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Smart Meters

Pros and Cons of Smart Meters

Overall, the installation of Smart Meters across the country would seem to be a good thing but only by a small margin financially. Good or bad can be looked at in many different ways and whether you think that they're an advantage or disadvantage will depend on your needs and attitude. Let's look at the pros and cons of different aspects:

What are the advantages of smart meters?

No more estimated bills: With details about your energy consumption transmitted regularly to your supplier, you will no longer receive estimated bills based on your past use if you fail to submit readings. With accurate bills, you'll only be charged for the energy you actually use.
No need to provide meter readings: Smart meters' automatic transmission of information about your energy use including meter readings eliminates the need for you to get to your meter, write down your meter readings, and submit them to your energy supplier.
Potential for savings: By giving customers insight into their energy use, smart meters can help households reduce their energy bills by understanding what energy appliances use and when.
See your energy spend in pounds: By displaying your energy use not just in kilowatt hours but also in pounds and pence, smart meters can help customers understand how their energy use translates into spending.
Free at point of installation: You won't have to pay anything directly to have a smart meter installed.
Easier for customers on pre-payment meters: Smart prepayment meters and their In Home Displays can help households on pay-as-you-go tariffs better keep track of their credit balances, even issuing alerts when meters are running low. They can also allow customers to top up their meters via the internet or a smartphone app, eliminating the need for them to travel to a local shop.
Additionally the Energy Bill Support Scheme payments can be added to the meter remotely so that you don't have to deal with paper vouchers.
Benefit from time of use tariffs: Smart meters can help customers with time of use tariffs like Economy 7 and Economy 10 to monitor their energy use and transfer more use to cheaper off-peak hours. Smart meters also allow much more complex time of use tariffs, ultimately giving different prices for each half-hour every day, enabling customers to watch gas and electricity prices rise and fall in real-time and adjust their activities accordingly.
Benefit from Demand Reduction schemes: Customers can join Demand Reduction Schemes to be paid when they reduce load at peak times. The data from Smart Meters makes this possible.
Detect Theft: The cost of energy theft is estimated between £830m to £1.388bn per year (reported in 2022) which adds £29 to 48 annually to each domestic consumer's energy bill. Smart Meters help this by indicating which areas are taking more energy than the meters are showing, and from the alerts on individual meters.
Reduced duration power cuts: Engineers will know much faster when power cuts have occurred and their location. This will enable them to make quicker repairs.
Improve grid efficiency: By better understanding the flows of electricity and gas through the grid and distribution networks, enhancements can be focussed on where they are really needed.
Reduce your environmental impact: With greater insight in your energy use, you can change your habits, not just to see savings on your bills, but also to reduce your energy carbon footprint. For example, some smart tariffs allow customers to save money by using energy away from peak times or when there is excess clean electricity available, thus reducing the use of fossil fuels.
Net Zero: Smart meters are fundamental to achieving net zero in the UK. The juggling of demand, wind power, solar power, electric vehicles, and storage batteries can only be achieved with the accurate and frequent measurements which smart meters provide.
Switch suppliers easily: By providing change over readings at exactly the right time and allowing automatic set up of credit/prepayment and tariffs, smart meters make switching suppliers much easier.
Automate your home: Customers can opt for electric vehicles, heating systems and smart appliances, such as washing machines and dishwashers, which can connect to the smart metering system to access pricing data. Their activity can be programmed to automatically take advantage of cheaper rates, thus reducing the impact on the energy grid and saving money.
Improved care monitoring: The Smart Meters for Independent Living (SMILE) project is a ground-breaking trial into the energy usage patterns of people with disabilities and older people living independently. The project uses this data to create a view of their daily routines and spot unusual changes in behaviour which could cause concern.
High rates of customer satisfaction: Consumer watchdog Citizens Advice found that 80% of people who had a smart meter installed were satisfied with the installation process.
More Supplier deals: Some of the best energy deals, with the cheapest gas and electricity, are sometimes only available to customers with smart meters. These may include personalised tariffs, tailored to your household's specific energy needs and use.

What are the disadvantages of smart meters?

In Home Display Out of Date: Unfortunately, the In Home Display (IHD) is often slow to update for tariff changes which is confusing. But don't worry as your IHD does not produce your bill; your supplier uses your meter readings in their billing systems to produce your bill.
Change behaviour for savings: Smart meters don't automatically deliver savings. Customers have to actively engage with what their In Home Display is showing and change their behaviour based on its information, or they won't see their bills fall.
Change to prepayment remotely: Suppliers can change the meter from credit to prepayment remotely. The supplier must check that the customer is not in vulnerable position and give at least 7 day's notice before the change to payment method happens. It can be reversed if you dispute the change.
Anxiety: With recent increases in energy costs many people have found the information from the smart meter and IHD worrying. The IHD constantly reminds you of the high cost of energy and leaves people with the dilemma should I heat the house or reduce costs.
Cost spread across all our energy bills: The smart meter rollout is estimated to cost nearly £14 billion, an expenditure that will be spread across all our energy bills over the next few years. The way the costs are being spread means that the maximum cost impact on a customer's bill is an additional £11 a year.
Privacy concerns: Some customers worry information about their energy use will be made available to third parties. However, UK law currently prohibits energy suppliers from passing on their information without the customer's explicit permission.
Smart meters may go dumb after switching: Some of the smart meters installed are first generation devices (SMETS 1), which often 'go dumb', or lose functionality, after customers switch suppliers. The second generation of smart meters (SMETS 2) don't have this problem and most of the first generation meters are slowly being upgraded to prevent the problem.
Not available to some customer on prepayment and time of use tariffs: While smart meters technically exist for households on prepayment and time of use tariffs and can make these tariffs easier to manage and find savings, suppliers have been slow to upgrade their internal systems to offer these variants. The result is that a few suppliers aren't offering prepayment and time of use on smart meters yet.
Poor signal outside the house: Not all households have a good radio communication signal from their meter to outside their house. If the signal is poor the meters cannot communicate to the supplier. In these circumstances a Smart Meter will still be installed but it will be "dumb", and you'll have to manually take meters readings.
Poor signal inside the house: In large houses, those with thick walls or foil insulation, the signal from the communications hub on the electricity meter to the IHD (In Home Display) may not be good. If the signal is poor the IHD may only work intermittently which can be very frustrating.
Installation: You have to be at home for the installation which takes a couple of hours, and you will have a temporary loss of electricity and gas.

Do people like Smart Meters?

The government are carrying on with Smart Meter installations boosted by customers liking the experience. Recent surveys from August 2017 and March 2019 have shown:

Accuracy

Old traditional mechanical meters could get less accurate with age. This was often in the customers favour as they could stick and thus under record consumption. Unfortunately, this can lead to customers getting a bill shock when they have a new meter installed as the monthly consumption suddenly jumps up. This bill shock isn't particular to a new Smart meter as it would also happen with a new traditional meter.

The other advantage of Smart Meters is that the reading will be taken at the right time when your tariff changes or you move house.

There have been reports from researchers that Smart Meters can be inaccurate. Some tests have shown that power controllers, such as light dimmers, can prevent the smart meter recording accurately. However, these meters used measuring techniques not used in UK meters and therefore UK meters should be accurate across the variety of load types found in a home.

Financially

The government's own business case for the roll-out of Smart Meters is only just positive, based largely on the forecast that customer will reduce their use of energy by understanding it better and being better informed.

If you already have a clip over the cable display at home showing your energy consumption, then you are halfway there. The In Home Display (previously known as Smart Meter Display or Home Energy Monitor) provided with Smart Meters will do more though, in that it covers both electricity and gas, and can show your current bill. To save money you will need to take action such as turning off unnecessary lights. The In Home Display will help you see when you're using more energy than usual so can be trigger for you to look around the house to see what's left on.

More advanced energy products in the future, such as different rates for peak times, should allow energy conscious customers to save more money, however, ironically these conflict with the government's drive to force suppliers to have a small range of simple products.

Features

Apart from PAYG (Pay As You Go) the features a customer can play with are limited. You will no longer have to submit a meter reading and therefore should never get an estimated bill again. This is especially important when you change supplier or move house as things often go wrong there currently when people either don't provide reading or provide conflicting ones.

Suppliers are now offering customers ways of viewing their meter reading data whether daily or half-hourly.

Prepayment

The ability to purchase electricity and gas on a prepayment or PAYG (Pay As You Go) basis is a big advantage of Smart Meters. Once you've paid, top up can be sent to your meter automatically without having to use chargeable key fobs. If communication to the meter is down you can still top up by entering the long reference number provided with your purchase into the meter, although this may not be an easy thing to do. For customers on PAYG who have difficulty with reliable communications and entering the long number, a separate number entry pad can be provided by your supplier.

What are the advantages of prepayment?

You have control of how much and how often you top-up
As you pay for your energy before you use it, you won't get a big bill at the end of the month or quarter
Electricity and gas can be topped up separately depending on your priorities
Your meter and IHD (In Home Device) shows how much credit you have left, so you can stay on top of your spending.
If you have an existing debt, you'll be able to pay it off gradually through your meter.
In July 2023 the UK government forced suppliers to match prepayment and Direct Debit costs, so you no longer pay extra for the prepayment service.

What are the disadvantages of prepayment?

If you don't top-up your meter up with enough credit, you won't have gas or electricity
You'll need to top-up more in winter, when the weather is colder and it's darker
You need to make sure there's always enough credit on the meter to cover standing charges, even when you're on holiday, for example
If you're using more energy than usual, you can't spread the costs over time.

Supply Disconnection

Make sure that you always read letters and texts from your supply company as they may be telling you that your Smart Meter is about to be turned into a prepayment meter because you have built up a sizeable debt. Once you are on prepayment your supply will be disconnected if you don't keep your account topped up. Agree with your supplier a debt repayment plan and they will collect the debt automatically through your meter.

The process would be the same with a traditional meter but a visit by a fitter would be required to install a prepayment meter.

Some described this as "Disconnection by the Backdoor" and the BBC ran an article on it entitled 'Energy firms remotely swap homes to prepay meters'.

Privacy & Security

There are concerns from some groups concerning security of the data or privacy. Smart Meters have been designed with top cyber security experts, including the government and GCHQ (Government Communications Headquarters), to ensure that security best practice has been incorporated at every stage. They do not use the internet, and they have their own closed, dedicated communications system. So far there have been no known instances of smart meter hacking or using smart meter data to aid in committing a crime.

Most data collected will be for meter readings. A Smart Meter can collect meter readings frequently, every 30 minutes, for sending back to your energy supplier. With such frequent readings there are concerns that someone could work out when you are away from home or work out what you are doing. Firstly, no one other than the supplier can see your data unless you give permission, and you can set how often meter readings are collected by your supplier. For example, if you are not on a complex product and don't want to observe the pattern of your own consumption, then you can ask your supplier to only collect data on a daily basis. This reveals very little about your lifestyle.

Suppliers collect your readings on a half hourly basis by default, but you can ask them to only collect daily, so you have some control. Like any technical secure system today, such as banks and NHS systems, the weakest link is probably the staff at the end of the process. If you are happy to use on-line systems for other purposes such as banking, it's likely you'll also be happy with your Smart Meter.

What you want to do will be very much down to personal choice and your view on sharing your data with others. It's a common concern and decision we all have to make these days, especially with the rise in sharing so much information through social media.

Electromagnetic hypersensitivity

Some people claim to suffer from Electromagnetic hypersensitivity and are therefore sensitive to the radio waves from Smart Meters. The radio waves from Smart Meters are no different to those all around us in mobile phones and modern household gadgets, so there is no additional risk from Smart Meters.

A study on Exposure to electromagnetic fields from smart utility meters in GB in 2017 concluded that "the exposure from smart meter devices is likely to be lower than that resulting from everyday devices such as mobile phones and Wi-Fi equipment, mainly because of very low duty factor values and greater distance of the transmitting antennas from the body."
"Low duty factor" simply means the Smart Meters transmit infrequently.

(Page updated: 2024-08-16)