

They will be able to cut someone off and switch on again but they cannot vary the power being used. Indeed I would regard it highly dangerous if the meter could reduce the voltage or current (therefore) power used by a device since that may mean it operating outside tolerances and thus may cause damage to said device.

The only way ‘modulation’ could occur is if all devices in a home were under direct external control and for that to occur all devices would need to be replaced at vast waste, cost and ecological harm. It would also take several 10′s of years!

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themajor

The term modulate may not have been the best choice of word since those with electrical knowledge often think of something like FM, AM etc. It is used here in the sense that a cheaper tarriff comes into operation ie. 7.8 pence per kW – hr rather tha 15.2 pence per kW -hr not including the much hidden equivalent of a VAT charge.

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David Ramsay

In which case if the meters are smart they can dynamically switch between tariffs and suppliers always ensuring you are paying the minimum – some hope eh!

Lets face it the benefit is all on the supplier and none (possibly -ve) to the consumer.

I have reviewed the specs of the meters and more importantly the HID and find that after a standard warranty period the cost of replacement of the HID is down to the consumer.

Anyway I still don’t see the meter ‘modulating’ or switching anything, how is ‘the smart meter’ going to do the switching as suggested by you originally, you will have to take the action yourself and only if you have a HID that supplies you with tariff information

What, use the Internet I hear you say, a large number of people are NOT online and don’t want to be, why should they be disadvantaged ( remember those not online are those who the meter may help the most!) the Internet is not free.

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John Ward

A really smart meter would come out of the cupboard in the middle of the night and do the ironing for us.

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David Ramsay

A really smart meter would make sure we didn’t have to pay for the energy in the first place;-)

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Malcolm R

1. DECC estimate the cost of smart meters as £10 billion, with benefits of, I interpret, around 15-16 billion of which £6.4 billion wil “benefit consumers from reduced energy use and taking advantage of off- peak tariffs” (sorry if this has been said earlier). I don’t follow why it takes a smart meter for people to reduce their energy use – if anyone is interested in reducing energy they can monitor their use already and do what – apart from turning off appliances on standby? If you want to encourage off-peak use, other than the economy 7 time band the suppliers could simply publish the times of day when electricity would be best to use so you could maybe plan your dishwasher, washing machine, accordingly, but I doubt you will affect cooking, TV, kettle boiling will you. I may have missed the point of smart meters.
2. One real advantage of them could be that if they incorporate remote switching, if load has to be shed (a power cut), it could be done selectively, so that those dependent upon electricity could be kept on line – for example those using medical equipment at home, or vulnerable people totally dependent upon electric heating.
3. The argument that if you not online and don’t want to be you should not be disadvantaged keeps cropping up. If there are real advantages to the supplier by having online customers – paperless billing, for example – and if consumers can use it to find the best deal, then they should take advantage of it and benefit. The danger making effort unrewarded is what has damaged us in the past. “Going online” provides the means to save so much money – my dishwasher was £100 less than “retail” by searching online – why try to prevent this kind of initiative just because others “don’t want to”. Give it a try. But there are other equivalent methods to online – Which? publishes best buys and best sources with phone numbers.

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David Ramsay

3) perhaps the cost of the phone line, Internet access and computer equipment may be the barrier!

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Malcolm R

David – I readily accept some do not have internet access nor a computer – whether for cost or other reasons – but I pointed out you can use the phone instead, and most have phones. It is the attitude that because everyone does not have a facility, no one should benefit from having it, that I find so negative.

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grumpygit

After years of watching what used to be public utilities being bought out and controlled by foreign companies, who regularly post record profits prior to hoisting their British customers prices and whose prices for the same products are lower in other European countries, the time has come to take control of the situation and either force these companies to give the British fairer prices or to take the whole energy market back into government control.

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David Ramsay

I agree, let’s put them all back in public ownership without compensation, lets also allow mortgages to retain their homes without having to pay a single penny more.

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Kevin from Aldridge

Smart meters? Cheaper Tariffs? The whole thing is broken and our political masters do not care about the impacts. Our pensioners are in danger of freezing to death more than ever and an increasing number of people without adequate pensions will face fuel poverty and be in danger over the coming years. The UK has become impossible to live in due to the cost of living here. We need action…NOW!! Politicians must act for the people and not sit on the fence as we head towards a bleak future. Record profits for the utilities companies and a system where only the rich can afford to heat their homes adequately. Democracy is about acting on behalf of the people not squeezing us all for more money. Action required 1, Domestic energy strategy required 2,Re nationalise the Utility companies 3,Stop these above inflation increases, 4, Remove VAT, 5, Stop these Green Taxes. Lets vote in the next election for anyone other than the 3 main parties as they are all morally corrupt and undemocratic ie they do not work anymore in the best interests of the UK population. They see us as cash cows to fund their ridiculous overspending in other areas.

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David Ramsay

I am inclined to agree with you, however I think that the pensioner need can be covered quite simply by preventing any energy company from cutting off their supply regardless of ability to pay.

This should be enshrined in law.

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Malcolm R

Supply should not be disconnected before the circumstances are known, pensioner or not – there is a whole range of vulnerable people. Someone has to decide whether there is an unwillingness to pay, or an inability. This is probably the function of Social Services (?) who should then liaise with the consumer and the energy company to decide how the supply will be funded in future.

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David Ramsay

What a bit like ATOS and disabled eh!

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Malcolm R

No

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george

the gas and electric is eating our money like theres no tomorrow, and there know way out all the time the government is getting tax out of it I can not see it going down ,its one life for them driving around in expensive cars at our expense, I agree we need a review,

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Ammo

The government is not to be trusted, after all they are the instigtator of complex systems in order to confuse, which is an excellent way of extracting and penalsing the most. Corporate entities are very good at emulating these processes. In order to win your case, we must make the practise useless. I would reccomend a national non payment quarter arranged in protest, until an offer of a simpler, fairer system is agreed. Coporates loosing money is quite simply the easiest way to get what you want, thats the nature of capitalism. Are there any active protests in the UK, or are we genuinly all talk with no action ?

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