Policy

Helping households to cut their energy bills

Supporting detail:

Smart meters

Smart meters are the next generation of gas and electricity meters. They are part of our plan for upgrading the UK’s energy system.

We aim for all homes and small businesses to have smart meters by 2020. Energy suppliers will be required to install smart meters and take all reasonable steps to install them for everybody.

Consumers with smart meters will be offered an in-home display (IHD) that lets them see how much energy they are using and what it will cost. This will let them have more control over their energy use and help them save energy and money.

Between now and 2020 energy suppliers will be responsible for replacing over 53 million gas and electricity meters. This will involve visits to 30 million homes and small businesses.

Benefits

Smart meters will give consumers:

  • near real-time information on energy use, expressed in pounds and pence
  • the ability to manage their energy use, save money and reduce emissions
  • an end to estimated billing – people will only be billed for the energy they actually use, helping them to budget better
  • easier switching – it will be smoother and faster to switch suppliers to get the best deals

Smart meters also give suppliers access to accurate data for billing, removing the need to manually read meters.

We are making sure consumers will be protected when smart meters are installed in properties. Our provisions to ensure this mean:

  • there will be no sales during the installation visit
  • installers must provide energy efficiency advice as part of their visit and they will need permission before the visit if they will want to discuss their own products
  • consumers’ privacy will be protected and they will have control over their smart meter data
  • we have a programme in place to build confidence in our system and improve consumers’ understanding of how smart meters work

A smart meter can work in pre-payment or credit mode. Pre-payment customers will see some particular benefits from having a smart meter. For example:

  • energy suppliers may offer new and more flexible ways of topping up their meter including the ability to top up over the phone or online
  • the smart meter can be set so that consumers do not run out of credit at night and won’t be left without power when the shops shut

Find out more by visiting Smart meters: a guide.

Most householders will have smart meters installed by their energy company between 2015 and 2020, although some energy companies are starting to install smart meters now.

Roll-out of smart meters

The roll-out of smart meters will take place in 3 stages.

Policy design stage

The policy design stage ran between July 2010 and March 2011 and was managed by the Office of Gas and Electricity Markets (Ofgem) on behalf of the Department of Energy & Climate Change (DECC).

Find out more about the decisions taken in this stage.

Foundation stage

The foundation stage began in March 2011. We are working with industry, consumer groups and others to prepare for the second stage, which is the main installation stage. The foundation stage will let industry:

  • build and test systems
  • learn what works best for consumers
  • learn how to help people get the best from their meters

During this stage we will also established the Data and Communications Company (DCC), which will provide data and communications services for smart metering nationwide.

Main installation stage

The stage when most consumers will have SMs installed and will start in late 2015 and end by the end of 2020.

Costs and funding

Over the period to 2030, the installation of smart meters will provide £6.2 billion net benefits to the UK: the programme will cost £10.9 billion and provide £17.1 billion in benefits.

Award of DCC Licence: 23 September 2013

Arrangements have been completed today to establish and operate the smart metering Data and Communications Company (DCC). This represents a significant milestone in the roll-out of smart meters across Great Britain.

The Data and Communications Company is responsible for linking 53 million smart electricity and gas meters in homes and small businesses with the business systems of energy suppliers, network operators and energy service companies.

Read the full details in the Written Ministerial Statement and the Award of DCC Licence news story.

Stakeholders we work with

The smart metering programme works with a wide range of organisations, including energy suppliers, networks, consumers groups and regulators. More information about this work:

How we work with stakeholders

We have set up working groups for representatives from industry, consumer organisations and other bodies:

Publications

Latest publications

The most recent publications relating to the Smart Meters programme include:

Further information

Consultations

DECC has published a number of public consultations regarding the Smart Meters Programme.

Impact assessment

The Smart Meter programme carries out regular impact assessments, which we will update as the programme develops.

Smart meter roll-out for the domestic and small and medium non-domestic sectors (GB) (published 30 January 2014)

Evidence and research

The evidence supporting the roll-out of smart energy meters in the UK is based on international and national research. Energy suppliers that are rolling out smart meters and consumer groups with an interest in the programme have also carried out related research.

DECC monitoring, evaluation and consumer research

DECC has produced the following research for the Smart Meter programme:

UK evidence

Ofgem has produced the following research on smart meters:

International evidence

Research on smart meters from across the world includes:

Europe

Ireland

US

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