UK smart meters explained: How they work and whether you should get one

Everything you need to know about the gas and electric smart meter roll out

UK smart meters explained
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Separate gas and electricity suppliers, switching providers, now smart meters; your energy supplier has likely been hassling you about getting one – but are they any good, and should you get one? And the simple answer is... there is no simple answer.

While smart meters have been big business in the US for a while – nearly 80 million had been installed in the US by 2017 – things in the UK are still on a smaller scale. As of September 2019, just 15.6 million of them had been installed, and in typical British style, the issue is fraught with controversy, whataboutery and half-cocked technology that's already being superseded.

Everything from energy viruses, Big Brother privacy invasions and the risk of billing catastrophes have all been levelled at smart meters by the usual corners of the press, whipping consumer anxiety into a frenzy. Smart meters and automated readings are undoubtedly the future, but it's fair to say there are one or two teething problems.

But according to Smart Energy GB, the independent body promoting smart meters, consumers are saving 354kWh a year – enough to power the average home for a week. But what is a smart meter, how do they work and do you want one? Read on to find out.

UK smart meters explained

What is a smart meter?

Smart meters are connected meters which are designed to replace the electricity and gas meters which you've currently got sitting in your cupboard under the stairs. They do exactly the same jobs as the ones you've got at the moment but they send meter readings direct to your energy suppliers without anyone having to come round and look at them.

This is a good thing because you don't need to let a stranger into your home, you don't need to do any readings yourself and your supplier can bill you on how much gas and electric you've actually used rather than make estimates.

Now, it may be that you're still billed according to monthly averages of your total annual consumption, but the point is that the capacity is there to work on a pay per usage situation.

Now, as well as your supplier, your smart meter is also wirelessly connected to a little in-home display (IHD) which you have sitting around on the sideboard somewhere. That's designed to give householders meaningful representations of their energy consumption in real-time.

So, as well as the slightly impenetrable kWh measurements, it'll also display how much you've used in pounds and pence as well as your live rate of consumption, again, in pounds and pence. The idea is that you can see how and when you use the most energy at home and, hopefully, it'll bring in a few truths about having a shower that lasts all week.

You get the picture – or at least you will once you've had a smart meter installed. Once we're all getting a better idea of how much energy we're using, our homes can be made more energy efficient (so the theory goes), and that's good for the environment. They can even help you to save money as most models, like E.On's shown below, let you set daily and weekly budgets for your gas and electric.

Do you have to have a smart meter?

Take-up isn't compulsory right now, though you will be offered one. The government is forcing energy providers to offer all their customers the option of one, and wants 85% of homes to have them by 2024 (which has been revised from an initial 2020 deadline), but no one's going to force your hand at this stage.

You can hang on to your old meters for as long as they're operable which should be a very long time. Getting a smart meter installed won't cost you anything, though, and there's really very little to fear, so don't sweat it either way.

How do I get one?

All of the Big Six energy suppliers are offering them already to many of their customers and have been for years. That doesn't necessarily mean that they're ready to offer you one though. You can try to hurry them along by phoning them up and asking them, or by registering your interest on the relevant page of their websites, but it's more likely to be a case of whether or not your location and usage type casts you into their priority group.

Each supplier has a different set of customers it's looking to roll out to first, and you'll have to read up yourself on that one, but, generally speaking, if you're in an area of poor mobile coverage or using a prepay meter or Economy 7 meter, then you're probably out of luck. It seems the suppliers would rather get the easy ones working properly first.

Are there Economy 7 and prepay smart meters?

Two-tariff, such as Economy 7, and prepay smart meters are indeed available, from a growing number of sources, which could be a real bonus for these users. If you're a prepay customer, you'll get a mobile app, complete with warning notifications when you're running low, where you'll be to top-up instead of having to head to the petrol station to stick some more credit on your plastic key.

Those with a two-tariff meter will benefit because they'll actually be able to make sense of the system and see at a glance which tariff they're set to use at any given moment. In fact, smart meters may well give rise to a few more innovative multi-tariff packages once the energy companies get a better idea of our usage through all this live data.

And as it turns out, having to wait a while to get a smart meter may be no bad thing, because the roll-out has hit one or two bumps, to say the least.

should i get a smart meter

Which smart meter should I choose?

You're not likely to get much smart meter or in-home display (IHD) choice from your provider and, really, don't waste your time thinking about it. They're all very similar and pretty much all do the same things. The only one that looks a bit poxy is the one from Eon because it's not got a colour display. That said, Eon has the E.On Energy app which connects to your smart meter from your mobile or tablet without the need of the IHD anyway, so no worries there.

All the IHDs seem to come with a warning light which turns from green to amber and red depending on how decadent you're being with your waffle iron. They all have an AC mode as well as back up batteries, they all allow you to set budgets for how much you'd like to spend on energy each day – and then get notifications when you find you've gone way over what you'd intended – and they all including a reading of all the CO2 emissions you've been responsible for. Fun.

Like we say, though, don't sweat it. As far as we're concerned, none of these IHDs are either good or bad enough to make or break your choice of getting a smart meter with any provider, and they all look very similar and offer very similar functionality. You'll likely be doing all of this through your mobile phone in a year or two anyway.

The cases for and against smart meters in 2020

Smart meters ain't all sunshine and rainbows, kid – at least so the certain anti-smart meter campaigns (that's a thing) will have you believe. The biggest issue is with SMETS, the Smart Meter Equipment Technical Specifications: many of the smart meters now in use are SMETS1 models, but since 2018 suppliers have started installing SMETS2 devices instead.

SMETS1 devices work just fine, but the problem is that if you switch energy supplier then the connection to the cloud breaks. Your meter goes from smart to dumb again and you'll have to give manual meter readings once more. Your in-home unit will still function to a degree but many of them will only offer kWh displays at this point and not pounds and pence usage any more.

Not ideal, obviously, but energy suppliers have at least made some progress here. As we've said, almost all devices installed at this stage are SMETS2 models, which use a standardised network called DCC (for the Data Communications Company) – changing supplier should no longer make a difference. What's more, SMETS1 devices can be upgraded to carry on working after a switch, though you may lose some of your smart functionality for a period.

The bottom line is to check with your energy supplier before they install a smart meter in your home, and make sure it's SMETS2 if at all possible. For example, E.On says: "We'll always attempt to install a new generation SMETS2 smart meter first for you. If we can't we'll install a SMETS1 smart meter, even though it's past the SMETS1 end date.

"Before the end of [2020], we'll be upgrading all SMETS1 meters remotely, so you'll be able to continue to use your existing SMETS1 meter if you change supplier, which of course we hope you don't. You should aim to get a guarantee like this from your supplier if they have to install a SMETS1 device for whatever reason."

what is a smart meter

Probably the biggest scare story about smart meters is the claim that they give off intense bursts of microwaves, which can cause cancer. We're certainly not arguing that intense microwave radiation doesn't cause cancer, but according to Public Health England, British Gas and others, the levels of radiation from smart meters are very, very low; lower than those from your mobile phones and tablets and not really any different to the Wi-Fi network that you probably already have in your home. So, that's that one.

There are also worries over the potential for smart meters to be hacked – though the latest upgrades to these boxes mean your data should be very secure indeed. Hackers are more likely to go after major country-wide systems rather than the box sitting in your living room measuring how much electricity you're using. You shouldn't have any worries on this score either.

Privacy is another issue to think about: you need to be comfortable with the idea that a smart meter will give your energy provider access to your gas and electricity usage data. As it stands, your supplier will be able to access your daily energy use – unless you object – but they need your permission for the up-to-date info and they need your permission to use your data for marketing and if they want to sell it on to third parties. So, it's probably worth while digging your heels in on that one. There's more info from OFGEM here.

Of course when it comes to switching, your half-hourly energy usage data could come in very handy when you want to find a provider that's going to cost you the least with the most suitable tariff for your usage patterns. So it works both ways on this one.

The other "scandal" when it comes to the roll-out is the sheer cost. In case you missed it, public cash isn't exactly in plentiful supply. The smart meter revolution looks like it will cost fully £13 billion at the latest count, which is no small sum. Some people will frame that as wanton overspending, but others would counter that you can't expect to get efficient energy usage countrywide without backing the scheme with money.

As for costing you more yourself, there's no evidence to suggest that smart meters will charge you more for your gas and electricity usage. There have been one or two instances of mistakes where customers have been charged a small fortune but, obviously, these people never had to pay a penny for such glitches. There's a hidden cost that we're all already paying because the rates have gone up a touch to cover the cost of these so-called free installations, but there's not much you can do about that. You'll pay whether you choose to go smart or not.

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