The race to meet the smart meter deadline

This month, government launched a new smart meter framework which aims to boost the rollout. Nadine Buddoo looks at what suppliers should be focusing on to avoid further delays.

The four-year Targets Framework seeks to drive the long-term investment required to support the smart meter rollout for homes and small businesses across Great Britain.

According to government, the new framework will ensure the rollout continues at pace and will be under constant review. As part of this, energy suppliers will be set annual, individual installation targets on a trajectory to 100% coverage, within tolerance levels.

But while the smart meter programme has been plagued by delays, 2021 was the biggest year yet for the national rollout. By September 2021, 26.4 million smart and advanced meters had been installed, representing 47% of coverage.

The latest data signals the installation programme is partially recovering after the crippling impact of Covid-19 and lengthy lockdown restrictions. Largely due to the pandemic, 2020 saw a 27% decrease in installations of smart electricity meters compared to 2019 – the lowest tally since 2016, according to figures from Electralink’s data transfer service team.

However, figures for 2021 show that installations were up 21% on the previous year.

Smart DCC CEO Angus Flett insists that the rollout’s current trajectory will continue and 2022 will be the year that smart meters outnumber traditional analogue meters.

“The growth of our network is due to the hard work of the DCC’s customers, the energy suppliers and network operators. They’ve not only kept installation rates strong…they’ve embraced technologies at scale that are helping us reach more homes and small businesses – such as dual band communications.”

Delayed start

Suppliers’ deadline for the rollout was originally slated for the end of 2020. However, in 2019, beset by delays primarily due to ongoing technical issues with metering equipment, government pushed the deadline back to 2024.

Following further delays, largely attributed to the coronavirus pandemic and subsequent lockdown restrictions, the deadline has now been extended to the end of 2025.

Fflur Lawton, head of public affairs at Smart Energy GB, says that while the pandemic caused a slowdown in the rollout, the revised deadline is achievable and gives suppliers more time to plan ahead.

So as the rollout nears the halfway mark, what should suppliers be focused on as they eye their new annual targets?

According to Lawton, bringing innovations forward that make it more appealing for consumers to get a smart meter and use that data will be hugely important. She adds that there are significant opportunities to provide more choice for customers through developments such as time-of-use tariffs or more flexible payment methods.

“Prepayment is a really good example of this,” Lawton tells UW Innovate. “Smart prepayment meters mean that people can top up at home. They don’t have to go to a shop, particularly during lockdown when that was a real challenge.

“It’s far more flexible and a much better system. Those sorts of things coming though help people to see the appeal of smart meters.”

Lawton says it is encouraging that these types of innovations are already coming to market both for domestic and non-domestic customers. “Looking at smaller businesses, given what they’ve been through with the pandemic and everything else, having a smart meter and the data that provides will give them some control over their energy costs,” she adds. “You wouldn’t go to a garage and not know how much it is going to cost to fill up your car, so why are we doing the same with energy?”

But the current landscape for energy retailers – and their customers – is fraught with complexities, which raises the question of whether the rollout is at risk of being pushed further down the agenda.

Tackling the energy crisis

In 2018 there were more than 70 suppliers in the market – now there are less than 30. With more energy companies likely to collapse before the end of this year, many customers are facing soaring bills and growing concerns over the anticipated price hike in April. It remains to be seen how this uncertainty and financial pressure will impact consumer appetite for smart metering.

Lawton says that giving customers increased visibility and control of their energy consumption through smart metering has never been more important. “People can see the benefits of understanding in pounds and pence what they’re spending their money on,” she adds.

While customer awareness is high, according to Lawton, the next phase of the rollout must involve converting that “awareness into seek”. “We want to make sure that people are contacting their energy supplier to ask for a smart meter installation. That’s the critical bit for us,” she explains. “We’ve got high levels of awareness…but it’s really important that we convert those and get people to take action. That’s the challenge.”

The road to digitalisation

Another significant challenge will be ensuring that the smart meter rollout is aligned with a wider  vision for a smart, digitalised energy system.

Speaking at the launch of the Energy Digitalisation Taskforce’s report – Delivering a digitalised energy system – chair Laura Sandys acknowledged the importance of the rollout but warned against becoming fixated on “a piece of hardware” rather than focusing on the wider outcomes that can be delivered.

“There are digital and database solutions that can actually deliver similar outcomes. I think it’s about working together between database solutions and fixed metering,” she said.

Also speaking at the event, Richard Dobson, practice manager – data systems at Energy Systems Catapult, agreed that the rollout is a critical programme for the energy sector but insisted that there are “many more things that we need to do to get to a smart, digitalised energy system”.

“We need to make sure that we’re pushing on with digitalisation more generally because that will unlock huge value in the energy system,” he added.

“Some of that can be realised through metering and some of it doesn’t necessarily need to be.”