There are nearly 26m smart meters in the UK, and while they’ve had a mixed reception since they were first introduced in 2011, many are considering whether installing one could help them reduce soaring energy costs.
Here we explain what smart meters are, how they work and some of their advantages and disadvantages.
What is a smart meter?
Measuring energy usage has come a long way since the first gas and electric meters were invented, with smart meters simply the most recent innovation of this technology.
Smart meters serve the same purpose as a traditional meter, but they automate the meter reading process, sending your readings directly to your supplier. This means in theory no more submitting meter readings to get accurate energy bills, although some people have reported faults with their meters which have resulted in incorrect readings.
When a smart meter is installed in your home, you should also get an in-home display (IHD), a small device that lets you see how much energy you are using in pounds and kilowatt-hours as you use it. The idea is that being able to see exactly what you are spending at any time of day will help you reduce your energy usage and therefore your bills.
How do smart meters work?
Electricity smart meters are connected to your mains and they monitor the amount of electricity you use in real-time, while gas smart meters generally collect readings every half an hour, and these readings are usually sent to your supplier at least once a month. The nitty-gritty of how your meter works, such as which networks it uses to send information and its functions, depends on the type of meter you’ve had installed. There are currently two different types of smart meters available:
SMETS 1 meters
These were the first generation of smart meters that were initially rolled out and are the most common type, with around 15m of them currently in use across the UK. SMETS 1 meters use 3G to send your readings to your supplier.
One thing to be aware of with SMETS 1 meters is that if you decide to switch suppliers, your meter might go ‘dumb’ while they transfer your account. This basically means your meter won’t send readings automatically for a period of time and you will have to send meter readings until the switch has been processed fully.
SMETS 2 meters
These are the second generation of smart meters which are now being installed across the UK. One of the biggest differences from the SMETS1 is that rather than using 3G to send your readings, SMETS2 meters use a central data network, which is more secure so your information is better protected. This network is used by all energy suppliers who provide smart meters, so if you decide to switch suppliers, your meter shouldn’t go dumb anymore.
What are the advantages of a smart meter?
Assuming your smart meter works as it should – and there are plenty of reports that many of them don’t – it will provide you with the following benefits.
No more submitting meter readings
With a smart meter, your meter readings will automatically be sent to your supplier, so you don’t need to worry about remembering to submit your readings anymore.
No estimated bills
Energy suppliers estimate how much energy you are likely to use and then adjust it according to your meter readings. With automatic meter readings, you will only pay for exactly what you’ve used.
More control over your energy spend
The IHD device you will be given when you get a smart meter can help you understand exactly how much energy you are using and when. For example, it might help you realise just how much you are spending by leaving your TV on standby, or how much nudging your heating up a couple of degrees really costs.
Find faults before they become a problem
Your IHD can also help you spot any unexpected or sudden spikes in your energy use. This can be a sign that there is a fault somewhere, perhaps an appliance that’s on its last legs, or is particularly energy inefficient, enabling you to take action and resolve the problem.
Reduce your energy use
People with smart meters in their homes tend to have a better awareness of their energy use and are more easily able to find efficiencies, which is a plus for the planet and for your pocket.
Prepayment friendly
It’s not just those who pay monthly or quarterly for their energy supply that can benefit from a smart meter, prepayment customers might also get some specific benefits from having one installed.
These include more flexibility in the way you top up. As smart meters become more commonplace, you may not need to visit a shop to top up, your in-house display will show your credit balance, and you may be able to set automatic top-ups. Having a smart meter could also provide you with greater flexibility when switching between tariffs.
What are the disadvantages of a smart meter?
While the government originally had plans for every home to have a smart meter installed by 2020, this has now been pushed back to 2025. As a result, there can be long waiting lists to get one installed. On top of this, you might find that your supplier doesn’t even offer them yet, so you will need to switch suppliers before you can get one, potentially making your wait even longer. Some of the other issues you might have with a smart meter include the following:
Poor signal
Particularly for the SMETS 1 meters, poor mobile signal affects your meter’s ability to send your readings to your supplier. Ofcom suggests that 4% of the UK landmass has no good network coverage at all, a number that is shrinking, but means if you have the first generation meter, it may not be that reliable.
Difficulty switching
As mentioned, if you have a SMETS 1 meter then switching suppliers can disrupt to your smart meter, meaning it will go ‘dumb’ when you switch and you will have to submit manual readings until the switch is fully processed.
The Data Communications Company (DCC) has however started a process of connecting SMETS 1 meter into the same network, which should cause less disruption when you switch.
If you’re considering switching your energy provider, it’s worth doing plenty of research so you can be certain you’ve found the best possible deal to suit your needs. Comparison websites such as MoneySuperMarket, Uswitch and Compare the Market enable you to compare the latest energy tariffs, whether you’re looking for a fixed or variable deal.
Inaccurate IHD device information
Depending on how far away your IHD is from your meter, you might find that it provides inaccurate or inconsistent information, or stops working completely. You may find you have to keep it in a specific location or it won’t work properly.
Will a smart meter save me money?
The short answer is it could help you to create habits that save money, but the smart meter itself will not put pennies in your pocket.
With more information about energy usage, many people are able to identify what items in their homes are their biggest energy suckers and find ways to use them more efficiently.
For example, many people opt for a ‘quick wash’ on their washing machine assuming that the less time the machine is running, the cheaper it will be, but on some machines, opting for a longer eco mode actually works out cheaper. Eco modes often use less water and wash at cooler temperatures, but for longer times, and as 90% of a washing machine’s energy consumption comes from heating water, according to Currys, the eco mode could help you save money.
How do I get a smart meter?
The simplest way to get a smart meter is to contact your energy supplier or visit their website to see if they provide this service. They might have already contacted you and even if you said no to getting one installed before, you can still get one now. If you are struggling to find the information through your supplier, the charity Smart Meters has this handy tool to help you to request a smart meter.
Rest Less Money is on Instagram! Check out our account and give us a follow @rest_less_uk_money for all the latest Money News, updated daily.
* Links with an * by them are affiliate links which help Rest Less stay free to use as they can result in a payment or benefit to us. You can read more on how we make money here.
Get more for your money with Raisin UK
Raisin UK provides a free-to-use savings platform that allows savers to browse, open, and manage accounts with over 40 FSCS-protected banks and building societies.
Apply for savings accounts in just a few clicks, and they’ll handle the rest. Sit back, relax, and skip the paperwork as you watch your money grow.