/ Home & Energy

The Government must urgently cut smart meter roll-out costs

Energy meter

Have you had a smart meter installed in your house? The official roll-out’s due to start next year, but we’re concerned about the £10.9bn cost. That’s why we’re calling on the Government to urgently cut costs.

A number of energy suppliers, including British Gas and Eon, have already started installing millions of smart meters up and down the country. However, the full roll-out won’t begin until the end of 2015. If everything goes to plan, we’ll all have gas and electricity smart meters in our homes by 2020. But, with you and me footing the bill, what’s being done to ensure we’re getting value for money?

We’ve previously called on the Government to pause the smart meter roll-out so that costs could be properly assessed. The roll-out was delayed for year. But now that the programme’s set to begin in earnest in December 2015, we’re calling on the Government to do all it can to cut the costs that will ultimately end up on your energy bill.

Three ways to cut smart meter costs

Today we wrote to the Energy Secretary, Ed Davey, ahead of his speech at the Liberal Democrat Party Conference, to make him seriously consider cost cutting measures.

The Government says that competition between suppliers will keep costs down, but with the energy market undergoing a full scale investigation by the Competition and Markets Authority, we’re not convinced.

So, as part of our Fix the Big Six campaign, we have identified three ways in which savings can be made:

1. The Government should explore using economies of scale to drive down costs. The meters themselves are one of the biggest costs for the roll-out, yet suppliers are currently buying meters separately. A centralised approach could save hundreds of millions of pounds.

2. A coordinated approach to the installation of meters in multi-occupancy buildings, such as flats, is required to reduce disruption and cost. Otherwise, there could be an unnecessary duplication of effort and costs, with visits from multiple suppliers.

3. Suppliers are required to take ‘all reasonable steps’ to install meters in every home by 2020, but it hasn’t been made clear what this means. Suppliers need early guidance from Ofgem on what lengths they have to go to so that they can improve the efficiency of the roll-out and avoid disproportionate costs.

Get smart on smart meters

Smart meters can be a very good thing, giving you more accurate billing and control over the energy you use. But that doesn’t mean we should be writing a blank cheque to have them installed in our homes. The Government, energy suppliers and Ofgem must get to grips with the smart meter programme to ensure we’re not paying over the odds. Otherwise it’s in danger of spiralling out of control.

Have you had a smart meter installed? Has it led to more accurate bills, or made you think twice about how much energy you use?

Comments
Dave Rumley says:
24 October 2014

I do not have a smart meter but about four and a half yeas ago N Power supplied me with a meter that fits in the meter box and is connected by a band around the main cable coming in, which in turn gives me a reading on a dial that is plugged into the mains. This shows me what power is being used at any one time, and will give me a daily reading and a weekly reading. The only was that it is useful is that i can see at a glance if it using more than i think it should be, which usualy means I have left a light on. I am using Utility warehouse for my gas and electricity supply, and about the last day of each month e-mail my meter readings and the end of the next month, by D/D I pay for what I have used only and no more. It could not be more simple.

Chris says:
24 October 2014

I’ve followed with interest the debate about having a smart meter or not and found the Which? video about this most interesting, all the more so because it featured First Utility, my supplier. They contacted me in Aug 2014 to say they wanted to install an electricity smart meter in my home!
With the video in mind I changed my initial thought of refusing the device and agreed to an install on 15th Aug.
I have two points to emphasise – firstly, don’t expect a IHD (in home display) with your new smart meter because neither First Utility or Siemens the supplier installer acting for them will supply the device. Go buy your own is the message ! ! !
Secondly, you may not even end up with a smart meter being installed ! The installation engineers (2 of them) tested the mobile phone signal strength at my meter box position and declared it insufficient to maintain a reliable connection.
The outcome is I have a lovely new DUMB meter. I’m starting at zero again on the new meter which means all the consumption data on ‘My Account’ with First Utility has vanished. !!!!!

So much for the roll-out of smart meters to all homes by 2020. And how annoyed am I going to feel watching my bills rise by the suggested £200 to fund the cost of smart meters for everyone else who can have one and benefit from it.

Governments, grand schemes and technology – don’t you just love it !!!!!

VanessaWG says:
26 October 2014

As a householder, I am worried about cost of smart meters being passed onto consumers, but as a mother of young children I am more concerned about health effects. There is evidence from the US, Canada and other countries that smart meters emit 140 -800 times the radiation that mobile phones do. Many class action cases have been taken out in the US by people claiming that health problems started only when smart meters were attached to their homes. It is important to avoid quack medicine and unproven claims,but anecotal evidence of harm coming from so many ordinary citizens already exposed to these meters surely merits examining further?

If they are without risk to health, then the smart meter companies should be prepared to sign an affidavit to each householder receiving one, to say that they are safe and that if subsequent health problems are reasonably linked with exposure to emissions from smart meters, that they will compensate families financially. I bet that would end the smart meter roll out overnight!

There is no way that I will accept a smart meter in my home – and a final point, if they are so good then why have most European countries, after examining the pros and cons, decided AGAINST using them?!

@Vanessa

As far as I’m aware, all properly conducted scientific studies have not shown that there is a risk from smart meters. If you have a link to that evidence from the US and Canada, please provide it so we can look at it.

There are also no credible claims of electrosensitivity, but what there has been is a lot of scaremongering.

VanessaWG says:
26 October 2014

To flip your argument on its head, Alan, rather than prove they are dangerous, how about we employ the precautionary principle and first prove that they are SAFE?! The fact is that smart meters are a new form of technology and largely untested so anyone who tells you they are safe doesn’t [yet] have scientific proof of this and in the Uk at least, a ‘suck it and see’ mentality seems to be driving the debate. By contrast, there is a growing body of proof and scientific evidence of damage to health caused by exposure to RF/MW radiation, see these links for more information:

http://stopsmartmeters.org.uk/live-blood-analysis-observable-effects-of-rfmw-radiation-from-smart-meter/

http://stopsmartmeters.org.uk/there-is-no-justification-for-the-statement-that-smart-meters-are-safe-dr-david-carpenter/

Yes, we could, Vanessa. Will you employ the precautionary principle and give up using your PC until someone proves it is safe?

Dark-field blood microscopy is unscientific quackery.

Do you have any good evidence?

David says:
26 October 2014

The major difference, as far as I can see, is that Vanessa’s PC is proven to be very useful and is established technology used by billions, whereas smart meters appear to just cost a lot and have so far proven next to useless.

As I understand it, smart meters use a gsm data connection. This is what mobile phones use for text messages. It would appear that a smart meter is as safe as a mobile phone (and there is no good evidence of any health issues from them).

It may or may not be full of facts, but the danger of sites like stopsmartmeters is they look for all the world like the screamy tinfoil hat panic sites that appeal to the perpetually scared or outraged, sent up so well by the likes of DHMO.org

The fact is there are plenty of very easily justifiable reasons to want to avoid or refuse smart meters, most of which have already been noted above, without having to resort to fearmongering-style techniques.

Alan wrote: “It would appear that a smart meter is as safe as a mobile phone (and there is no good evidence of any health issues from them).”

The big difference is that a mobile phone is generally used near the head whereas a smart meter is some distance away. Thanks to the inverse square law, the intensity of radiation from a phone will be much greater.

I totally agree with your view about scaremongering and misuse of science. The cost of the smart meter roll out is unquestionable and should enough on its own to stop the waste of money.

A good point about the distance, wavechange!

No idea why I’ve not done it before, but just checked what your QR code is… 🙂

Twiglet21 says:
27 October 2014

I was offered a smart-meter by British Gas in October 2011. I had just installed a solar PV system on my house and informed British Gas of this and asked them to check if their smart-meter works with Solar PV systems, I was told yes, their smart-meters were designed to work with solar panels. Roll forward to February 2012 when British Gas arrived to install the smart-meter. I informed the British Gas ‘electrician’ that I had solar panels and showed him the isolation switches and generation meter. He immediately started scratching his head, rang HQ and promptly announced I couldn’t have a smart meter as the British Gas models don’t work with solar PV installations. I’ve not heard any more about smart-meters from British Gas since then.

I also subsequently found out that if you do have a smart-meter fitted, your electricity supplier then stops paying the supplier payments for electricity supply back to the grid from your solar panels. This is only a small amount as you get about 3p/kwH from your supplier but does show that as they get real generation / supply data rather than assumed data, there is an impact. This will have a small overall impact on the ROI for solar PV investments.

Jobs for meter readers will go, along with the income tax and NI they pay. Are these jobs being replaced by people in the UK manufacturing smart meters?

Whitwams says:
30 October 2014

We should all be very concerned about smart meters and Which should review its support for the conception which is aimed at smoothing out national energy use through the day. When I left school in 1953 I worked in a small textile plant which had a conventional three phase meters used in association with maximum demand indicators. When the maximum demand rose to X amperes, the price of each kW (kVA) trebled and the works owner switched off the big motors and as we were paid on piece work, our pay stopped. Domestic consumers were subject to rota`d disconnections to stop the distribution network from crashing. Families returning to cold homes on winter evenings had no light, cooking or radios and the scale of deprivation had to be experienced to be understood. These were the post war years when the country was re-building the generating/supply capacity and distribution networks which had been devastated by the lack of investment* between WW1 and WW2 and WW2 itself. By 1990, the system achieved secure and affordable supplies. The privatization of the gas and electricity industries has imposed the present situation where foreign investors – AND GOVERNMENTS – own our networks and demand profits which hitherto were re-invested. This privatization was to have protected consumers from exploitation by the use of statute and regulation. In practice, the owners have operated cartels similar to the oil industry and which have been imported from the USA where such skills have defied all attempts break up. The introduction of smart meters will enable suppliers to apply prohibitive prices when they have failed to provide the generating and supply and distribution capacity. It heralds a marketing utopia where demand can be adjusted to suit supply. Why should suppliers bother to forecast, plan and *invest when demand can be throttled. And all of this will be agreeable to a government besotted by the absurd fiction of renewable energy from the winds and tides which are available for only 30% of the time. I beg you to stop supporting (“educate consumers” ! ) the Government`s introduction of smart meters and please warn consumers of the cost implications; I wish your organisation best success in getting the regulator to break the oil industry cartel that has resulted in the situation that the October 2013 Which magazine reports.

As there are probably millions of homes that do not have an adequate mobile phone signal (including mine unless they intend to hang the smart meter out of the window) what are they going to do about it and would this be an additional cost.

I presume that the house wiring acts as an aerial, but that’s just a guess.

There are still too many unanswered questions wavechange.

Whitwams says:
3 November 2014

Radio controlled timeswitches are activated on a long wave frequency

If we need more mobile phone coverage to enable smart meters to work, how will this affect our bee population?

It appears mobile phone radiation could be killing our bees.

Do we need areas with no coverage to allow bees to thrive?

Would a single national mobile network grid used by all mobile network companies create less microwave radiation overall and would our bees still be able to thrive?

@alfa

Is there any good evidence mobile phone transmissions affect bees? This looks like one of those scare stories that conspiracy theorists like to spread around, usually either mis-interpreting a study, the results of a small and poorly conducted trial or extrapolated way beyond what is reasonable – the Internet is full of them.

After only a quick look, the best source I can see is the US Agricultural Research Department:

http://www.ars.usda.gov/News/docs.htm?docid=15572#phones

“Cell Phones and CCD [Colony Collapse Disorder]

Despite a great deal of attention having been paid to the idea, neither cell phones nor cell phone towers have been shown to have any connection to CCD or poor honey bee health.

Originally, the idea was provoked by the media making a connection between CCD and a very small study done in Germany. But that study looked at whether a particular type of base station for cordless phones could affect honey bee homing systems. However, despite all the attention that this study has received, the base station has nothing to do with CCD. Stefan Kimmel, the researcher who conducted the study and wrote the paper, e-mailed The Associated Press to say that there is “no link between our tiny little study and the CCD-phenomenon … Anything else said or written is a lie.”

In addition, apiaries are often located in rural areas, where cell phone coverage can be spotty. This makes cell phones or cell towers unlikely culprits.”

The decline in the number of bees is worrying and I expect that it is a combination of reasons – synergistic effect. I was hoping that Alan would post a reply, and I agree with his opinion.

There are many reasons for objecting to the roll-out of smart meters but the large cost is a good enough reason on its own. If we present more tenuous reasons then I believe we weaken the case.

From Institute of Science in Society i-sys dot org dot.uk MobilePhonesVanishingBees:

Researchers at Landau University in Germany designed a simple experiment for students on the Environmental Science course [3]. Eight mini-hives, each with approximately 8 000 bees were set up for the experiment. Four of them were equipped with a DECT (Digital Enhanced Cordless Telecommunication)-station at the bottom of the hive, and the other four without the DECT-station served as controls.

At the entrance of each hive, a transparent plastic tube enabled the experimenters to watch the marked bees entering and leaving the hive, so they can be counted and their time of return after release recorded for a period of 45 minutes.

The experimenters also studied building behaviour by measuring the area of the honeycomb and its weight.

In the course of the experiment, three colonies exposed to mobile phone radiation and one non-exposed control colony broke down. The total weights of the honeycombs in all colonies, including those at the time of breakdown were compared. The controls weighed 1 326g, while those exposed to the DECT-stations weighed only 1 045g, a difference of 21 percent. The total area of the honeycomb in the controls was 2 500, compared to just 2050 in the exposed hives.

But it was the number of returning bees and their returning times that were vastly different. For two control hives, 16 out of 25 bees returned in 45 minutes. For the two microwave-exposed hives, however, no bees at all returned to one hive, and only six returned to the other.
(This experiment was done after the one done by graduate student Stevan Kimmel)

Excerpt from a Letter to Beekeepers and Beekeper Associations by Prof. Dr. Karl Richter:
“Today, however, this natural information and function system of humans, animals
and plants becomes superimposed by a never before existing density and intensity of
artificial magnetic, electric and electromagnetic fields of numerous mobile and
communication radio technologies. The consequences repeatedly predicted over many
decades by the critics of this development should now no longer be overlooked. Bees
and other insects disappear, birds avoid certain places and are disorientated in other
places. Man suffers from malfunctions and diseases; and as these become hereditary,
passes them on as damages to the next generation.’

There are sufficient publications on microwave radiation, etc. and declining bees that suggest we should not just dismiss it. Yes, more experiments need to be carried out, but can we afford to be complacent?

alfa

There is so much wrong with that, but the main problem is that it an opinion piece on a website that mentions some study or other, but doesn’t link to it. As reported, it is very poor science for all sorts of reasons and certainly doesn’t reliably show that bees are in any way affected by mobile phones.

A Tuckey says:
2 November 2014

Our smart meter was installed (British Gas dual fuel) just under a year ago. The IHD stopped indicating gas consumption within 2 or 3 weeks – it continues to indicate LX. But our consumption is mainly gas. British Gas have been told 3 times but always simply express regret. To begin with they said they were working to correct the problem; no longer. Are we alone? They indicated it was a widespread flaw in their system. A Tuckey

Further to my post on 23.10 .2014, we have now received a written apology from Ovo Energy for sending intimidating correspondence regarding the necessity to have a smart meter installed. They have explained that our Siemens digital electricity meter does have to be replaced. We are told “It is past its expiry date”- even though it is only 14 years old. They have now clarified we can choose whether to have a smart meter or an ordinary meter. They also admit that if we change providers the smart meter may become an ordinary meter. Why did they not do this before? How many other of their customers are being mislead? How many other energy companies are up to the same tricks? Is this trickery government policy? Can we expect smart meters to last even shorter times? We are going to request an ordinary meter!

Here’s a site that offers some information on smart meters – albeit from a manufacturers’ association. It does give a view on radiatation (or lack of).

Dave N’s touched on a good point. How long can we expect smart meters and their home information display to last? Many electronic devices (phones, laptops, for example) have lives less than 10 years, and don’t live in cold damp meter boxes (my gas meter box is in-ground and floods in wet weather). According to Which? against a roll-out cost of £10.9bn the energy companies will save £8bn – over 18 years (plus the dubious £4.3bn suggested households will save). If the meters last less than 18 years then they will not pay back, but cost yet another eye-watering amount to replace – from you and me, of course.

There is no reason why a smart meter, properly designed and manufactured, shouldn’t last ten or twenty years even in adverse conditions. Consumer devices are frequently designed down to a price with long-term reliability somewhere down the list of priorities, but their lifespan shouldn’t be taken as a reliable indicator of the useful service life of a smart meter.

BTW, which site did you mean to link to?

Alan is right that well designed and protected electronic devices can be very reliable. On the other hand, they might soon become obsolete due to advances in software.

Alan, Too quick to send my post! Site follows (being Sunday it may take time to be approved).

Usually it is possible to get round the delay in approval by giving text that will allow others to use Google to find articles. It really annoys me that links to other Conversations and the Which? website must be approved. 🙁

Presumably it protects us from links that might do damage? Which?

Hi both – as Malcom said, we check the links to make sure they’re safe. As we look to make changes to the site, it will be one of the things we’ll work on so we can make posting as smooth as possible 🙂

Alan, sorry – this was the site. I could do with a smart brain.
http://www.nema.org/Technical/Pages/Smart-Meter-Facts.aspx

Smart meters should last 10 or 20 years – my point. At the bottom end, the 18 year figures are meaningless, at the top end are they really worth the trouble? Not in money terms in my view.

At present I believe that we will not be forced to have a smart meter installed. I suspect that this will be dealt with promptly by some means, such as charging customers more if they don’t have a smart meter.

You are right, but I believe you can still have a smart meter installed but ask for the smart features to be disabled – just becomes a dumb meter.

One possible future benefit will be the ability to be charged in half-hour slots. So those who bother could time some of their usage when electricity is cheaper – off peak. Timers on washers, driers, dishwashers for example if you trust them not to catch fire when you are asleep. No doubt their will then be a conversation that some people lose out by not taking advantage! But it would be one way to limit maximum demand, which drives the need for excess generating capacity.

I still maintain £10bn might be better spent on home insulation – reducing energy bills and saving generating capacity and gas. And investing in tidal power. According to one source a barrage on the Severn could cost up to £15bn to build and provide the equivalent of between 3 and 12 nuclear power stations..

I’m well aware that others have various concerns about installation of smart meters but I’m focusing on the cost of the roll-out, simply because that seems to be unequivocal. If we install smart meters that do no more than our existing meters, that would be an even bigger waste of money. 🙁

I agree that there are better ways to spend money.

We do not plan on having one as we heat by Oil and cook by bottled LPG. We are quite vigilant about using our electricity as we are on a limited income and do not see how one of these meters will benefit us.
My concern is if the energy companies plan on adding the cost to consumers bills will it just be a blanket charge which would mean we would end up paying a percentage anyway even if we don’t have on.

Ofgem’s published list – Gas Meter Reader Company Details 2014 – shows 57 companies presumably with significant numbers of staff to go round reading meters. Are all these going to be out of business when smart meters arrive? I wonder how much tax and NI the treasury will lose and whether this has been factored in to the costs

There are only two ways consumers can keep their energy costs down: switch to the supplier with the cheapest overall prices for your area (taking into account price per unit, daily standing charges, and any discounts offered, e.g. for managing your account entirely online), and SWITCH OFF everything that you don’t need switched on, to avoid wasting energy and having to pay for it! (That SHOULD be just plain common sense!) Having a smart meter installed (or one with a monitor which displays your current usage) won’t save you any more if you’re already using energy wisely (as confirmed by British Gas when I previously asked them why they were recommending an energy monitor).

The rollout of smart meters benefits the energy companies since the actual meter readings will be sent to them automatically, so they can cut costs by no longer employing real people to come round and read meters. These cost savings should be passed on to us, the consumers!

crispin says:
19 November 2014

Do smart meters need a power supply? If so, does it mean that if there is a power cut the gas will go off as well?

crispin, I don’t think the gas will go off but it does spark a thought – if, when you use gas you were to switch off your electricity would the gas used be recorded?

I suspect that if the roll out is costing £10b they’d have spend 5 mins making sure that wasn’t the case. But here’s hoping.

Maybe it’s a good reason for having gas and electricity from different suppliers so you can switch off the leccy.

Smart meters (whether for electricity or gas) require some power to be able to function, i.e. record energy usage and transmit the data to the supplier (e.g. via wireless transmission over mobile networks). The design of the meters will be such that they will continue to work from some form of internal battery backup during any power outage. The energy companies certainly won’t allow fuel to be used without being recorded during a power outage. For more info Google “how do smart meters work”.

simon h, re my comment I should perhaps have added “please do not try this at home”!

I have read today that the smart meter roll-out has been rolled back yet again because the required central communications system will not be in place before October 2016. I think there is now a decent opportunity for an about turn although substantial costs have already been committed.

That is good news. In the meantime, many of us can carry on providing our energy suppliers with meter readings on request.

I have absolutely no problem with smart meters if individuals want them and are prepared to pay for them.

One advantage of smart meters will be when you change energy tariffs, or energy suppliers. It is important that a meter rerading is taken on the day of the change – a smart meter will do this, whereas reliance on you taking it (and you may not know the date on which the actual change takes place) or an estimated reading is unsatisfactory. Is this worth £10.7 bn? The pay-back time has already been queried anway, so I doubt it.