Government’s Smart Meter Deadline Will Be Missed, Warns NAO

The National Audit Office (NAO) has reported on the state of the rollout of the Government’s troubled smart meter program.

And it is not good news, with the NAO saying that the Government’s 2020 deadline will be impossible to reach, and it “needs to reconsider the deadline”.

This is not exactly surprising. As far back as 2015, MPs were warning that the rollout of smart meters to UK homes and businesses was in danger of becoming a “costly failure”.

Troubled rollout

The £11bn government programme aims to put 53 million smart meters into all of the UK’s 30 million homes and businesses by 2020. This is a typical cost of £374 per dual fuel household in the nation.

The programme could result in estimated energy savings of £17bn, against a likely rollout cost of £11bn.

The devices, which indicate energy usage in real time, are expected to generate these savings by allowing users to modify their power usage.

But the NAO report has suggested the deadline will be missed, and pointed out that nearly one million first generation smart meters are no longer working properly (as 70 percent of first generation units cannot adapt when the consumer switches energy supplier).

“The Department (of Energy) acknowledges that, notwithstanding the industry and other bodies involved, it is responsible for the overall success of Smart Meters,” said the NAO. “While recognising the team’s achievements so far, we urge them to make sure the team culture does not become defensive, and resistant to inconvenient truths.”

“The facts are that the programme is late, the costs are escalating, and in 2017 the cost of installing smart meters was 50 percent higher than the Department assumed,” it warned. “7.1 million extra SMETS1 meters have been rolled out because the Department wanted to speed up the programme. The Department knows that a large proportion of SMETS1 meters currently lose smart functionality after a switch in electricity supplier and there is real doubt about whether SMETS1 will ever provide the same functionality as SMETS2. The full functionality of the system is also dependent on the development of technology that is not yet developed.”

Unrealistic installation?

“The facts summarised above, and many more, are not fatal to the viability and value for money of the programme,” the NAO noted. “However, there are serious issues that need to be addressed if Smart Meters is to progress successfully and deliver value for money.”

So far 12 million meters have been replaced over the last six years. But to meet the 2020 deadline, installers will need to replace 39 million old meters within the next two years.

The government said that 400,000 meters were being installed every month, and the target was achievable.

“Millions have already chosen to have a smart meter and take control of their energy use to cut their bills,” energy minister Claire Perry told the BBC. “We’ve said everyone will be offered a smart meter by the end of 2020 to reap these benefits and we will meet that commitment.”

In 2016 the Institute of Directors slammed the “flawed” Government smart meter scheme and said it ‘needs to be halted’.

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