The initial cost of the smart-meter project was quoted as £11 billion, but research commissioned for consumer group The Big Deal found the price had already risen by more than £1 billion because the Department for Business, Energy and Industrial Strategy had underestimated the cost of installation.
What the changes needed to fix SMETS1 will add to the bill remains to be seen, but ultimately the cost will be borne by bill payers.
“The consumer carries the whole cost of the rollout because, although it’s a government mandate, they’ve arranged that it goes onto your energy bills – it doesn’t go on the Treasury book,” said WiFore CTO Nick Hunn. “The government has given free rein for providers to pass the cost on to consumers.”
That’s one reason why gas and electricity suppliers reacted angrily when the government proposed caps on household prices following recent price increases. British Gas, for example, added 12.5% to its charges in August 2017 – despite the falling wholesale costs of power – but claimed that installation of smart meters added £33.60 to the average household annual bill.