Warning over cost of move to smart meters

THE INCREASING cost of the smart meter rollout to households could become “potentially even greater” amid a “real information gap”, a consumer group has warned MPs.

Citizens Advice head of future energy services Dhara Vyas told the Business, Energy and Industrial Strategy Committee that there needed to be a “real focus” on an updated cost benefit analysis of the programme.

Late last year, the National Audit Office (NAO) said the Department for Business, Energy and Industrial Strategy’s (BEIS) latest 2016 estimate that the programme will cost £11bn – the equivalent of £374 per dual fuel household – “under-estimates the true cost of rolling out smart meters”, which had since increased by at least half a billion pounds or the equivalent of an extra £17 per household. Ms Vyas said the extra £17 figure could become “potentially even greater”, adding: “We have been asking the department for an updated cost benefit analysis. “There is a real information gap here and it really impacts upon our ability to do our job as watchdog.”

She added: “I think there should be a real focus on doing a new cost benefit analysis.”

In November, the NAO warned that the Government’s target of installing smart meters in every home by 2020 will not be met and the cost of the rollout may “escalate”. Energy Minister Claire Perry confirmed that an updated cost benefit analysis was planned for the middle of this year, adding that the 25 per cent of households that now have a smart meter would allow for a “much better analysis” of the benefits.

Asked by MP Caroline Flint why data from the 11m installed meters had not been analysed to provide answers as to “whether or not smart meters are making any real difference against a backdrop of increasing low levels of energy usage amongst the public”, Ms Perry answered: “I think that’s a really important point and I think that’s exactly what we want this year’s analysis to look at.”