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The smart meter roll-out can’t just be an £11 billion calamity

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Profile photo of John Healey John Healey
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Last night John Healey, MP for Wentworth and Dearne, led a debate on smart meters in the House of Commons. He’s here to discuss his concerns with the government’s current plans for the roll-out.

Which? has been in touch with John about these concerns and passed on some of the comments you made on previous Conversations.

When Which? talked to me about the smart meter roll-out programme, it was an easy decision to put questions to this government on how it will make sure this billion-pound programme is cost-effective and delivers value for money. After all – all of us will end up footing the bill.

I believe that smart meters can help people control their energy use. I’ve listened to constituents in and around Rotherham complain about gas and electricity bills – smart meters bringing a stop to estimated bills will be a good result.

But right now this programme is costing us a lot of money. We might see benefits in the future, but those benefits could be tough to identify if the government doesn’t keep a tight control on the cost of actually getting the smart meters into our homes.

We must control smart roll-out costs

The priority right now has to be making sure that this £11 billion-pound programme is controlled so that it really ends up being worthwhile to everyone – not just the energy industry. Today, I’m just not convinced that this is happening.

I know that several people have left comments on Which? Conversation about their concerns around the smart meter roll-out. For me, I want to hear a lot more about how the government will guarantee that this roll-out will be co-ordinated and every penny spent will be scrutinised and publicised.

We should know what we’re paying for and be confident that industry spends our money wisely.

The government must listen to consumer concerns

For those who are critical of the roll-out, I think it is important that the government listens to your concerns rather than steaming ahead and letting energy companies install smart meters that most people don’t see the point of and many actively don’t want.

There needs to be much better communication around the smart meter roll-out, so that people understand what is happening – many of the benefits of smart meters will rely on people being more aware of their energy consumption.

We’ve seen the results of several national programmes – good and bad. This month we saw that Digital UK was successful in its switchover which was delivered after a pilot and carried out region by region. The government must learn from this and I urge Charles Hendry, the Energy Minister, to consider Which?’s call for a ‘stop and review’ of the smart meter roll-out.

The smart meter roll-out is just too big to fail and, especially when people are struggling to pay gas and electricity bills, the only responsible, ‘smart’ move is for the government to re-think this programme. This just cannot end up being a billion-pound calamity.

Which? Conversation provides guest spots to external contributors. This is from John Healey, MP for Wentworth and Dearne – all opinions expressed here are their own, not that of Which?

Comments
18
the energy badger says:
24 April 2012

Unfortunately, I think it is too late and the damage has already been done. The major problem is that there is no global standard for installations – which should have been clearly specified before the rollout began.

The sort of problem consumers will face (which is typical of the problem faced by people I’ve spoken to) is as follows:

– You sign up with Supplier A. They fit a smart meter in your home.
– After some time, Supplier A increases your tariff. You decide to shop around to look at what other suppliers have to offer. You decide to go with Supplier B, who are considerably cheaper.
– Supplier B says they are happy to take your supply on, however, they can’t supply the type of meter that has been installed. They offer to remove your smart meter and replace it with a ‘dumb’ meter (at a cost, of course).
– Not wanting to pay the extra charge and wondering why Supplier B wants to fit a dumb meter, you shop around some more. Supplier C says the same thing as Supplier B. Supplier D can supply the meter, but is only marginally cheaper than Supplier A, making it not worth the hassle of switching.

It just leaves people more disillusioned than they were before with the energy industry as a whole. Is safety an issue? Possibly. What about security? Potentially. But the bigger picture is much more to do with the lack of interoperability from supplier to supplier. It’s so poorly thought out. The problem is we are already in the midst of the rollout and what can we do? It’s too late to enforce a uniform standard.

Whilst I’m here, it is worth noting the quote attributed to Charles Hendry in this article – http://www.telegraph.co.uk/financialservices/utilities/Business-energy/9053100/Smart-meters-for-energy-to-be-voluntary.html – the quote being “We believe people will benefit from having smart meters. But we will not make them obligatory.”

So, is it full steam ahead or not?

@TheEnergyBadger

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Jenny Driscoll says:
24 April 2012

We are really keen to hear from anyone with a smart meter who has had problems switching. The suppliers are telling us that they can take on new customers with smart meters, but the meters may revert to being ‘dumb’ ie the traditional meter that will need to be read. While government is on ‘full steam ahead’, Which? is calling for a ‘stop and review’. Yes, have trials but stop installing early ‘smart’ meters, especially as we do not have the final technical specifications for the equipment yet.

At the moment it isn’t obligatory to have a smart meter. The government is saying that its ‘vision’ is for every home in Great Britain to have a smart meter by 2020.

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b.martin says:
24 April 2012

The roll-out of the new type of meter should cease until a positive engineering specification is published as a British Standard defining its accuracy and specific functions.
The meter should be confined to measuring the total cumulative energy consumed from time of putting into service as with the present meters. If it is decided that the meter can transmit readings of the energy consumed it shall be restricted to not more than one cumulative reading per month to the regional distribution company who shall then pass the reading to whoever is issuing the bill to the consumer. There shall be no means of remote adjustment to the time of transmission, changes if needed to be performed manually by adjustment of the control circuit within the meter. There shall be no remote facility to switch the supply on or off, at present if load shedding is needed it can be achieved without the need to individually switch any of the 22,000,000 plus domestic consumers. Remote switching will lead to someone for political idealistic reasons arbitrarily deciding when people will be allowed to use the energy supply.
The meters should only be provided by the regional distribution company and fitted by their own permanent employees, not by people employed by one of the many independant sellers of energy.
If people wish to monitor their current consumption let them provide their own monitor, in addition to the supply company meter, at their own expense, provided it is fitted by a competent technician approved by the regional distribution company.

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SteveBolter says:
24 April 2012

Which? itself seems to be confused itself. The latest Which? journal has a photograph of a primitive energy monitor in an article on smart meters.
What we need is a full specification of the meters that are being labelled Smart, and a definitive list of features that are needed to give the consumer maximum benefit.

Real smart meters reduce fuel costs by helping make maximum use of renewable energy and reducing the need for backup fossil fuel generation when renewable output is low.

There is no point in having a smart meter if its smart facilities are not used. Just to allow the consumer to monitor their own consumption and to transmit “one cumulative reading per month” does not require anything as sophisticated as a genuine smart meter.

A smart meter offers the consumer the option of tariffs which give cheap electricity when plenty of renewable energy is available and ideally offer a switching signal which the consumer can use to automatically switch certain circuits on and off according to the price on offer.

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Jenny Driscoll says:
24 April 2012

Point taken regarding the pictures and we have sent a note around to colleagues.

Jenny

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Dave says:
24 April 2012

b.martin has summed up my views 100% accurately.

I hope that John Healey MP is successful in getting the government to put the brakes on this plan, though I am not confident.

It IS too big to fail but if it goes ahead at present it WILL fail.

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Chris, Gloucester says:
28 April 2012

“It isn’t obligatory to have a smart meter” well, at the moment at least. Which is good news because I see very little if any benefit to the consumer, that is certainly not £11 billion worth anyway. and I don’t want one. However by electing not to have a so called “smart meter” I doubt I will escape paying a proportion of the installation cost.
I think smart meters are a waste of money on an almost biblical scale. If that £11 billion that consumers will be charged was spent subsidising improvements like insulation the savings in energy consumed would be far far greater.
But as it is this very mis-guided initiative has taken on such momentum it’s going to happen, otherwise someone in Government gets egg on their face and they won’t allow that.
Even the “which” position greatly disappoints me. “Which” talks about controlling roll out costs and ensuring the operation is correctly co-ordinated with no additional sales pressure etc. etc.
But there is no “Which” comment about whether going ahead is really a good idea? Whether it’s an option to simply cancel the whole thing? Whether better enegy efficiency could be achieved by using such a vast sum of money to subsidise home energy efficiency improvements?

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Jenny Driscoll says:
3 May 2012

Hello, we do think that smart meters can benefit consumers in delivering accurate bills and helping them manage their energy. However, we do not believe that the Government has put together the best plan to roll-out these new meters so that at the end of the day this programme is cost-effective and really does benefit energy customers. We have challenged the Government on allowing energy suppliers to lead the programme, particularly on giving the green light for so many early smart meters to be fitted in people’s homes before the technical specifications have been agreed. Which? also believes that the Government should re-consider a regional plan for installing smart meters.

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wavechange says:
3 May 2012

Jenny
In these days of rising prices anything that can help customers keep track of what they are spending on energy is welcome, but there are cheaper alternatives to smart meters.

When I am asked for meter readings by e.on I type them in to their website and the bill is calculated promptly. It would not be difficult for energy suppliers to allow their customers to check what they have used – at time and not just when a bill is due. For those who do not use computers, an automated telephone service could be provided, with help for anyone who has problems in using this.

I know that there could be other benefits of smart meters, but £11 billion is rather too much to pay and there are some drawbacks that have been pointed out on previous Conversations.

Just because we have the technological capability to do things it does not mean that we should.

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Chris, Gloucester says:
8 May 2012

“we do think that smart meters can benefit consumers in delivering accurate bills and helping them manage their energy”?
Well Jenny, on that comment we’re going to have to agree to differ.
Remember we’re talking about £11 billion. Now even if these metres “can benefit consumers in delivering accurate bills and helping them manage their energy” what will be the payback period on £11 billion? I think rather a long time if ever.
It is my belief that equal saving could be made by consumers by simply monitoring their energy using existing methods and those that don’t do this won’t do it with a smart meter installed so where is the “greater benefit”?
I stick by my earlier comment “a waste of money on a biblical scale”. And worse still a waste of £11 billion that could have made a very significant improvement to overall home energy efficiency through subsidised improvement measures.

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anon the mouse says:
29 April 2012

There were a few more points to the Smart Meter. Now it’s just about costs, almost like they are hiding the big brother elements.

Initially there was the talk about Energy companies being to remotely disable your appliances if they were struggling with supply. So if you want to run your washing machine during the Corrie break then tough as everyone is boiling kettles and so your appliance is disabled.

Can we switch supplier as quick as the updates are sent? So if EON is cheaper at 9am but British Gas is cheaper between 9.01am and 9.07am then switch to them for that period. That would be smart and useful. I fear what will actually happen is that they will all set their prices to be identical.

Also how often are updates sent? What I have seen suggests 5-10 seconds is the norm. At that level of access it is possible to see which channel you are watching.

Most important, what level of connectivity and security do the meters have? Wifi/powerline ethernet/rfid? WEP/WPA/SSA/PGP/OTP/None?
I would suspect a powerline ethernet with no encryption to keep costs as low as possible, in which case using an adapter would be enough to turn your neighbours power off, maybe even entire suburbs or towns if the subnet is large enough.

I am a huge technophile (just check my comments on here out). Yet I would never consent to these meters without being able to turn it back into a dumb meter if I choose.

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Employee says:
4 May 2012

I have worked for 7 years for a company who installs ‘dumb’ meters and ‘Smart’ meters for all the big utility companies all over the country, and one problem is, the govt not yet giving their ruling on what should be the ‘standard’ of a Smart meter.

Currently, most utility companies are using different meters to each other, and some have hidden costs which are not always apparent when you sign up. Having had your meter installed, If you choose to switch from one Smart supplier to another, you would most likely have to have your meter removed and replaced with a new one; which would be compatible with your new supplier’s computer system. Plus there may a cost involved if you decide to switch within 12 months.

Some meter’s in-house display units, show you your gas and electric usage, and carbon emission; others only show you electric usage, and for the rest of your usage, you have to log onto your account to view this. (you may have to your use electricity to do this obviously)

It is not the law, yet, to have a Smart meter installed…so my advise is, currently to sit tight and wait for the govt to decide what they deem as a ‘required standard’; and when they do, unfortunately, I can envisage most of what is already out there, having to be changed.

In the meantime, be energy efficient….be aware of your usage. Don’t leave TV, comps on standby, at av. £30 per year, per item; use energy efficient bulbs. Let’s do what we should have always been doing anyway.

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Jenny Driscoll says:
8 May 2012

Thanks so much for contacting us, it’s very useful to hear first-hand experience of installing smart meters. We are really concerned about the costs of suppliers installing different meters early. Please do keep in touch, it would be great to discuss further.
Best wishes

Jenny

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Dave D says:
9 May 2012

Will Which? (represented here by Jenny) NOW, Finally, admit that Smart Meters are NOT a good plan, NOT good value and NOT going to benefit consumers?

And if Which? does finally admit this, WHEN will they start to campaign FOR the consumer by lobbying the Government to ABANDON this ludicrous waste of £11bn (and rising)?

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Nikki Whiteman says:
25 May 2012

Just fyi, there’s a DECC webchat about smart meters happening on Monday afternoon – you can submit questions to their team from today. http://www.decc.gov.uk/en/content/cms/news/sm_webchat/sm_webchat.aspx

Thought I’d add the link in case you want to put any of your questions about smart metering directly to the team.

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Jenny Driscoll says:
28 May 2012

Just checked the DECC website and questions are already being submitted – including some from Which? Convo regulars. Here’s the link if you’re interested – http://www.decc.gov.uk/en/content/cms/news/sm_webchat/sm_webchat.aspx

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wavechange says:
28 May 2012

I have just read one of the comments posted on this webchat, from someone who is convened that a smart meter could harm his health or interfere with his mobile broadband. Anyone concerned about radio-frequency radiation should not be using mobile broadband, mobile phones, cordless phones, microwave ovens and various other domestic items.

The cost of the smart meter rollout is a clear enough reason not to install them, unless individuals want one and are prepared to pay for it.

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steve megyery says:
14 June 2012

Well Mr Healey you highlighted the problem of consumer confidence. Pointing to the digital switchover as an example of good practice.
I work for Arqiva, the company who managed to carry out digital switchover on time and on budget. In my opinion you could do a lot worse than lobbying for Arqiva’s consortium (SmartReach) to gain some if not all 3 of the contracts available.
Our company has proven that it has the capability to carry out a uk-wide rollout of this scale, completely successfully, so why take a chance by giving the contract to others?

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