Offer energy use displays, say MPs
Households and businesses should be offered free "in-home displays" to give them information on their energy use and costs as part of the roll-out of smart meters, MPs have said.
More than 50 million smart meters are being installed in homes and small businesses between 2015 and 2020 to produce more accurate bills, make it easier to switch suppliers and deliver savings for energy companies and consumers.
The scheme is set to cost an estimated £12.1 billion but the Department of Energy and Climate Change (DECC) estimates benefits could be £18.8 billion. Households could save an average £24 a year on their bills, and businesses £164. However a number of issues must be addressed if the benefits are to be realised, a report by the parliamentary Energy and Climate Change Committee warned.
DECC, regulator Ofgem and some energy suppliers have suggested competition in the market will ensure costs are kept down and benefits are passed on to consumers through lower energy bills, the MPs said, but warned the market was not necessarily competitive enough for this to be the case.
DECC and Ofgem must retain responsibility for ensuring costs do not spiral and benefits are passed on until there is strong evidence the market will do the job, the committee urged. Consumers have to actively engage with the smart meters, which can supply them with real-time information on their energy use and costs as well as enable suppliers to take readings remotely, the MPs said.
In order to ensure homes and businesses are engaged, the aims and benefits of the scheme need to be clear, and officials have to address concerns people have about health impacts of the technology, data protection and privacy. And they should be offered free in-home display units which give people real-time consumption and billing data from the meters so they can understand, reduce and alter their energy use.
The MPs also suggested that smart meters should only be installed when versions of the technology and sufficient communications coverage are available to ensure that consumers can use them effectively. DECC recently pushed back the timetable for rolling out the smart meters in response to delays in the scheme's implementation, a move welcomed by the select committee.
Sir Robert Smith, speaking on behalf of the committee, said: "There is now a welcome opportunity to ensure that public engagement strategies are well under way before mass roll-out begins and that a range of messengers, including charities, local authorities and other trusted third parties, will be involved."
Baroness Verma, Parliamentary Under Secretary of State for Energy and Climate Change, said: "Smart metering will bring substantial benefits to households and businesses, including more accurate information on energy usage and cost, and an end to estimated billing.
"We are working closely with industry to make sure these benefits are communicated effectively, and to ensure that we take an open and transparent approach to any concerns that people may have. Overall the net benefits from the roll-out of smart meters amount to around £6.7bn, and we are committed to making sure that these are delivered to consumers and businesses."