Update on preparations for smart metering

The costs of installing 53 million smart meters will be borne by consumers through their energy bills and will cost around GBP215 per home or small business over the next 5 years to install the meters. Despite consumers footing the bill, they can on average make a saving of only 2% on the average annual bill of GBP1,328 by the time the roll out is complete. The Department is relying on the consumer becoming more "savvy" in making decisions about using energy and is depending heavily on assumed competition in the energy industry to control costs and deliver benefits. However, Ofgem's referral of the energy market to the Competition and Markets Authority reflected serious concerns about the lack of real competition in the industry. DECC should require suppliers to provide a clear breakdown for consumers of the cost of smart meters, their operational cost savings from stopping meter readings and whether consumers are achieving the expected reductions in energy consumption. DECC must especially ensure vulnerable and low income households get the benefits available from smart meters.
DECC also needs to ensure that smart meters are fully interoperable so that customers can switch easily between suppliers and that suppliers don't replace meters unnecessarily when customers switch. Some aspects of the Programme could be out-of-date by the time it is rolled out. Evolving technology suggests that customers could receive the information on their smart phones, making the in-home display redundant. Consumers will have to pay for them even though they might already be out of date