UK Smart Meter Rollout Delays Are Costly-DECC Report

Technical, logistical and public communication issues have resulted in costly delays in the UK’s smart meter rollout.
Published: Thu 12 Mar 2015

In December last year, we published a guest article written by Nick Hunn who expressed his aggravation at the constant delays surrounding the UK smart meter rollout. [Engerati-UK Smart Meters Delayed. Again] Now, the House of Commons Energy and Climate Change Committee has released a report which shows that the delays are starting to cost the country dearly.

Smart meter delays costing consumers

Smart meters were meant to save the UK about £17.1 billion for a rollout cost of £10.9 billion and put an end to estimated bills, but according to the Committee the smart meter programme is in danger of becoming a costly mistake due to a number of technical, logistical and public communication issues which have resulted in delays.

Smart meters that would have enabled consumers to view their own energy consumption in real-time will not be delivered on time on current form, thereby depriving households of a cheap and easy way of cutting their energy bills.

The Committee is particularly concerned that a major piece of the programme's infrastructure, the Data and Communications Company (DCC), is currently behind schedule and MPs are saying that smart meters may only cut 2% from people’s electricity bills.

Smart meter plans - running out of time

The UK government’s aim is to install 53 million smart electricity and gas meters in households and small businesses by 2020 but Committee chairman Tim Yeo says that the government is running out of time and may not meet this target within the set timeframe. Plans for a national rollout of smart meters to every household have been in progress for over five years now.

According to the Committee’s report the policy problems "are symptomatic of a national programme that the government has left largely to suppliers and failed to drive forward effectively." The Committee urges the government to seek "industry-wide solutions" to the widespread technical challenges that remain.

Yeo claims that the government is at a “crossroads” with its smart metering policy. He explains, “It can continue with its current approach and risk embarrassment through public disengagement on a flagship energy policy, or it can grip the reins, and steer the energy industry along a more successful path which brings huge benefits for the country.”

Smart meter challenges that need resolving

The Committee identified several challenges that it says the government has so far failed to resolve:

• Technical communication problems with multiple occupancy and tall buildings

Compatibility problems between different suppliers and different meters, impeding consumer switching and absence of interoperability between foundation and rollout phase meters

• Shortage of smart meter installation engineers

• Potential more active participation of distribution network operators (DNOs) in the rollout

• A slow start to full engagement with the public on meter installation and long-term use

• The potential for mandatory time of use tariffs

• A reluctance to improve transparency by publishing the assessments on the smart meter programme by the Major Project Authority (an independent body that provides assurance to government on major projects).

The government must take a more active role in driving forward the industry-led rollout, seeking and facilitating industry-wide solutions to these challenges, the Committee says.

Smart meter programme needs independent oversight

Claire Maugham, director of communications at smart meter advocacy group Smart Energy GB, says that while the rollout of smart meters is "well underway", the programme requires more independent oversight. She adds that people may also need more support getting to grips with the technology once it is installed in their homes.

Given the many successful smart meter rollouts across the globe the trajectory of the UK’s programme is hard to fathom. Perhaps it’s the simple matter of over-promising and under-delivering, as well as not communicating (effectively enough) the real value that smart meters hold for consumers. Our recent webinar Don’t Leave Your Customers Behind – Learn how to Unlock Smart Meter Value for Consumers covers this critical aspect in detail. As PG&E’s president Christopher Johns says: “We thought we were undertaking an infrastructure project but it turned out to be a customer project.”

Can the UK’s smart meter programme be saved or has the damage already been done?

Further reading

House of Commons Energy and Climate Change Committee-Smart meters: progress or delay? [pdf]