Written statement to Parliament

Written Ministerial Statement by Edward Davey: Smart Metering

Written Ministerial Statement by The Rt Hon Edward Davey Mp: Secretary Of State For Energy And Climate Change on Smart Metering

I am today publishing an update on progress and plans for the roll-out of smart meters across Great Britain. The document will be placed in the Libraries of both Houses and on the Government’s website.

The roll-out of smart gas and electricity meters is expected to deliver significant economic benefits and, more widely, to improve the consumer experience and engagement with the energy market, for example by making switching between suppliers quicker and easier.

Smart meters are becoming available to more and more people - removing estimated bills and giving customers better information to manage their energy consumption and choose the right tariffs for them. The Coalition is committed to making smart meters available to everyone as soon as possible. We support moves by some suppliers to offer smart meters as early as possible and we have already taken steps to support this. Today we are announcing further policies designed to give energy suppliers confidence to move quickly.

We have decided that from the end of this year, when a customer switches from a supplier who has provided them with a compliant smart meter, the new supplier cannot replace that smart meter with a dumb meter and must either rent the previous supplier’s meter or install their own new smart meter. This will give greater confidence to early movers over their investments. We are also proposing for consultation that, when a customer with a compliant smart meter switches supplier, the new supplier must continue to provide remote meter readings. This would make sure that customers continue to receive one of the important benefits of smart metering: more accurate bills. These and related proposals are set out in today’s Government response to the consultation on the Foundation Smart Market. Industry has told us that they expect to roll out in excess of 2 million compliant smart meters to customers over the next two years of the Foundation Stage of the smart metering roll out and today’s proposals will give them even greater investment confidence to do so.

In December 2012, the Government committed to review the programme plan and timetable during the first half of 2013, taking into account of learning from energy suppliers from their early smart meter deployments and from bidders who wish to provide the common data and communication infrastructure (the “DCC services”) necessary to support smart metering on a nationwide scale.

As part of the procurement process, DECC has therefore tested with bidders for DCC communication and data service provider contracts, and with the energy industry, the time needed for the design, build and test phases of their programmes. The consistent message was that more time was needed if the mass roll-out was to get off to the best possible start and ensure a quality experience for consumers. We therefore now expect suppliers to be ready to start their full scale roll-out by autumn 2015, supported by the DCC services.

Completing the national rollout will be an enormous logistical and technical challenge for the industry, involving visits to around 30 million homes and small businesses and installing over 50 million meters. To this end, and reflecting the extended period to build and test the systems required by industry, the Government has decided to move the completion date for the mass roll-out from end 2019 to end 2020 - although I expect the vast majority of smart meters to be in place against the original 2019 deadline. Getting this right for consumers is the Government’s priority and this package of proposals will give consumers and industry the confidence they need for a successful roll out.

I am also laying before Parliament today licence modifications to require: energy suppliers and network operators to accede and comply with the Smart Energy Code; and energy suppliers to ensure that smart meters provide domestic and micro-business consumers with access to key data, and that key smart meter functions are switched on. Subject to the successful completion of the parliamentary process, the licence conditions will come into force on 14 July 2013. More information on these publications can also be found on the Government’s website.

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