Smart meters

How smart meters can help you make the most of your energy

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The roll-out of smart energy meters is well under way – but what are they designed to do, and can they save you money?

smart meter

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Smart meters are ‘smart’ because they communicate directly with your energy supplier. They send details of your energy usage so that you get an accurate bill – no more estimates, no one coming to read your meter, and no need for you to send readings yourself. It’s all done automatically. You have separate smart meters for gas and electricity, and you also get a display unit showing you how much energy you are using, and what it’s costing you.

Why are smart meters being introduced?

The government wants every home and small business in England, Scotland and Wales to have smart meters as soon as possible. Energy suppliers have been given the job of offering their customers upgrades to smart meters, and then installing them if the customers agrees (they are not compulsory). The original target for completing the roll-out of around 50 million meters was 2020, but with fewer than 20 million installed by mid-2019, the deadline is likely to be extended.

The aim with smart meters and the associated display monitor is to make bills accurate and to provide households and businesses with information on how much energy they are using, and how much it is costing. The belief is that this information will encourage people to use energy more efficiently, delivering savings in excess of £1 billion a year by 2030.

Types of smart meter

There are two main types of smart meters – the older models known as SMETS 1 (Smart Meter Equipment Technical Specifications), and the newer versions that were rolled from 2017, known as SMETS 2.

  • SMETS 1 – These generally communicate with your supplier through the 3G network. Originally, SMETS 1 meters could only communicate with the supplier who installed them, and if you switched they reverted to ‘dumb’ mode. But work is under way to upgrade SMETS 1 units so that they will remain ‘smart’ if the user switches to another supplier. If you have a SMETS 1 meter you should ask whether it will remain active if you switch supplier.
  • SMETS 2 – the new generation of smart meters use  more advanced technology and should allow switching to take place without any loss of capability.
  • There are separate meters for gas and electricity.

How do smart meters work?

Smart meters work by collecting information about your energy usage in near-real time (electricity) and every 30 minutes (gas), then both displaying it for you to see, and sending it to your energy provider. This information can include:

  • Your consumption: how much gas and electricity you have used in kilowatt hours in the last hour, week, and month.
  • Your spending: the amount you've spent in pounds is visible and updated every half an hour, every day.
  • Your energy goals: some Smart Meters come with budgeting functionality, which lets you set goals for reducing your energy consumption.

This means you’re able to get to grips with how much energy you’re using and how much it’s costing you, so you can think about making cutbacks if and when you need to. Your provider gets a clearer picture too – this means they can send you a more accurate bill, rather than just an estimate based on previous usage.

It also means you won’t need to take your meter readings yourself anymore, and nor will your provider have to send someone out on a house call – the information is sent automatically, so everyone is kept up to date.

A telematics policy is on average £201.64 cheaper for 17-21 year old drivers

Should I get a smart meter?

There are clear benefits to having a smart meter. First, you know your bills are accurate, because the information about your energy usage is sent directly to the supplier by the meter itself. That means you don’t have to take readings or wait in for someone to come to your house and do it. And if your bills are accurate there’s no likelihood of you accidentally slipping into arrears and eventually facing a painful ‘catch-up’ bill or higher monthly payments while the debt is cleared.

If you have a smart prepayment meter, it will show you how much credit you have, and you’ll be able to top it up without visiting a shop.

The second advantage is the display unit, which shows you how much energy you are using and how much it is costing you at any given point. This should help you identify where your money is going, which is the first step towards working out how to reduce consumption and cut your bills.

If you haven’t got a smart meter yet, contact your supplier. They’ll be happy to arrange a time to come and change over your old gas and electricity meters to the new smart versions.

See what areas of the UK use the most gas.

Data sourced from the UK Government, accurate as of November 2018

How are smart meters installed?

When it’s your turn to have a smart meter installed, the process is relatively simple. An engineer will temporarily suspend your energy supply, before swapping your old gas and electricity meters for the new smart meters and turning the power back on.

The new meters generally go where the old meters were located, but the engineer will let you know if they have to go somewhere else. If your old meters are very old, they could be more difficult to replace than more recent models, especially if they’re in hard to reach places.

What does a smart meter cost?

You’ll be pleased to hear that there is no upfront cost for a smart meter – instead the price of the whole smart meter programme is absorbed into everyone’s energy bills. The real time display should theoretically even lead to cost savings, as research suggests that people who monitor their energy consumption use less.

A telematics policy is on average £201.64 cheaper for 17-21 year old drivers

Prepayment and credit plans

If you’re a prepayment or pay-as-you-go customer you should also be eligible for a smart meter – however, it may depend on whether your provider offers them on a prepayment deal. If they do, then you could see extra benefits, such as:

  • Easier top-ups – some smart meters offer the ability to top up through the meter itself, or an app on your phone, tablet, or computer – saving you the hassle of going to the shops. You might even be able to set up automatic top-ups.
  • Monitoring – you’ll also be able to check on how much credit you’ve used so far, so you can stay in control of your consumption.
  • Alerts – if you’re running out of credit, your smart meter can also alert you through the in-home display.

If you’re a prepayment customer, having a smart meter could also make it easier to switch to a credit meter – the process generally just requires a software update. Credit meters let you pay your energy bill upon receipt, and you can often find better deals on tariffs when you pay this way – however, you should always compare quotes thoroughly to ensure you know what you’re getting and how much you’re paying for it.

Economy 7 and 10

Economy 7 tariffs give you cheaper rates during the night, and more expensive rates during the day. The cheaper rate period is usually seven hours, and with an Economy 10 tariff this goes up to 10 hours. These tariffs are known as ‘time of use’.

If you’re on economy 7 or 10, you might be able to get a smart meter as some suppliers are starting to offer ones that are able to juggle two tariffs – this could be especially useful as you’ll be able to see which tariff you’re currently using, and how much energy you’ve consumed under each.

However, this may not be available for all economy 7 and 10 providers, so you should talk to your energy company and get all the details before accepting a smart meter.

 

See what areas of the UK use the most electricity.

Percentage of households that have a high usage of electricity, according to the information input by customers when switching energy with MoneySuperMarket between January and February 2019. High usage is defined as more than 3,100 kWh during one year.

Do I have to have a smart meter?

No. Smart meters are not compulsory. However, you may find that some suppliers will only offer you a competitive tariff on condition that you have a smart meter fitted. New-build properties are now built with smart meters already installed. 

A third of customers choose a big 6 supplier when they switch energy

Data sourced from the UK Government, accurate as of November 2018

Will my data be protected if I have a smart meter?

Data protection is an important factor to consider when thinking about smart meters, because as with any online technology it can be vulnerable to hackers. However, the government has set rules about how your data can be used – you’ll have the option to choose:

  • How often your supplier can collect data from your smart meter – the minimum is monthly but you can also choose daily and half hourly
  • Whether they can share this with other companies and organisations
  • If they can use your data for marketing purposes

The choices you make regarding these matters aren’t permanent – you’ll always be able to change your preferences. If you have any queries about your data, you can always contact your provider to ask.

Are smart meters a health issue?

Some people may be concerned about the levels of radiation given off my smart meters. These meters give off microwaves, which in intense bursts can cause cancer, however British Gas and Cancer Research UK have stated that the levels of microwave radiation are actually lower than those given off by TVs, phones, and microwaves. As a result, they’ve been given the all clear to use in homes across the UK.

Is a smart meter the same as a smart thermostat?

Smart meters and smart thermostats are different devices – while meters provide you with information about usage and costs on an in-home display, smart thermostats instead enable you to control your thermostat via a phone, tablet, or computer, wherever you are.

A telematics policy is on average £201.64 cheaper for 17-21 year old drivers

Compare energy tariffs

Switching suppliers can be a good way to save money on your energy bill in general. On MoneySuperMarket, you can compare energy suppliers by factors like the estimated costs – given as an annual and monthly figure, as well as any early exit fees and the possible amount you could be saving a year.

All you have to do is answer a few questions about your home, like how many people are living there and how many bedrooms it has, as well as some about your energy usage – then you’ll be ready to look at different quotes so you can find a better deal on your gas and electricity costs.

Switch and save with Energy Monitor

Switching your energy supplier is quicker and easier with MoneySuperMarket’s Energy Monitor. We’ll let you know as soon as there’s a cheaper tariff available for you, so you can effortlessly switch and save money on your energy bill.

Smart meters for businesses

With a smart meter your business will be able to get a more accurate picture about how much energy you use, so you can be fully informed when you make decisions about your business’s gas and electricity. It can also be helpful in getting a more accurate quote if you and your business decide to switch energy suppliers – read our business energy section to learn more.

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