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Smart meters explained

What is a smart meter?

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What is a smart meter?

Find out more about smart meters - from what they do and whether they will save you money, to whether smart meters give off radiation. 

Smart meters give both you and your energy provider accurate and regular updates on how much electricity and gas you use.

Like traditional gas and electricity meters, smart meters measure your energy use. The main difference is that smart meters automatically send your usage information through mobile networks to your supplier.

Your smart meter will come with an in-home display (IHD), which will show you how much energy you use in real time, and how much it's costing. So smart meters should help you to better control your energy use.

Here, we explain exactly what smart meters are, how they work, whether they're mandatory, advantages and disadvantages, and whether getting one installed will save you money.

Click a question below to jump straight to the answer, or read on to get the full picture. Find out if your energy company is installing yet in our smart meter roll-out guide.

Smart meters – what can they do? 

Smart meters replace your existing gas and electricity meters. They use wireless networks, similar to mobile phone networks, to send information directly to your energy supplier about how much gas and electricity you're using. This means you won’t have to read your gas and electricity meters any more, and your bills won’t be estimated.

Smart meters also offer additional possibilities for the future – such as improved ‘time-of-use tariffs’. These offer cheaper rates at off-peak times to smooth out national energy use through the day. Read more about the future of smart meters.

How do smart meters communicate with each other? 

When you have a smart meter installed, you'll get a smart electricity meter, a smart gas meter, and also be offered an in-home display (IHD). These elements will talk to each other wirelessly. 

Your electricity meter will be plugged in to the mains, and tell you how much energy you're using in real time. Your gas meter will be battery powered and 'asleep' for most of the time, waking up every half an hour to give a reading.

Your electricity meter is connected to a communications hub. This allows it to communicate with your IHD, using the smart meter home-area network. It also talks to the wider Data Communications Company (DCC) network, via the smart meter wide-area network, so it can send your energy data to your supplier. The gas meter also talks to the electricity meter.

You’ll get a different communications hub depending on where you live. In the south and central areas of Great Britain, hubs will use cellular and wireless mesh technology to communicate with the DCC’s central network. Further north, they’ll communicate via long-range radio.

Do smart meters work? 

According to consumer information body Smart Energy GB, three quarters (76%) of people with smart meters are likely to recommend them.

We also asked hundreds of Which? members* who have a smart meter to tell us what they think of it:

  • Three quarters of you said it met or exceeded your expectations on knowing your energy spend, use in kilowatt hours, the accuracy of your bills, and not having to submit meter readings.
  • But a fifth said your expectations weren’t met for knowing your exact spend in pounds and pence, knowing how much energy you use in kWh, or knowing your energy use over a specific period.
One fifthof smart meter owners said their expectations weren't met
So far, more than 13m smart meters have been fitted in homes. But more smart meters have been installed than are operating, government data shows. One reason is that some of them are operating in ‘dumb’ mode, so they're not functioning as smart meters. This may happen if you have a first-generation smart meter and switch suppliers – find out more in getting a smart meter installed.

Are smart meters mandatory? 

No, you do not have to accept a smart meter if you don’t want one. Government minister Greg Clark confirmed in October 2017 that ‘there is no obligation on the customer whatsoever’ to have a smart meter installed. Find out more in our guide Do I have to accept a smart meter?

Energy companies have to take ‘all reasonable steps’ to install smart meters in their customers’ homes. This is set out in the conditions of their licenses to supply gas and electricity. 

‘All reasonable steps’ isn’t clearly defined, though, and energy regulator Ofgem told us it will judge if suppliers have done so in 2020. Ofgem told us: ‘It is for suppliers to satisfy themselves that they are taking all reasonable steps into account.’ 

How much does it cost to install a smart meter? 

Having a smart meter installed doesn't cost you upfront. However, you’ll pay indirectly through your energy bills. Overall, the smart meter roll-out will cost almost £11bn, although the National Audit Office estimates that the cost will be £500m higher than this. 

The roll-out will add around £391 in total to the bills of the average dual-fuel household (£17 more than estimated in 2016).

Will a smart meter save me money? 

A smart meter will mean more accurate bills for you - and remove the costs of meter readings, which are currently added to your bills.

Smart meters are expected to cut £47 a year on average from our dual-fuel bills by 2030, according to the government. These savings will come mainly from energy suppliers receiving fewer customer enquiries and making fewer home visits, and, in principle, they should pass on these savings to customers.

Consumers are also predicted to save money by being more efficient with energy used at home. However, smart meters will only save you money if you use and act on the information provided by your in-home display to cut your consumption. 

Follow our tips to become more energy efficient - see our expert advice on cutting your energy bills.

Whether you save through efficiency also depends on how frugal you are already. Our survey of smart meter owners* found two fifths (41%) don’t think their smart meters and IHD have changed their understanding of their energy use and costs, often because they knew this information already.

In the short term, smart meters may actually cost us money.

In the short term, smart meters may actually cost us money. Scottish Power and SSE blamed their 2017 price rises partly on the cost of installing smart meters. 

Meanwhile, the organisation responsible for the wireless network, the Data and Communications Company (DCC), had more than £1.75m of its 2016/17 costs declared unacceptable by energy regulator Ofgem.

How can I get a smart meter? 

All of the Big Six energy companies, plus smaller firms including First Utility, Ovo, Utilita and Utility Warehouse, are installing smart meters in customers' homes. Most smaller suppliers we spoke to also plan to begin installing this year, in order to meet the government deadlines for when suppliers must complete their roll-outs.

Find out whether your energy company is installing smart meters yet.

Do smart meters give off radiation? 

Some people have complained about the impact of smart meters on their health, in particular those suffering from electromagnetic sensitivity or electromagnetic hypersensitivity. 

The evidence to date suggests exposure... doesn't pose a risk to health.

Smart Energy GB
The smart-meter information campaign for consumers, Smart Energy GB, told us: 'Public Health England has tested the equipment that comes closest to the specification set out for smart meters. It says that the evidence to date suggests exposure to the radio waves that the equipment produces doesn’t pose a risk to health. There will be further research on the actual equipment that will be installed when it becomes available.'

How often will my smart meter need to be replaced? 

Smart meters will need replacing around every 10 years – which is more often than current gas and electricity meters. Your energy company will let you know when your smart meter is due to be replaced, and arrange a time and date for this to happen.

Can I switch energy supplier with a smart meter? 

Long term, smart meters should make it quicker to switch energy suppliers. In theory, they can be instructed to send information about your energy use to a new energy company instantaneously.

In the short term, though, smart meters may actually be a barrier to switching. Some 70% of first-generation (SMETS1) smart meters currently lose smart functionality when consumers change energy supplier, the National Audit Office found in November 2018. 

This can happen if your chosen supplier is unable to operate your smart meter. In this case, you’d need to send meter readings again.

By the end of the roll-out in 2020, the government plans that first-generation meters already installed will be upgraded remotely so that all energy suppliers can operate them. Whether this will be possible for all types of SMETS1 meters is still to be confirmed, however.

In the meantime, some suppliers are now able to operate each others’ meters; find out more in smart meter problems and solutions.

Want to save money on energy now? Use our independent switching service to compare gas and electricity suppliers and find a cheaper deal.

How are smart meters different from energy monitors? 

Smart meters replace your current meters, and automatically transmit regular meter readings to your energy supplier. An energy monitor is a device you simply clip on to your power cable to give you a good estimate of the amount of electricity you are currently using.

A smart meter will be provided by and installed by your energy provider. You can buy an energy monitor from a shop and install it yourself. However, you should be given an in-home display when your smart meter is installed. This is a type of energy monitor which shows how much energy you’re using, in real time, and how much it’s costing.

If you want to buy a separate energy monitor, they cost from around £20 to £100. We’ve found that some are accurate and easy to use - so they will help you to reduce your energy bills. But we've also discovered some models that are fiddly to install and use. See our energy monitors explained guide to make sure you don't waste your money on the wrong model. 

Fed up with poor customer service or of paying too much for energy? Then switch. Use our independent switching service to compare gas and electricity suppliers and find a cheaper deal. 

*(Online survey: 473 Which? members, November 2017)