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Why Ed Miliband risks a smart meter shock

The little devices are key to Labour’s green plans – but malfunctions are harming their rollout

Smart meters, for many owners, have failed to live up to the name. Online forums are filled with complaints from people who have received huge bills or ridiculous consumption figures after energy suppliers installed the internet-connected meters in their homes.
In one case, a customer was billed over £1,000 a day for gas when his smart meter ignored the decimal points in his reading. In another, a smart meter in a communal hallway, home to just two lightbulbs, led to an estimated annual charge of £6,150.
The charity Citizens Advice says it has received complaints of shock bills of more than £1,000 after smart meters failed to send updates to energy suppliers, leading to people dramatically underestimating their usage.
In most cases, customers are able to resolve huge bills caused by faulty meters – after some hassling. But now, the Government has been accused of significantly understating the problem.
Martin Lewis, the consumer champion, has written to Ed Miliband, the Energy Secretary, claiming that 19pc – almost one in five – smart meters in operation do not work.
Statistics from the Department for Energy Security and Net Zero claim the number is much lower, at around 9pc. However, this only includes meters which are not sending readings to energy providers, excluding other faults.
Lewis said the official statistics did not include potentially millions of devices which were not communicating with displays, that are sending incorrect readings or failing to record top-ups.
His figures would suggest that almost 7m of the 36.2m smart meters installed in Britain today are malfunctioning in some way.
Non-functioning meters risk becoming a bigger problem in the coming years. Around 7m meters rely on 2G or 3G mobile connections that are scheduled to be switched off by the end of 2033 and will need their communications modules replaced so they can use modern phone networks.
The issue of smart meters turning “dumb” is alarming not just to consumer campaigners such as Lewis but also to the industry.
A spokesman for Octopus Energy said: “Customer experience with smart meters is essential to building confidence in this transition. Satisfied customers with working smart meters also often advocate for them, helping to drive overall installations and confidence.”
The company has said it is focusing on fixing any broken meters it finds as a priority.
Dhara Vyas, deputy chief executive of Energy UK, which speaks for the industry as a whole, agreed that authorities should look at energy suppliers’ targets.
She said: “As we complete the smart meter rollout, it’s going to be very important to look at the role of targets and ensuring these are properly serving customers’ interests and hitting the right balance between installation of new meters and maintenance of existing ones.” 
Failing smart meters are more than just an inconvenience for homeowners – they also threaten to undermine the Government’s net zero push. The devices will play an ever-more crucial role in managing the electricity system as the nation shifts to renewable energy, say experts.
Lewis has taken issue with the fact that while energy suppliers were under binding targets to install smart meters, they had few responsibilities to maintain existing ones. He called for targets to be overhauled to cover the number of “working” meters, rather than simply targeting the number that were installed.
“Smart meters, done right, offer an exciting future,” he wrote. “It’s just a shame the overly-long history of the smart meter rollout is one of sloth, poor decisions, poor technology and over-expense.”
Miliband is the architect of Britain’s smart meter rollout. As energy secretary under the last Labour government, he announced in 2008 that every home in Britain would have a smart meter by 2019.
The target has repeatedly been delayed and watered down – the current target is three-quarters of households by the end of 2025.
Even that target may be unobtainable. Although 64pc of homes had a smart meter at the end of June, installations have dropped dramatically.
Large energy suppliers installed 663,167 in the second quarter of the year, down by 15pc year-on-year. Outside lockdowns, this was the lowest quarterly figure for more than eight years.
The slowdown comes despite electricity prices soaring, which should make the financial benefits of smart meters more apparent.
The devices give households real-time data on their consumption. The displays only have a marginal effect on electricity and gas usage, according to government research.
The real benefits lie in sending half-hourly updates to the grid, which allows suppliers to balance out electricity usage by charging more during peak hours and less during quieter periods.
A growing number of energy suppliers has launched tariffs allowing households to take advantage of cheaper electricity during off-peak times, such as when charging electric vehicles at night.
Last winter, 1.6m households took advantage of schemes rewarding homeowners for cutting electricity usage at peak times.
In fact, Octopus Energy, the UK’s largest electricity supplier, now pays people to use electricity at certain times in response to a quirk in how the grid buys energy.
The troubled smart meter rollout has an impact beyond individual households – it will also influence net zero.
The types of energy management schemes employed by Octopus and other energy providers are likely to become more crucial as Labour seeks to make Britain’s electricity network run entirely on clean power by the end of the decade, relying more on intermittent sources such as wind and solar.
“It’s small now, but it will become increasingly important, especially as we get through the 2030s and into the 2040s,” says Matthew Lockwood, of the Sussex Energy Group at the University of Sussex.
“With smart meters, what governments have tried to do is to get the infrastructure to facilitate all of this in place ahead of mass demand.”
He predicts that while consumers have been slow to take advantage of the devices, that will change with a more digitally-literate population.
Lewis, however, says the number of malfunctioning devices is deterring uptake.
“Too many smart meters don’t work,” he told Miliband. “The industry can pump all the money it likes at marketing them, but when word of mouth is often saying ‘don’t bother’, it’s tough to shift the dial.”
An Octopus spokesman said the company prioritised fixing broken meters over installing new ones.
The company said: “Installing meters that don’t function properly not only undermines customer trust but also delays the larger transition to a smarter, more sustainable energy system.”
The Government called on suppliers to fix problems more quickly and called on Ofgem, the energy regulator, to step up enforcement. 
“While over 90pc of smart meters are operating normally, the number in traditional mode is still too high – meaning many households are missing out on cheaper, flexible tariffs,” a spokesman for the Department for Energy Security and Net Zero said.
“We expect energy suppliers to resolve any issues with their customers’ meters at a much faster pace, with Ofgem responsible for holding them to account.”
If Labour intends to follow through on its net zero commitments, homeowners will not only have to be sold on the benefits of smart meters – they will need more confidence that the devices actually work.

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