Smart Meters

Monday 8th July 2019 Lords Chamber

Question

14:53

Asked by

[Lord Lennie]

To ask Her Majesty’s Government what assessment they have made of the roll-out of smart meters.

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Henley) (Con)]

My Lords, the smart meter rollout in Britain is making good progress, with over 14.3 million smart and advanced meters operating, as of the end of March 2019. The programme remains on track to offer smart meters to every home and small business by the end of 2020.

[Lord Lennie (Lab)]

I thank the Minister for that Answer—just the 50 million or so short of target. Given the promised financial benefits to hard- pressed customers and the obvious global advantages of moving to a low-carbon economy associated with SMETS 2, why do the Government persist in leaving the implementation of this policy to the energy suppliers? Can the Minister state clearly why Ofgem rejected five of the major suppliers’ rollout plans for 2019 as being inadequate? Do the smart meters just not do what it says on the tin?

[Lord Henley]

My Lords, I had better write to the noble Lord with greater detail about Ofgem’s comments. It has completed the 2019 review and believes that suppliers are on track to meet our commitment that every household should have had the offer by 2020.

[Baroness Wilcox (Con)]

I should refer to my entry on the system before I admit that I have something to do with consumers. I want to congratulate the Minister on having had the courage even to get suppliers started on the rollout of smart meters. I would be interested to learn whether he has helped them in any way so far and, if so, whether he will do more.

[Lord Henley]

My noble friend brings great expertise to dealing with the interests of consumers. I can assure her that the programme regularly engages with consumer groups such as Citizens Advice. It has a dedicated consumer issues forum, which they and other consumer groups regularly attend. My honourable friend the Minister for Consumer Affairs has regular meetings with the appropriate bodies.

[Baroness Maddock (LD)]

My Lords, how many people who had first- generation smart meters came up against problems when they tried to change their supplier? It was anticipated that people would make savings when they had smart meters. Have those savings reached the Government’s anticipated level?

[Lord Henley]

My Lords, I cannot help the noble Baroness on the first figure she asked for, but if some figures are available, I shall certainly write to her. Earlier meters will be enrolled in the Data Communications Company infrastructure by the end of 2020, which I hope will help on that front. We are expecting to provide bill savings of some £1.2 billion by 2030, making the programme a very good investment for the country.

[Lord Harris of Haringey (Lab)]

My Lords, I refer to my interests in the register. The network of smart meters will obviously be part of the so-called internet of things. What assessment have the Government made of the cybersecurity of smart meters, of the extent to which they could be turned into a sort of super bot to attack all parts of our infrastructure or commerce, and of the instability in demand for electricity they could create by all of them switching on and off at the same time?

[Lord Henley]

My Lords, the noble Lord is quite right to point to dangers on that front. The Government will continue to keep the situation under review, but I can assure the noble Lord that we are not aware of any concerns.

[Lord Watts (Lab)]

My Lords, what will happen to the market if all customers switch to the cheapest provider?

[Lord Henley]

I hope that the market will be able to adapt to that and deal with it as it ought to; that is what markets are about. I know that noble Lords opposite do not like markets, but, in the main, they work rather well and provide opportunities for consumers to move to cheaper prices. That is why the number of energy suppliers has gone up dramatically, with more than 60 now operating in the country.

[The Countess of Mar (CB)]

My Lords, the Minister said that the objective was to get all domestic premises fitted with smart meters. I understand that smart meters work only if there is mobile phone reception. There are quite large number of pockets of the country where there is no such reception. What is the solution?

[Lord Henley]

My Lords, the Government’s commitment was to make sure that all premises were offered smart meters, but the noble Countess points out a problem with mobile reception—it affects me in the north-west of England—and it is certainly something that we will have to look at.

[Baroness McIntosh of Hudnall (Lab)]

My Lords, the noble Lord said in reply to the noble Baroness, Lady Maddock, that savings of £1.8 billion are expected to be generated through the use of smart meters—if I have got that figure wrong, I apologise. Will he translate that into a figure that might mean rather more to people who have smart meters—for instance, the percentage reduction in their bills that they might expect if they have a smart meter installed?

[Lord Henley]

My Lords, the figure I quoted was bill savings of some £1.2 billion, but I accept that the noble Baroness misheard me. We expect a net benefit of some £5.7 billion from the rollout as a whole. Again, I would prefer to write to the noble Baroness with estimates as to what individuals could save, but obviously, it will depend on how the individual makes use of the smart meter. The point of the smart meter is that it makes it easier for the individual to keep an eye on their electricity or gas use and therefore to make the appropriate savings we would all like, both in the use of energy, which is important, and in money for the individual.

[Lord Hamilton of Epsom (Con)]

My Lords, my noble friend has commented on the value of markets. Will he tell us about the success of capping energy prices? I gather that most customers are now paying the higher tariff and prices have gone up, rather than down.

[Lord Henley]

My Lords, I think my noble friend is wrong—capping has been a success. We announced that it was only a temporary measure because the markets were not working, but I, like my noble friend, want to make sure that the markets work because that is the best way forward.