Kate Mackenzie Location, location: Lobbying over smart meter displays

Power companies have, by and large, tended to voice support for introducing smart meters. This makes sense – one of the big advantages of smart meters is they remove the need to regularly send staff out to check meter readings. Another aspect of smart meters makes them less logical for utilities: those that display household energy use also lead to a reduction in use – although estimates of exactly how much vary from 1 per cent to 15 per cent.

Now, The Times reports, the Energy Retail Association is accused of lobbying UK government ministers against mandating that smart meters include a display allowing customers to monitor their own energy usage over time.

The Local Government Association is outraged:

Paul Bettison, chairman of the LGA environment board, said: “If energy firms succeed in blocking this plan to give people in-home energy monitors, millions of households will be denied the chance to cut their fuel bill. Energy displays help people change how they use electricity, cut back and save money.

If correct, this would contradict the ERA’s own publicly-stated support of smart meters as a way of reducing energy use. Just this month, Gary Felgate of ERA wrote a joint letter with Andy Atkins of Friends of the Earth to the Guardian, calling for quick introduction of smart meters. And the letter specifically describes smart meters as a way for customers to reduce their electricity use and CO2 emissions:

Importantly, they will allow consumers to work out which appliances are causing the most CO2 emissions and costing the most to run. Smart metering will also allow customers to monitor how much money they are earning by generating their own green energy at home, and exporting it back to the grid. They are essential if consumers are to take control of their energy use, reduce their bills and their carbon footprint.

So what is ERA playing at? The organisation told The Times it wasn’t the displays they objected to so much as the fact that, er, they might be forced to introduce them:

“The ERA and its members firmly believe that energy companies should not be restricted to providing a one-size-fits-all solution, but should be allowed to innovate and offer customers precisely the kind of display they would find most useful — whether this is with a display unit, via a website, or even through a mobile phone application.”

But would a web or phone-based application prove so effective for customers? Location, as a study by energy regulator Ofgem found, is everything when it comes to customers actually using the smart meter data to change their energy use patterns. The report wrote (Ofgem’s emphasis):

The display was hardwired to the physical meter and to minimise disruption and installation time, limits were placed on the extent of wiring to be undertaken. This resulted in far too many Smart Meter display units being installed in inaccessible and not very visible locations. The location is important as those households with a Smart Meter in a visible location (e.g. hall or kitchen) are five times more likely to interrogate their Smart Meters on a greater than once a quarter basis as those with less visible or inaccessible locations. Around 40% of households with such visible locations read their Smart Meters more often than quarterly.

The power companies might not need to worry so much, however – if they don’t introduce variable pricing along with the monitoring, studies carried out so far suggest that the reduction in energy use would be far lower.

Related links:

Do smart meters actually save energy? (FT Energy Source, 11/05/09)
How the UK plans to introduce smart meters (FT Energy Source, 24/03/09)