Smart Meters To Give UK Consumers Power To Control Energy Bills

by
Reuters
As rising energy bills anger British consumers, a government-led infrastructure project is sparking hopes that the public will soon be able to take more control over costs - by using smart meters.

* Britain to install 53 million smart meters by 2020

* Households can save 24 pounds per year using meters

* Meter users trust their energy suppliers more

As rising energy bills anger British consumers, a government-led infrastructure project is sparking hopes that the public will soon be able to take more control over costs - by using smart meters.

In a 12 billion pound ($20 billion) project, 53 million smart meters will be installed in homes and businesses across Britain by 2020, making consumers aware of how much it is costing them to use devices such as washing machines, televisions or tumble dryers in real time.

The growing cost of using energy at home has blazed onto the political battlefield ahead of a 2015 election.

Consumers have been outraged by a flurry of price rise announcements this winter, prompting Britain's opposition Labour party leader Ed Miliband to promise an energy price freeze for 20 months if he wins power.

The average home energy bill has more than doubled since 2004, hitting 1,315 pounds this year, according to British energy watchdog Ofgem.

"Let's be honest here, everyone understands pounds and pence, but not all of us - and I count myself in this sometimes - understand kilowatt-hours," said Lawrence Slade, chief operating officer of industry association Energy UK.

The government estimates the average British household can save around 24 pounds per year by 2020 and 39 pounds by 2030 by reducing their energy consumption using a smart meter.

Some 177,000 domestic meters have already been installed and around half of the users surveyed by private energy comparer uSwitch said the devices had helped them to cut down on energy consumption.

Chemistry professor Andrea Sella from University College London, who participated in a 2010-2012 smart meter pilot for RWE npower, said his smart meter helped him to save money.

The meter's in-home device (IHD) provided information on usage with a "traffic light" system showing current energy price levels fluctuating during the day depending on demand.

"Energy is effectively a tax: it's inescapable. It's like death. Nobody can get out of it," Sella told Reuters.

"But we could see at any given moment what was going on, and we could adjust, by saying let's not turn the dishwasher on but do that later."

REGAINING TRUST

After years of rising bills, British consumers have grown suspicious of the country's "Big Six" energy suppliers, often accusing them of overcharging.

The "Big Six" are Centrica's British Gas, EDF Energy , RWE npower, SSE, Scottish Power and E.ON .

Putting consumers in charge of their energy use can help suppliers regain trust as bills are calculated in a transparent manner. Indeed, the uSwitch survey found that 10 percent of smart meter users now trusted their energy suppliers more.

E.ON UK's head of smart transition, Jean Fiddes, said the utility's loyalty rating had benefited from smart meter usage.

The European Union has set member states an installation target of 80 percent by 2020, but only 14 of the bloc's 28 countries have mandated a rollout.

Italy and Sweden have fully installed smart meters but success ultimately depends on whether consumers use the information gleaned.

"You've got to put (the information) in the palm of their hand and make it really, really easy to use," said Mary Turner, chief executive of AlertMe, which works with companies such as British Gas to offer customers live usage information on their smartphones and online.

Eurelectric, the industry association for European utilities, estimates the smart meter market will be worth 30 billion euros ($41 billion) annually to the EU economy by 2030.

"The opportunity is there and it's really up to the industry to grasp it and to bring consumers with us," Energy UK's Slade said.