What to watch out for before getting a smart meter

31 January 2018
Image

Smart meters are the energy gadgets being offered and installed in every household that wants one across England, Scotland and Wales by 2020.

By the end of the programme, which began in 2016, around 53 million smart meters will be fitted in over 30 million premises, according to the government – which is spearheading the scheme.

But providers, consumers and industry bodies have reported problems with the roll-out.

Moneywise explores what’s happened and looks at whether a smart meter is right for you.

The benefits

A smart meter is a tool (or tools if you have gas and electricity) you can have installed in your home – usually where your existing meters are – which sends automatic digital meter readings to your energy provider.

This means bills should be far more accurate than at present, when they are estimated, and it saves householders from having to submit their own meter readings.

On installation, you’ll receive an in-home display gadget detailing how much gas and electricity you’re using, as well as the cost. According to the government, this will help households to manage their energy usage better, save money, and reduce emissions.

Smart Energy GB – the company communicating the smart meter roll-out – adds that smart meters will enable households with prepayment meters to top up their energy online or over the phone rather than having to go to a shop (although they can continue to do this should they wish).

Another point to consider is that some suppliers are offering their cheapest average tariffs to customers who take out smart meters with them.

According to energy comparison site uSwitch, British Gas and First Utility’s cheapest tariffs are only available to households that already have a smart meter with them or to those who take out a smart meter with them. These tariffs cost £916 and £995 respectively per year.

However, while they are the cheapest average annual tariffs offered by these suppliers, they don’t beat the current cheapest deal on the market open to everyone, which is £807 from Outfox the Market.

There have also been some major issues with the smart meter programme. Here are the five key problems.

1. Not all households can get a smart meter to begin with

Moneywise spoke to 11 energy providers, including the Big Six. We found that some are installing smart meters to priority customers to begin with – such as to prepayment meter customers – while others are rolling out meters area by area, which means you may need to get in the queue.

Other providers exclude homes with prepayment meters or solar panels, although by 2020 every household will have to be offered a meter – see the table below for full details.

For example, SSE says: “Where customers need a prepayment meter, have two rate tariffs such as Economy 7 or a more unusual or complex meter, there may be a delay in getting a smart meter installed.” 

Smart meter roll-out is not so hot

2. You may lose smart connectivity if you switch providers

While you can switch energy suppliers if you have a smart meter, many meters installed to date won’t send meter readings to your new provider, which means you’ll have to revert to manual meter readings and estimated bills until the problem is resolved.

The issue is that most providers have only installed first-generation smart meters – known as SMETS1 meters – and some of these can’t connect to the national smart meter communications network run by the Data Community Company (DCC).

With British Gas, for example, SMETS1 meters will only continue to operate if you join from EDF, Scottish Power, Spark, SSE or The Co-operative Energy. Of the 11 providers we spoke to, only a few have begun trialling second-generation meters – known as SMETS2 – which will resolve this issue.

In fact, a written statement answered by Claire Perry MP, the minister of state for Business, Energy and Industrial Strategy (BEIS), on 1 February 2018 revealed that of the 450 SMETS2 meters installed and connected to the DCC, most of these are "being operated in test conditions" with only around 80 installed in a "live environment". 

In January 2018, the Department for BEIS extended the starting point from which SMETS2 (second generation meter) installations will count towards suppliers’ targets from 13 July to 5 October, due to providers not being ready.

A BEIS spokesperson says: “We have taken this step to ensure that customers can continue to feel the benefits of smart meters and suppliers can be completely ready to roll out SMETS2. This will not affect the rollout of the programme, or the 2020 final deadline.

“Smart meters are a vital upgrade to our energy infrastructure and millions of people are already benefiting from them. They will provide accurate bills and save consumers £300 million in 2020 alone.”

Prior to the government’s SMETS2 extension, a spokesperson for Octopus Energy told Moneywise: “We are concerned that there are so many SMETS1 meters installed in the UK, which aren’t interoperable, and not a very long time period for SMETS2 meters to be rolled out.”

Energy regulator Ofgem says the DCC is planning to connect all SMETS1 meters to the network by mid-2019, but in the meantime, you’ll have to revert to manual meter readings and estimated bills.

Robert Cheesewright, director of policy and communications at Smart Energy GB, explains: “You can speak to your new supplier ahead of switching to find out whether your smart meter will be affected, but rest assured that you’ll always be able to switch, and if you have experienced some loss of smart functionality when switching supplier, this will only be temporary.

"Earlier smart meters [SMETS1] will be enrolled into the national communications network over the air, without the need for a visit from an engineer.”

3. You may experience delays in getting a smart meter

Households keen to have a smart meter installed may experience delays. Renewable energy provider Green Energy explains that as it’s a small energy provider, it needs to ‘piggy-back’ off Big Six orders
for SMETS2 meters as it’s not cost- effective for manufacturers to supply the small number of meters it needs. Its chief executive, Doug Stewart, says he’s “hamstrung” by this reliance on larger companies making orders.

He explains: “There aren’t enough smart meters to go around and they’re slow to get hold of when you’re a smaller provider, plus there aren’t enough engineers to install them; we keep turning down customers. As an industry, I don’t think we’ve got a prayer of installing them by 2020.”

This worry of getting smart meters installed by 2020 is one echoed by other providers. British Gas’s parent company Centrica has labelled the government’s 2020 target as “ambitious”. In particular it warns that the government's proposed energy price cap may "seriously impact the smart meter roll-out", and "in a worst-case scenario, it could seriously slow or even halt progress".

Ovo Energy meanwhile has also labelled the government’s 2020 target as “ambitious”, although it adds that it's working hard to reach it.

A spokesperson for Scottish Power adds: “Due to the delays with the DCC becoming operational, the target dates will be a challenge for the whole industry.”

4. Energy bills may rise as a result

Centrica has called on the government to “address inefficiencies” in the programme to make it more cost-effective. It says the roll-out is “costly to implement” and adds “the equivalent of almost £40 on the bill of each Centrica customer”.

It also warns that forthcoming plans to cap energy bills could have “serious implications” for the smart meter programme, as it may result in there not being enough money to fund the rest of the roll-out.

5. Households pressured into to getting a smart meter

Households are being unfairly pressured into getting smart meters, according to complaints received by Citizens Advice, which runs the Chartered Trading Standards Institute (CTSI) helpline.

Issues seen by the CTSI include households being given so-called ‘deemed appointments’ – where suppliers say they’re coming to install smart meters without giving consumers a chance to opt out. 

Other complaints include communications about smart meters omitting the fact they’re not compulsory.

As a result, the CTSI has written a letter to industry body Energy UK asking it to remind suppliers not to give the impression to households that smart meters are obligatory. The organisation is concerned suppliers may be breaching the Consumer Protection from Unfair Trading Regulations 2008.

Steve Playle, lead office for energy at the CTSI told Moneywise: “The industry is under great pressure to install meters by the 2020 deadline, but they’re slipping behind, and as such, they’re finding more and more ‘interesting’ ways to get people to sign up.”

The CTSI has the power to launch criminal prosecutions against rule breakers.

Victoria MacGregor, director of energy at Citizens Advice adds: "We are concerned that some companies are using aggressive sales practices to install smart meters. People have come to Citizens Advice for help because their energy supplier has said they’ll force entry to install a smart meter, or told them that they are required to have one.

"Smart meters are not compulsory and customers shouldn't feel pressured to have one installed if they don't want one.

"We appreciate that suppliers are under pressure to install more smart meters but they have a responsibility to act reasonably towards their consumers and not to use misleading or aggressive sales practices."

Moneywise has also seen reports of such behavior by energy suppliers. One text we’ve seen, which was sent to an Npower customer who wishes to remain anonymous, said that the provider was due to install a smart meter without the customer requesting one, and without stating that the scheme isn’t compulsory or how to opt out.

The text message says: “Hello! We are due to attend your property on behalf of Npower to fit Smart meters on 30/01/2018. Please call us today on [number has been blanked out by Moneywise] to confirm or rearrange your appointment.”

On raising this with Npower, it told Moneywise: “While smart meters bring many benefits to consumers, they are not compulsory and customers are not forced to have one. Customers who are offered an appointment but don’t want a smart meter can contact us to cancel their appointment.

“This specific message relates to a reminder to the customers who have not confirmed, rescheduled or cancelled an existing appointment. These are sent via SMS or email as part of the follow up process.

“When the initial appointment communications are sent via the customer’s preferred channel, they are given options on how they respond to the proposed appointment date and time, including the option to cancel the appointment.”

However, while Npower says the message is a follow-up text, the reader is adamant that it was the first communication they’d received on smart meters. About a week later they did receive a follow-up email from Npower, which again Moneywise has seen. While this did contain more information about smart meters, again it only gave the customer the opportunity to ‘confirm’ or ‘change’ their appointment – not to cancel it. 

Other letters Moneywise has seen, which were sent to an E.on customer who wishes to remain anonymous, include the following statements: “Your meter is being phased out. Please go online or call us to book your appointment… We need to install smart meters in all homes as part of a nationwide upgrade programme.

“We need to change your meter… Your electricity meter is an old model that we need to replace with our free self-reading smart meter.”

Nowhere in either letter did it state that smart meters were not compulsory or how customers could opt out of having them installed.

When we put this to E.on, a spokesman told us: “We’re obliged to contact our customers about upgrading their classic meters with a new self-reading smart meter to support our commitment to Ofgem.

“While smart meters are not compulsory, we firmly believe smart meters offer a number of significant benefits for customers, including bringing an end to estimated bills and the ability to gain a greater understanding of their energy use which can help them lower their energy consumption. If a customer does not want a smart meter then they can contact us.”

E.on adds that if a customer needs a meter replaced for safety or legal reasons, they can opt for a classic meter instead of a smart meter.

When we raised this issue of customers being pressured into getting a smart meter with energy regulator Ofgem, it told us suppliers must treat customers fairly and be “transparent and accurate”. However, it has no open investigations into domestic smart meter wrong-doing at the time of writing.   

An Energy UK spokesperson says: “Energy companies are committed to meeting the government’s deadline of ensuring all households and businesses are offered a smart meter by 2020.

“Energy companies will be adopting various methods of communication with their customers to increase engagement and enable as many people as possible to experience the benefits that smart meters bring.

In reply to by anonymous_stub (not verified)

Hi smart meters are supposed to be.able to read vi mobile network how do they get a reading if you don’t have a mobile or internet network as I’m not allowing them to install one if it makes it difficult to do so by not giving them the mobile or internet details

In reply to by anonymous_stub (not verified)

My former supplier (SSE) kept telling me (letters & emails) it was a legal & safety requirement and I kept responding that it wasn’t. My current supplier (OVO) make it clear that it is not a legal requirement, only a recommendation. BUT this issue of avoiding estimated bills is seriously overplayed as being an inevitable consequence of not having a Smartmeter. Even in your article the implication is there. I cannot remember the last time I got an estimated bill, it must be in the 80’s and I’m well aware of what different appliances and practices cost. Reading my meters takes only a couple of minutes. So, given the problems with Mk1 units when switching suppliers, I’ll only consider a Mk2 generation meter but until then I’ll opt out.

In reply to by anonymous_stub (not verified)

One issue you haven't mentioned is that (according to my supplier, Octopus Energy) the gas and electricity meters have to be fairly close together (according to the Octopus web site, "not more than 10 meters [sic] apart"). Our gas and electricity meters are about 20 metres apart, with several walls between them. When I raised this with Octopus, their first reply was that it didn't matter, but when I pressed them they eventually said that because the gas meter has to communicate with the electricity meter, which then communicates with the smart metering hub, the smart metering wouldn't work for gas. I don't know how many other houses have the gas & electricity meters a long way apart, but I'm sure our house isn't the only one! It's worth flagging this up, if only to avoid other people who would like to have smart meters wasting time asking their suppliers, only to find that their meters are too far apart.On a separate issue, all credit to Octopus for making it clear that haveing a smart meter is (at this stage) purely voluntary.

In reply to by anonymous_stub (not verified)

If they could send an electric shock to the kids every time they leave something running I'd have one tomorrow, as for saving money? - you pay for what you use however its metered!

In reply to by anonymous_stub (not verified)

I was emailed on the 14th of this month, April, saying my smart meter will be installed on the 18th. This was the first I'd heard about this. The email said I could change the appointment but a charge could be imposed if it was less than three days before. My supplier's offices are closed on the weekend, meaning I can only contact them on the 16th. I am waiting to see if they will charge me, I live alone so no one will be at home during the day.

In reply to by anonymous_stub (not verified)

Another half- baked example of the digital world causing chaos in the community with such differing opinions on smart meters. What is wrong with the present so-called "old" meters that have been in use for endless years with no problems? This is just another example of the loss of jobs that this measure will create. What will the present meter readers do in future?? Join the ranks of the unemployed I expect while the "smart meter" debacle continues. What a crazy world we live in!!!

In reply to by anonymous_stub (not verified)

A very interesting and informative report on smart meters. most people I have spoken to are under the impression that all they get is the little'plug in' gadget that will tell them many interesting things about their fuel usage. The introduction of smart meters is the replacement of the actual gas meter 'under the sink' and the electric meter 'in the cupboard' needs replacing plus an additional unit to send the signal Information to the supplier. This is a program which should have rolled out 20 years ago but delayed due to technical difficulties..As times goes on all properties will have these and then meter readers knocking on the door will be a distant memory!!

In reply to by anonymous_stub (not verified)

SSE was going to fit a Smart Meter but, when I switched to Solarplicity in Oct 2017 because of a hike in price, advised me to contact my new supplier.Now going to wait till Mark 2 meters are available as I have Standard & Low cost Elec plus Solar Panels and my new Meter will be in my house, not as at present in a floor-level cupboard in the Garage!

In reply to by anonymous_stub (not verified)

One further point is that a lot of house like mine have the meters in the cellar with no mobile phone signal in that part. An engineer came to install a smart meter but had to change to a conventional one because of no network signal. Smart meters rely on a mobile network. I wanted one but couldn't have one.

In reply to by anonymous_stub (not verified)

One big con. I rang E.ON and asked if I would save money. They said NO.

In reply to by anonymous_stub (not verified)

I don't seem to be receiving regular emails to the above email address?!

In reply to by anonymous_stub (not verified)

These devices are clearly aimed at big family's where there is of course a tendency to leave lights on everywhere, and fridge doors open, tv's and gaming units on etc, most of the day. You will do little to aid these kind of customers to save on their bills unless you get them to change their whole lifestyle habits! The reality is that smart meters just make life easy for the meter readers, and allow the utility companies to cut back on meter reading staff, so they can be more cost productive. It doesn't help the householder at all really. Especially if you're one who magages your meter readings on line, like I do. I mean how difficult is it to read a meter for Gods sake?! Another issue is that these gadgets are 2 part, and that can sometimes be a nuisance. My elderly mother for instance, was adamant she didn't want another electronic gadget in the house that she didn't understand! (A lot of older folk are just like that. 'Non techy'). They need to be able to pick up a mobile phone network too, to transmit the readings. So if you live in an area where the mobile signals are lousy - like my mother - then that's not going to be much good to the utility company or you for that matter! These things will not give advise on what to cut back on. They will merely show you how much you are using. You would have to learn how to interrogate them for the appropriate information. You would need to keep records of past readings, so you can compare the 'stats'. Really, is this going to happen?! I think not in the average household!

In reply to by anonymous_stub (not verified)

I had an appointment with Scottish Power in May last year. They turned up due day to fit it, then said it could not be done as a survey was required. Since then NOTHING!!!

In reply to by anonymous_stub (not verified)

I use NPower and was told that I did not have to have a meter when they first contacted me to say they would be installing one. I phoned to confirm that I did not want one without a problem.

In reply to by anonymous_stub (not verified)

So there is no certainty that after installing millions of smart meters, they will retain their smart capabilities when people change energy suppliers. Given that we are all bombarded with pressure to compare and switch energy suppliers, this just goes to show how disjointed the whole programme is. In case people are unclear - they need to realise that we, the consumers, are paying for all these smart meters through hidden costs within our energy bills - and we are paying dearly for what is clearly a flawed system if nobody can be sure that smart meters will retain their intended functionality on changing supplier. Didn't think that through properly did they ?

In reply to by anonymous_stub (not verified)

...and they've been known to catch fire. I really don't want one anyway!

In reply to by anonymous_stub (not verified)

People with solar panels should think twice, especially if you think you actually use most of the solar power you generate during the day. (eg retired people home all day). Part of the FIT payment assumes that you send 50% of generated electricity to the grid a smart meter could potentially measure the actual amount you send and might reduce your FIT payments. I have also heard anecdotal stories about people with a smart meter having the electricity they use and generate being charged for as if it comes from the grid. The fact that some companies are not yet fitting meters to homes with panels suggests to me that there are problems using smart meters with solar generation.I think smart meters need to be developed more and the whole process made more transparent before I would consider one. As for savings well I had a monitor in the past and for the first few months I checked it regularly which did influence my usage but eventually forgot it was there, which is I think what most people will do.

In reply to by Tim (not verified)

Without having a bench test of both types of meters with side by side measurements it be difficult to ascertain. I'd be guessing that possiblly the old meter drew more current than the new 'digital' style ones. By the time you've accidentally re boiled a kettle once, that extra power used would make up for any consumption between the two types of meters for at least five years of running.Like wise,with my old central heating timer-that was mechanical versus it's newer digital counterpart, I suspect the mechanical version would use more kWh per annum, even though the actual amount used would be very small in comparison to the whole house's over twelve months.

In reply to by David Childs (not verified)

Had exactly this today and told them this is a high pressure sales tactic with no opt out option on their text.

In reply to by Audrey Barr (not verified)

I am surprised at the comments of Audrey Barr 10th August that the N power engineer said there was not enough space to fit the Electric or Gas meters. The new 2 items required to replace the existing electric unit should easily fit on the same board and regards to the gas meter the new replacement is smaller and an adaption unit would be used to enable the engineer fit it without any difficulty. I would suggest she asks N power to send a Supervisor to inspect the locations of these meters and advise her of any difficulties.

Add new comment