Smart Meters

What are smart meters?

Smart meters are advanced gas and electric meters. They transmit energy readings to your supplier automatically without the need for manual readings. It means estimated bills are no longer necessary and they may pave the way for new types of tariff and more ‘intelligent’ pricing systems.

Smart meters don’t really tell you much about your energy usage in the home, but they usually come with a form of energy monitor, which allows you to watch your energy usage more carefully.

The government estimates that you will save around £23 a year through using these new meters, but that is down to personal changes as a result of the information provided by the meter not actual changes they initiate.

What are the advantages?

    • No more estimated bills – you pay for what you use.
    • They come with energy monitors that allow you to better check your energy usage, and make necessary changes. It will also allow better energy budgeting and tracking and personalized energy efficiency tips from the energy company.
    • They allow for future improvements to energy tariffs – varying rates for different times of day for example, helping you profit from cheaper electricity when demand is lower.
    • It is hoped it will make it easier to switch supplier, as the meters can send all the relevant information to the new supplier instantly.
    • Energy companies can use smart meters to set tariffs that will help even demand during the day by charging more at peak times and less at offpeak times. This means that the installed peak capacity can be reduced.
    • As our energy mix becomes more complicated, as a result of more energy sources feeding into it – energy companies can use the smart grid to better manage supply and demand.

What are the disadvantages of smart meters?

Criticism of smart meters has been fierce, especially in areas where their installation has been compulsory. The main reasons for opposition are largely based around cost and privacy issues. Installation of the meters does not come cheap for the energy companies, and it companies inevitably try and pass on the cost to the customer, whether directly or indirectly.

Some customers believe it will result in higher bills in future due to the billions it will cost to change the whole grid over to the new meters.

It is thought by some that smart meters provide energy companies with too much information about their customers. Theoretically a company would be able to monitor when you are using energy in your home, and thus your usage patterns. This could lead to things like targeted advertising and marketing for example.

There have been questions of health implications, because of the wireless nature of their feedback to the energy company, though there is no evidence to support this.

Where are smart meters being used and what is the current feeling?

Smart meters have been piloted in a number of countries, and some regions are further along the road than others. America has seen a huge roll out of the meters in a number of states, with much debate on either side over the schemes. Some regions have put a moratorium on the meters, whilst others have embraced them fully.

The effectiveness of the meters in altering usage patterns is still in debate. Some studies show larger changes in usage than others. One large-scale study in the US showed that even with new load based tariffs, only 9% of customers actually reduced their peak load. It still remains to be seen just how much these new meters will help cut usage on a larger scale.

What is the future for smart meters in the UK?

In Britain, the Government wants smart meters in 80% of homes by 2020. So chances are you will be getting one soon (in fact I have just seen an advert with British Gas offering them). You can speak to your energy company about their plans and when you might be able to get one.

Like it or not, smart meters are coming, so you should be aware of them and what to expect. In our opinion, If you actually engage with the process and the technology that is installed you have the potential to save a decent amount of money – but energy usage habits will have to change!


    • Since the energy companies can see exactly how much electricity you use, gone are the days of estimated bills!
    • Since smart meters don’t need to be read manually like existing electricity meters, the energy companies should have reduced admin costs, which will hopefully be reflected in the price the consumer pays.
    • Energy companies will also be able to better manage supply and demand of the grid, which will actually lead to a reduction in peak demand. This means that less older, more inefficient power plants will need to fire up therefore the carbon footprint of the energy mix will reduce.


    • Having an energy meter in your home means the energy companies can see your energy usage – so there are some privacy concerns.


    • Most energy companies are now offering free smart meter installation for their customers.

Learn more about the Smart Grid – Click on the links below!

The Current National Grid

Features of the Smart Grid

Consumers and the Smart Grid

Energy Companies and the Smart Grid

Time of Use Tariff