Smart meters will cost each British household £420 and save people just “a tenner a year”, according to reports.
Cost-benefit estimates for the British smart meter programme vary hugely, with figures ranging from modest savings of around £26 a year (as we reported last year) to the Mail on Sunday’s latest guess coming from Gordon Hughes, an economist at the University of Edinburgh.
“The introduction of the smart meter is a dog's breakfast. At best it is misconceived and an astonishingly expensive project. For those claiming it will bring major savings, I say they need to grow up,” Hughes dutifully raged for the Sunday newspaper.
The £11bn project, which came about in part because of European Union directive 2009/72/EC, snappily titled “Directive 2009/72/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in electricity and repealing Directive 2003/54/EC (Text with EEA relevance)”, along with a similar directive on gas meters, is supposed to put smart meters into 80 per cent of households by the year 2020.
An EU webpage last updated a couple of weeks ago says the UK is on track to meet this target, though the source of its claim is unclear. The same page states: “While cost estimates vary, the cost of a smart metering system averages between €200 and €250 [£184 - £230] per customer, while delivering benefits per metering point of €160 [£147] for gas and €309 [£284] for electricity along with, on average, three per cent energy savings.”
Four years ago a British report revealed that the cost of installing smart meters in the UK is £390 per household, while more recent estimates are that the benefits are now as low as £11 per household, agreeing with the University of Edinburgh’s Hughes’ estimates to the Mail on Sunday. All costs for installing the UK smart meter network, from the backend systems to the consumer unit in your home, are met by hiking up your gas and electricity bills.
A Dutch study from earlier this year also found that some smart meters are capable of giving wildly inaccurate readings, exaggerating energy consumption by up to 582 per cent.
The hugely expensive project was not helped when El Reg revealed that the monopoly comms hub supplier for the north of the UK, EDMI, wanted millions of pounds to change a single component in its hub.
As government figures have gradually watered down their language when referring to the project – the Conservatives’ 2016 manifesto referred to “offering” smart meters to households – it could be inferred that the “80 per cent coverage by 2020” target will be missed. Estimates vary widely over how many have been installed so far but the figure appears to be somewhere in the low millions, as compared to the UK’s 27 million households.
With the UK slated to leave the EU by 2020, it is unlikely that any financial penalties will result if the target is missed. ®