Smart meter rollout 'needs private sector input'

Business

Smart meter rollout 'needs private sector input'

By Joe Lynam

Business correspondent, BBC News

       13 June 2015
 From the section 
Business

The UK-wide rollout of smart meters needs to be run by someone outside of government, the company set up to promote the project has said.

The UK-wide rollout of smart meters needs to be run by someone outside of government, the company set up to promote the project has said.

By 2020 every home should have a digital meter, which communicates directly with energy suppliers and can allow more efficient energy usage.

Smart Energy GB said government was "not good" at such projects and warned it it could cost more than the budgeted £11bn without private sector input.

The government has rejected the call.

Olympic delivery

The last Labour government announced plans in 2009 for every home in Britain to be installed with smart meters, which the government and energy firms believe could lead to savings of an estimated £17bn.

But Smart Energy GB fears that with 1.6 million of the proposed 26 million smart meters currently installed, the timetable could slip and end up costing consumers more than the budgeted £11bn.

Baroness Margaret McDonagh, the chairman of Smart Energy GB, said that the installation of smart meters throughout the UK was a giant infrastructure project, and was similar in scope to the building of the HS2 rail line and the Olympic venues. 

"As we know from experience, governments are not good at big infrastructure projects because it's not their business," she said. 

"To do these things well, you need to be doing them all the time. When a body can focus on these things with a date in mind - like the Olympic delivery - they can achieve it on time and on budget."

She is calling for the government to appoint a chief executive from the private sector to run the project.

But the Department for Energy and Climate Change (DECC) has rejected the idea.

"Last year, an independent review on the smart meters programme backed the current delivery model, which is going to deliver the benefits of smart meters at the lowest possible cost to billpayers," said a spokesperson for the DECC.

It is hoped that smart meters will encourage consumers to be more selective on how they use energy by choosing, for example, to run the washing machine at a time when electricity charges are lower. 

In the near future this will be even easier as the "internet of things" takes hold. This means new devices will come onto the market which will communicate with the smart meter and switch themselves on and off at the most energy efficient times.

But apart from consumers saving money, the biggest winners from the nationwide installation of smart meters will be energy companies themselves. 

That is because the current analogue systems prevent the efficient distribution of energy to our homes. More electricity is allocated for each home on the off-chance that it will be needed. With smart meters, the power will only come from the grid, the moment it is actually required.

But smart meters are expensive and time consuming to install in every single household in Britain. About 6% of the total number of homes have a smart meter already. 

To achieve the full 100% and meet the Conservative party election promise, a massive ramp up in the installation process will have to start immediately.

http://www.bbc.com/news/business-33118642