Customers Who Don’t Accept Smart Meters Could Face Higher Bills, Energy Minister Warns

Energy suppliers could hike prices for customers who stick with traditional meters, in an effort to encourage uptake of smart meters, an energy minister has suggested to MPs.

Climate change minister Lord Duncan of Springbank said the cost of servicing and maintaining “relic” meters would be high for energy suppliers, which will likely pass those costs onto consumers via higher bills.

"There's every possibility that at that point it will become more expensive to hold a non-smart meter so you'll see a disbenefit immediately, insofar as it will cost you more to maintain the old-fashioned installation rather than the new one,” he told MPs on the Business, Energy and Industrial Strategy (BEIS) Committee.

You’d "really have to love your traditional meter" to keep it, he said.

The government may also consider introducing laws requiring landlords install smart meters in tenants’ homes, Lord Duncan said.

Meanwhile, Ofgem has suggested it would like to see smart meters made mandatory for those buying electric vehicles.

A spokesman for the Department for Business, Energy and Industrial Strategy (BEIS) said: "As Lord Duncan highlighted, as more people have smart meters, traditional meters will cost more to maintain.

"The Minister also correctly pointed out that smart meter technology will work to the financial benefit of consumers and will help move the country towards the smart tech systems of the future."

Next generation smart meters are supposed to reduce energy consumption and thus carbon emissions and cut consumers’ bills, by making everyone more aware of their energy use. But the £13.5 billion rollout has been troubled from the start.

The government recently pushed back the deadline for offering smart meters to every home and small business in the UK by four years, to 2024, after the National Audit Office found “no realistic prospect” of the original deadline being met.

Meanwhile, many of the first generation smart meters already installed have lost functionality when consumers switched energy suppliers. In June, the Department for BEIS estimated that nearly 18% of the 14.9 million meters then installed had gone “dumb,” meaning they still display readings but are unable to communicate with the network.

A software fix upgrades these defunct first generation smart meters, but just 4,500 of the 2.7 million ‘dumb’ devices have been reconnected to the national network.

Rollout of the second generation meters, which avoid this problem, has been slow: just two million had been installed by the beginning of September.

Citizens Advice has warned that consumers are being pressured into accepting smart meters, as suppliers struggle to meet ambitious rollout deadlines. The consumer watchdog said it found that 80% of the people who had already received a smart meter were satisfied with it but said it received 3,000 complaints about smart meters in 2017. Consumers were upset about aggressive and misleading sales tactics from suppliers pushing smart meters and meters which lost functionality.