Around four million first-generation smart meters had not been migrated to the central platform service by the end of 2022, despite government's requirement that this be complete by the end of 20221. The figure is set out in the National Audit Office's update on the rollout of smart meters, published on 14 June 20231.
The same report records that in September 2022 the central platform service provider told the Department for Energy Security & Net Zero (then BEIS) that device technical limitations meant it may not be possible to migrate more than 500,000 smart meters1. The NAO does not state in the quoted material how many meters were eventually migrated, or when the remaining migration is expected to finish; those points have not been reported1.
The migration sits inside a wider rollout that has repeatedly slipped. Government first announced its intention to mandate suppliers to install smart meters in 2008, set a vision in 2011 for every home and small business in Great Britain to have one with completion intended in 2019, placed a legal obligation on suppliers in 2012 to take "all reasonable steps" to install them by 2019, extended that deadline to 2020 in 2013, withdrew a proposed four-year framework in 2020 because of the COVID-19 pandemic, and in 2022 introduced a framework running to the end of 2025 with annual, individual installation targets1.
As at the end of March 2023, 57% of all electricity and gas meters were smart, 32.4 million out of 57.1 million1. Of those 32.4 million installed smart meters, 9%, around three million, were not operating in smart mode and were effectively indistinguishable from a traditional meter, meaning they had technical issues, did not send energy use information to suppliers and may not display it to consumers1. Government's proposal is for 80% of meters in homes to be smart by the end of 20251.
| Measure | Figure |
|---|---|
| Smart meters as share of all electricity and gas meters, end March 2023 | 57% (32.4 million of 57.1 million)1 |
| Installed smart meters not operating in smart mode, end March 2023 | 9%, around three million1 |
| Government proposal for homes smart by end 2025 | 80%1 |
| Indicative annual saving for a typical dual fuel household with a smart meter, March 2023 | £561 |
The NAO gives government's 2019 estimate of the cost of the rollout to energy suppliers as £13.5 billion over 2013 to 2034, in 2011 prices, with suppliers passing on some or all of their costs to energy consumers, against estimated benefits of £19.5 billion over the same period, a net benefit of £6 billion driven primarily by supplier cost savings and reduced energy use and bills for consumers1. The indicative annual saving of £56 for a typical dual fuel household with a smart meter as at March 2023 assumes the Energy Price Guarantee is in place1.
"In September 2022, the central platform service provider told DESNZ that device technical limitations meant that it may not be possible to migrate more than 500,000 smart meters."
Why it matters for households
A first-generation meter that has not been migrated can keep working, but it may not deliver the automatic readings and remote functions that make a smart meter useful for monitoring a home's energy use. The NAO's finding that around three million installed meters were not operating in smart mode as at March 2023 means a significant number of households hold hardware that behaves like a traditional meter, which is the situation behind estimated bills with a smart meter. The pace of the wider smart meter rollout also shapes when households can access time-of-use tariffs and flexibility services, which the NAO says are likely to become more widespread after April 2025, when Ofgem expects industry to have commenced migration to new half-hourly settlement arrangements across the retail electricity market1.
What happens next
The NAO records that Alt HAN technology, which extends smart meter connectivity in harder-to-reach homes, was being piloted by some suppliers and, subject to the outcome of the pilot, was due to be rolled out from July 20231. DESNZ expects a technical solution allowing smart meters to function in more than 99% of homes to be available from July 2023, against 96.5% of homes where it expects smart meters can now technically function1. In 2023 government consulted with energy suppliers and other stakeholders on achieving 80% minimum domestic smart meter coverage and 73% minimum coverage in small businesses by the end of 2025, and in April 2023 Ofgem told suppliers they should have the capacity and flexibility of resource to meet their installation targets1. Smart DCC's licence is due to expire in 20251.
Sources1 cited
- Update on the rollout of smart meters, nao.org.uk