Consumer group warns of cost blowout with smart meter rollout in the UK
Article from BBC News:
Which? warns of energy smart meter ‘fiasco’
15 January 2012
The scheme to install new energy meters in every home in the UK should be halted because of spiraling costs, a consumer campaign group has warned.
Which? said the government, rather than energy companies, should install the “smart meters” to keep costs down. But Energy Minister Charles Hendry said the £11.1bn cost of introducing them to 30 million homes and firms from 2014 to 2019 would reap an £18.1bn benefit.
The devices show exactly how much gas and electricity is used in real time.
The project has been led by energy companies who have been installing the meters house-by-house as customers ask for them.
Which? claims it would be better if the government co-ordinated the installation process, whole streets at a time.
Executive director Richard Lloyd said the government did not have a “credible plan” to keep on top of costs. “Smart meters can bring many benefits, but consumers won’t accept them at any cost, or from suppliers they don’t trust,” he said. “It’s naive to hope that competition in the energy market will keep under control the cost of installing smart meters in every home in the country.” He said the government should not write a “blank cheque” on behalf of energy customers at a time when people are struggling to pay their bills. “The Energy Department should stop and review the smart meter roll-out before it becomes an £11bn fiasco,” he said.
Which? welcomed the meters for their ability to end estimated bills and for allowing customers to monitor energy use. But it said it wanted energy firms to report yearly to the watchdog Ofgem on the costs of the scheme and how much of those costs were being passed on to customers.
The Department of Energy said the project was already being overseen by ministers and had safeguards built in.
Mr Hendry said: “The introduction of smart meters will unlock huge benefits for the UK, and the coalition government has published detailed plans showing how we will deliver this. “The last thing we need is more dither and delay.” He said he accepted that government had been “too hands-off” in the past, which is why the scheme was brought “in-house”. “We are determined to take the scheme forward, with ministerial oversight and safeguards for consumers built in,” he said. Smart meters will better inform consumers of their energy consumption and increase off-peak tariff usage. Last year a National Audit Office report warned of “major risks” associated with the planned roll-out.
It found there was uncertainty surrounding the extent to which householders would change their behaviour when the new meters were introduced.
Which? has urged ministers to review their approach and take a strong leadership role.
Links to the consumer group Which?: