The government must mandate the installation of smart meters in consumers’ homes if it hopes to complete the rollout of the devices by the end of 2025, an industry boss has said.
Bill Bullen, chief executive of Utilita, was speaking to Utility Week following analysis by Cornwall Insight suggesting that energy suppliers “face an uphill struggle” to meet the government’s rollout target.
According to the latest figures at the end of 2022 there were 31.3 million smart and advanced meters in Great Britain in homes and small businesses. Of these, 28.1 million were smart meters operating in smart mode or advanced meters. In total just 55% of meters operating were smart despite the rollout having been ongoing for more than a decade.
Utilita is a prepayment meter (PPM) specialist supplier which has achieved 90% smart meter coverage overall, increasing to 95% among its prepay cohort, and Bullen believes this is down to its digital offering to consumers.
He said: “It’s just getting more and more difficult to get people to cooperate with an installation. We’ve been at it a long time, we’ve got an offering that customers generally really like but we’re still short of 95% so I don’t think we’re ever going to get to 100% unless the government mandates it.
“Are we going to get close to even 90% by 2025? I can’t see it happening to be honest with you. It seems very unlikely. If we carry on at the same pace, we won’t be anywhere like that, we’ll be more like 75%…obviously I’m not party to everybody else’s installation plans.
“We are so near completion ourselves that anything we do isn’t really going to make much difference to the overall. But we are finding it more and more difficult ourselves to get meters installed.”
It comes as Mikael Mahmud, consumer markets analyst at Cornwall Insight, warned of the hurdles facing suppliers on the road to 2025.
He said: “Smart meters have been shown to decrease bills and reduce peak time energy consumption. Additionally getting to 100% coverage would be an important milestone for other industry workstreams such as market-wide half hourly settlement, helping to support flexible energy use and facilitate the transition to net zero.
“However, while suppliers have made progress in increasing their smart meter rollout, if they are to keep within realistic goals, they face an uphill struggle to meet the government’s 100% target.
“Given the number of variables in play, from the upfront costs incurred by suppliers, through to customer willingness to install the meters, the government must weigh carefully their 100% coverage goal against the acceptable tolerance level, which allows suppliers to deviate from their targets.
“It’s important to acknowledge that hitting or missing installation targets may not always be within the supplier’s control.”
An Energy UK spokesperson said in response: “Suppliers are working to complete the rollout of smart meters as quickly as possible and have strong incentives to do so, as they offer a better customer experience to traditional metering and enable a wider range of products and services. Smart meters are also critical to preparing our energy system to become more flexible – reducing our reliance on gas and meeting government’s net zero emissions target.
“Industry is keen to work with government and others to complete the rollout as quickly and efficiently as possible, at a cost which is fair and acceptable to all customers. As an ‘opt-in’ option for customers, it is vital government, Ofgem and suppliers work together to ensure consumers understand the benefits smart meters bring.”
Meanwhile a Department for Energy Security and Net Zero spokesperson said: “Smart meters are making our energy system more efficient and flexible, and there are now more than 30 million installed in homes and small business across Great Britain.
“We require energy suppliers to work towards annual targets in order to drive continued investment at scale by industry. Achieving our smart metering targets will help consumers manage their energy use, enable us to use more renewable energy, and reduce our reliance on imported fossil fuels.”