A group of MPs has warned that the benefits of installing smart power meters in every home in Britain may not reach vulnerable people and could be kept by energy companies.The Commons public accounts committee said today that it feared people on low incomes and those using prepay meters may not fully understand energy tariffs. Smart meters allows residents to see exactly how much energy they have used.
Under European Directives, all member states are required to install smart meters to at least 80 per cent of domestic electricity consumers by 2020.
The UK Government has instead opted for £11.7 billion plans which include energy suppliers installing smart electricity and gas meters in all homes in Great Britain by 2019.However, MPs have called on ministers to take a greater role in overseeing the roll-out to ensure benefits are available to as many people as possible and for them to set out how they intend to do this.
Margaret Hodge, chair of the public accounts committee, said: ‘Already at a significant disadvantage when energy costs rise, the vulnerable, elderly and those on low incomes are at risk of not benefiting from smart metering.‘Introducing smart meters in this way by expecting consumers to pay for the installation is of itself regressive.‘Some consumers are not knowledgeable about energy suppliers and tariffs, which are difficult to understand, some do not have a bank account, so will miss out on savings from using direct debits, and some choose prepayment meters to allay the fear of disconnection.’
The committee called for safeguards to be put in place to stop vulnerable customers being cut off if they fall behind with payments.
Energy companies were also put under the spotlight in the report, with the committee calling on the government to ensure the scheme was transparent and that competition was strong enough to drive down prices.
Ms Hodge said: ‘The costs of installing smart meters will not be transparent in consumers’ bills.
‘Energy suppliers will benefit significantly from smart metering, for example, through cost savings on staff associated with automated meter reading.‘We are sceptical that suppliers will pass on these benefits in full to consumers, given their track record and the failures of suppliers to reduce retail prices promptly when wholesale energy costs have fallen.’
The government is due to report back to the committee in 2013.