The Department for Energy Security & Net Zero (DESNZ) expects a technical solution that would allow smart meters to function in more than 99% of homes to be available from July 2023, according to a National Audit Office report published on 14 June 20231. The technology, known as Alt HAN, is being piloted by some suppliers and is aimed at sites where the signal that smart meters use to send data is blocked, such as high-rise flats2.
The report puts current coverage in context. As at the end of March 2023, 57% of all electricity and gas meters were smart, 32.4 million out of 57.1 million2. DESNZ expects it is now technically possible for smart meters to function in 96.5% of homes, with the new solution intended to raise that figure above 99%1.
"Alt HAN technology is being piloted by some suppliers and, subject to the outcome of the pilot, is due to be rolled out from July 2023."
The rollout has run well past its original timetable. Government set out a vision in 2011 for every home and small business in Great Britain to have smart meters, with an intention to effectively complete the rollout in 20191. A legal obligation on suppliers to take "all reasonable steps" followed in 2012, with the deadline extended to 2020, then to the end of 2021 in response to the COVID-19 pandemic1. In 2022 the government introduced a four-year regulatory framework with binding targets for suppliers1.
| Measure | Figure |
|---|---|
| Smart meters as share of all meters, end March 2023 | 57% (32.4 million of 57.1 million)2 |
| Homes where DESNZ expects smart meters can now technically function | 96.5%1 |
| Homes expected to be covered by the new technical solution | More than 99%1 |
| Installed smart meters not operating in smart mode, end March 2023 | 9%, around three million2 |
| Indicative annual saving for a typical dual fuel household with a smart meter, March 2023 | £561 |
The two accounts of the 2025 coverage goal differ. The NAO reports a government proposal for suppliers to install smart meters in at least 80% of the homes they supply and 73% of small businesses by the end of 20251. A separate guide published in August 2024 states goals of at least 74.5% of homes and nearly 69% of small businesses by the end of 20253. The NAO also records that 9% of installed smart meters, around three million, were not operating in smart mode as at the end of March 2023 and are effectively indistinguishable from traditional meters2.
Why it matters for households
For a household in a high-rise flat or a building where the meter sits far from the network signal, the practical barrier has been technical rather than a matter of choice. A working smart meter sends half-hourly consumption and price data to the supplier and feeds an in-home display, which is what allows a household to see what it is using as it uses it1. Where a meter cannot connect, the household keeps a meter that behaves like a traditional one, and the estimated bills and manual readings that go with it2.
The NAO's figures put a value on the difference. It cites an indicative annual saving of £56 for a typical dual fuel household with a smart meter as at March 2023, based on DESNZ's estimated reductions in gas and electricity consumption and assuming the Energy Price Guarantee was in place1. Across the rollout, government's 2019 estimate put benefits at £19.5 billion against costs of £13.5 billion over 2013 to 2034, a net benefit of £6 billion, driven mainly by supplier cost savings and reduced energy use, and therefore bills, for consumers, all in 2011 prices1.
Coverage also bears on what a household can sign up to. Flexibility services and time-of-use tariffs 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 market2. Households without a functioning smart meter have not been able to take part in some of these arrangements, and the guide notes that refusing a smart meter may mean certain tariffs, such as time-of-use tariffs, cannot be purchased3. Smart meters are not compulsory, and a household can refuse one3.
For flats and rented homes, the practical questions are who holds the energy account and whether the landlord's permission is needed to change anything at the property; the guide states that a tenant must be the account holder for the energy bills to request a smart meter, and that asking the landlord first is recommended3. More on these cases sits in smart meters and monitoring in flats and rented homes.
What happens next
The Alt HAN rollout is due from July 2023, subject to the outcome of the pilot1. Smart DCC's licence is due to expire in 20251. Ofgem told suppliers in April 2023 that they should have the capacity and flexibility of resource to meet their smart meter installation targets2. The closure of the 2G and 3G networks by 2033 is also noted in the report1.
Sources3 cited
- Update on the rollout of smart meters, nao.org.uk
- Update on the rollout of smart meters, nao.org.uk
- A Complete Guide to Smart Meters | UW, uw.co.uk