The £8.1 billion rollout of smart meters in Britain could be knocked off course unless the Government and Ofgem, the energy regulator, act urgently to convince the public that the information provided by the meters will be held securely.
Fears that data on energy consumption could be misused by criminals, police or insurance companies have curtailed the compulsory introduction of the meters in the Netherlands, according to a report by Datamonitor, the market analyst.
Dutch consumer and privacy organisations were concerned that information relayed as frequently as every 15 minutes could allow employees of utility companies to see when properties were empty or when householders had bought expensive new gadgets.
Smart meters, which are due to be rolled out to the UK’s 26 million households by 2020, are fitted with information and communications technology so that they can send data and receive instructions. The intention is that they will transform the energy industry — enabling the transition to a low-carbon economy — but utilities have been frustrated at the delay to agreeing a common model and standards for use.
Now Datamonitor is warning that the introduction of smart metering will rival the creation of the internet as a telecommunications project and will stretch utility industry practices and processes to breaking point.
Alex Desbarres, senior renewables analyst at Datamonitor and co-author of the report, said: “The Government and the regulator have to decide what they want the programme to achieve and then they have to quickly establish a dialogue with consumer groups and the general public.
“The backlash against smart meters could be aggressive if the message that they will reduce energy consumption and help lower carbon emissions is not made clear. The Government also has to address these privacy and security issues. Many people do not like the idea of utility companies having a permanent window on their private life.
“What is the industry going to do with all this data? At the moment, they do not have the processes to manage it — and without significant new systems the data itself is worthless.”
A new communications centre will be created to receive and manage the data from the meters to make it easier for customers to switch suppliers.
According to Datamonitor’s report, the present trials of smart meters, which are being conducted with four of the leading suppliers, are throwing up potential problems, including issues about access to properties and the need for rewiring and repiping. Datamonitor says that all suppliers have had difficulty obtaining and installing the necessary equipment for trials, illustrating the relative immaturity of the technologies.
A spokesman for the Department of Energy and Climate Change said that the privacy and security issues were being addressed: “Data protection and system security are crucial issues for the success of the rollout and operation of the smart metering and will be a vital part of the implementation work we will be doing. We will take a rigorous and systematic approach to assessing and managing these issues.”
A spokesman for Ofgem said: “Ofgem’s main concern is that the interests of consumers are protected when smart meters are introduced. Data protection and system security are crucial issues for consumers and we will take a rigorous and systematic approach to assessing and managing these issues. This will include stringent rules and safeguards.”
Energy UK, which represents the six main gas and electricity suppliers, said: “The industry has been working flat out to develop the smart metering programme since 2006 and continues to take on board lessons from other programmes around the world.”
The European Union said in 2006 that smart meters should be made mandatory, but voters in the Netherlands have vigorously opposed a compulsory rollout and succeeded in persuading politicians to vote against it.
Smart meters are expected to lead to the introduction of more variable price tariffs, based on time of day. It should be possible to charge consumers more at peak hours, which in turn would encourage many people to use electricity in periods of lower demand.
Flicking the switch
Dutch consumer and privacy organisations were concerned that information relayed as frequently as every 15 minutes could allow employees of utility companies to see when properties were empty or when householders had bought expensive new gadgets.
Smart meters, which are due to be rolled out to the UK’s 26 million households by 2020, are fitted with information and communications technology so that they can send data and receive instructions. The intention is that they will transform the energy industry — enabling the transition to a low-carbon economy — but utilities have been frustrated at the delay to agreeing a common model and standards for use.
Now Datamonitor is warning that the introduction of smart metering will rival the creation of the internet as a telecommunications project and will stretch utility industry practices and processes to breaking point.
Alex Desbarres, senior renewables analyst at Datamonitor and co-author of the report, said: “The Government and the regulator have to decide what they want the programme to achieve and then they have to quickly establish a dialogue with consumer groups and the general public.
“The backlash against smart meters could be aggressive if the message that they will reduce energy consumption and help lower carbon emissions is not made clear. The Government also has to address these privacy and security issues. Many people do not like the idea of utility companies having a permanent window on their private life.
“What is the industry going to do with all this data? At the moment, they do not have the processes to manage it — and without significant new systems the data itself is worthless.”
A new communications centre will be created to receive and manage the data from the meters to make it easier for customers to switch suppliers.
According to Datamonitor’s report, the present trials of smart meters, which are being conducted with four of the leading suppliers, are throwing up potential problems, including issues about access to properties and the need for rewiring and repiping. Datamonitor says that all suppliers have had difficulty obtaining and installing the necessary equipment for trials, illustrating the relative immaturity of the technologies.
A spokesman for the Department of Energy and Climate Change said that the privacy and security issues were being addressed: “Data protection and system security are crucial issues for the success of the rollout and operation of the smart metering and will be a vital part of the implementation work we will be doing. We will take a rigorous and systematic approach to assessing and managing these issues.”
A spokesman for Ofgem said: “Ofgem’s main concern is that the interests of consumers are protected when smart meters are introduced. Data protection and system security are crucial issues for consumers and we will take a rigorous and systematic approach to assessing and managing these issues. This will include stringent rules and safeguards.”
Energy UK, which represents the six main gas and electricity suppliers, said: “The industry has been working flat out to develop the smart metering programme since 2006 and continues to take on board lessons from other programmes around the world.”
The European Union said in 2006 that smart meters should be made mandatory, but voters in the Netherlands have vigorously opposed a compulsory rollout and succeeded in persuading politicians to vote against it.
Smart meters are expected to lead to the introduction of more variable price tariffs, based on time of day. It should be possible to charge consumers more at peak hours, which in turn would encourage many people to use electricity in periods of lower demand.
Flicking the switch
- The Department of Energy and Climate Change wants to see 47 million meters in 26 million properties by 2020
- Trials suggest that the £8.1 billion scheme may help people to save £28 a year
- Smart meters have a visual display allowing customers to see exactly how much electricity and gas they are using and relay the data to energy suppliers automatically
- Energy suppliers will be responsible for the roll-out of the meters at a cost of about £340 per household.
- UK homes add £33 a year to bills by leaving appliances on standby
Source: The Times
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