Does Your Business Need a Smart Meter?
Ever since standard gas and electricity meters were first installed, suppliers have had a knowledge gap with regards to the amount of energy their customers consume. This is because they usually read a meter once each billing period, which as you may be aware can spring an unwelcome surprise at bill time.
Smart meters promise to change that by sending automated meter readings to your supplier, so you don’t have to.
This eliminates the polarising issue of estimated billing (where you pay for what your supplier thinks you will use, and not what you use). With a smart meter, your supplier will know what you are using and charge you for that.
Businesses who are on estimated billing will find this quite useful. However, only small businesses should apply. If your energy needs are very high, you will probably be better off with half hourly metering (which is compulsory in some cases).
Energy companies are huffing and puffing rolling out Smart Meters. It has not been as smooth as anticipated, but millions of smart meters have already been installed across the country (particularly for residential / domestic consumers). The original roll out started in 2016. The UK government expected nearly 100% of meters to be Smart Meters by 2020 (Smart Meter Network Policy Framework Post 2020, Annex 4). This has now been extended due to industry delays.
How does a smart meter work
The first generation of smart meters (SMET 1, installed up to March 2019) used a receiver on your supply and a 3G network to connect to your supplier. The second generation of smart meters (SMET 2, installed after March 2019 > now) use a home area network or wide area network which all suppliers have access to.
It’s important to point out however there are actually two separate devices at play with a smart metering system.
The actual smart meter itself is situated in place of your old electricity and gas meter to collect data and act as the transmitter. The smart meter sends this data to your supplier and a device called a HUD (in-home display).
The piece of equipment you interact with will be the HUD (which usually takes the form of a small touchscreen device). This receives data from the smart meter and shows your current energy consumption for both electricity and gas. This is the device that helps you keep track of your energy usage in pounds, pence and kWh.
The Smart Grid
The Smart Meter initiative is part of the wider plan to build a ‘smart grid'. It sounds a bit scary, as in the SkyNet from Terminator, but the objective is to be able to manage electricity across the UK in real time. As you may have heard, during Covid-19 electricity demand declined materially. Such a drastic decline is actually a challenge for the National Grid and utility companies as the entire system may face blackouts to deal with this. Thankfully, to date this demand volatility has been well managed. Smart metering and a smart grid make such management more efficient and cost effective.
The Smart Grid is a preview of the future as it will sync with electric cars and other Internet of Things (IOT) equipment like your refrigerator or coffee machine. In effect, business energy management and figuring out the cheapest energy provider, could be done on a daily basis (perhaps, that is far into the future).
OfGem (the energy regulatory) has a wonderful guide on the future of smart meters and what they mean for domestic and non-domestic business energy customers. To be sure the biggest benefit to businesses & larger non-domestic users will be finding the cheapest business energy prices. Of course, until the smart grid is here, we believe EnergyBillKill.com has the cheapest business energy prices in the UK.
Am I obliged to have one installed?
Good question! Businesses are not obligated to have a smart meter installed by law. It’s a choice. They are also being rolled out area by area, so not everyone can get one yet.
Factors that can affect your ability to get a smart meter include being on Economy 7 (select suppliers only), if you’re on prepay (select suppliers only), and if you’re in an area with poor signal strength. Please contact your supplier for guidance.