With energy suppliers increasing their prices across the UK, it’s no wonder that many consumers are racking their brains to figure out how they can save money. Switching to fixed energy prices is one option if you are worried about price rises. There are also a number of ways to monitor energy consumption within the home, including energy monitors and plug-in meters.
A growing number of households are also now being installed with smart meters. Because not all households have them, some people confuse smart meters with energy monitors, but they are actually two quite different things.
What is a smart meter?
Smart meters are installed by energy suppliers. Unlike energy monitors, which you can simply buy and hook up to your electricity meter (or gas meter, in some cases) to monitor energy usage in the home, smart meters actually replace your current meters and send the information on energy consumption directly to your energy supplier. Smart meters do also have a display screen, so as with energy monitors you can keep track of consumption yourself. Usefully, smart meters measure both gas and electricity usage, whereas most energy monitors only calculate electricity usage. As with energy monitors, the display will also tell you how much energy usage is costing you.
Smart meters are already being installed by companies such as British Gas, and many other suppliers will be following soon. The government’s minimum aim is to have 80 per cent of households with smart meters by 2020. Installation typically takes one to two hours and is carried out by trained installers. Householders with both gas and electricity will receive a meter for each utility. Smart gas meters are battery-powered and about the same size as current gas meters, while smart electricity meters are mains-powered and slightly larger than current electricity meters.
What are the impacts of smart meters on energy savings and spending?
Smart meters are designed to cut energy consumption by making consumers aware of how much energy they consume and also, by sending the information directly to companies, to enable bills to be calculated more accurately. The real-time display screen means that you can monitor how much energy certain appliances use in the same way as for a standard energy monitor. This enables consumers to modify their energy habits and save money.
By providing more accurate bills based on actual rather than estimated usage, smart meters also ensure that consumers do not end up overpaying on a regular basis for their gas or electricity. This can be a common problem as suppliers tend to overestimate rather than underestimate usage. Again, all good news and this can end up saving you money if paying high bills is an issue.
However, it is estimated that installing smart meters across the UK will cost at least £11 billion, and consumers could easily end up paying for this through their bills. Smart meters will also need to be replaced more often than standard meters.
The other issue that is a concern while different suppliers are installing smart meters at different times is that it could make switching energy suppliers more problematic. Up until now, smart meters have been switched to ‘dumb mode’, or different meters installed. Fortunately, from 2014 if you want to switch, and already have a smart meter, the new supplier is obliged to continue to provide you with smart gas or electricity. So you can continue to switch suppliers to take advantage of cheaper energy tariffs in just the same way as normal. In the future, smart meters may even make this process quicker and easier.
This post was published in conjunction with Ovoenergy.com