Is the new meter scheme really that smart?

National Right to Fuel Campaign Smart Meter Report Launch and Stakeholder Event:

Smart meters may not sound like the sexiest political issue, view but £12billion of investment is finally generating some hard questions in Westminster, says Steve Barwick.

The National Right to Fuel Campaign hosted a well attended, early morning, roundtable session on the 6th December that allowed key stakeholders to put under the microscope plans to roll out smart energy meters to 25 million households at a cost of £12 billion.

The first, and possibly the only easy, question was – who will pay? Answer? You. The investment, which dwarfs the proposed £1.3billion expenditure on insulation and indeed the north sea gas retrofitting in the seventies, will be recouped through additions to customers’ bills. Exactly how much – and when – was less clear.

It was also not clear precisely what the purpose is. It will certainly herald the introduction of ‘time of use’ tarrifs so that the customer pays more when energy is in high demand and less at other times, with the idea being that users who are aware of their usage (through an in-house display) will reduce it and/or switch supplier.

Yet a number of contributors suggested that if the goal is a reduction in usage and, potentially, the bills for those in fuel poverty, then there may be more cost effective ways of delivering those results. Others – for example Which? – claim that pilot schemes have shown that there is still an argument with regards to what will be shown on in-house displays – just the price per unit or the balance left in their account?

Against a background of rising fuel poverty – well explained by UNISON’s Mike Jeram, who reported that 25% of all households are now technically fuel poor and that a 1% increase in energy prices would bring another 60,000 households into that definition – a DECC senior civil servant stated that Government is committed to all benefitting from the smart meter roll out, including the fuel poor such as those currently on prepayment meters.

National Energy Action raised questions regarding ‘switching’ suppliers, which they suggest cannot be the principal policy of the Government when it comes to helping people with energy bills. It was also pointed out that 48% of current switchers actually end up with a higher tarrif.

NPower highlighted the scale of the task. To fit two meters plus an inhouse display and communication system as well as explain the process to the householder will probably take 90 minutes if there are no complications. One study has suggested that there could, however, be complications in up to 22% of households.

It is clear that, in order to benefit, many people in fuel poverty will need support and Consumer Focus suggested an ‘Extra Help’ scheme for vulnerable customers. It is equally clear that there is a long way to go in this debate but the audience endorsed the report published today – along with its seven recommendations – as a useful contribution to an important debate that is really only just starting.

The following Blog can be found at http://www.connectpa.co.uk/intelligence/smart.html

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