How Do Smart Electric Meters for Utility Companies Work?

You may have heard a lot about smart meters—and the imminent possibility that you will be getting one—but still have a lot of pretty important unanswered questions, such as:

  • How do they work?
  • What’s the difference between a smart meter and a conventional one?
  • Do I have to have one?
  • Will my energy costs go down?

It’s important to be knowledgeable about all things smart meter, so that when your energy provider comes knocking, you can make an informed decision about whether or not to switch.

What are smart meters?

Smart meters are electronic devices that automatically take meter readings for you and send this information directly to your energy provider. This makes your energy bill more accurate when it comes to how much gas and electric you’re actually using. You can see your energy consumption at all times, as well as how much it’s costing you, with an in-home display screen.

They are being rolled out across the country as part of a government scheme to bring down energy use and create a more flexible billing system for utility providers. It’s being led by energy suppliers big and small, with a target of them becoming standard by 2020. However, there is no legal obligation for the customer, so you can always refuse a smart meter when offered one.

What’s the difference?

Smart meters will completely overhaul how consumers are billed for their utility bills. Currently, many people are charged based on their estimated usage, which is calculated using either past use in the house or a standard rate.

This means that many people are paying too much or too little for their utilities. Smart metering will change that by providing exact readings of how much energy is being consumed, creating a simpler and more equitable system.

How could this help me?

If you use less energy than you’re currently paying for, then great news! The introduction of smart meters will save you money, as you will only be billed for what you’re consuming down to the last penny.

In other countries where smart meters have become the norm, like Italy and Sweden, they have also helped people moderate their energy usage and make savings through small adjustments, such as using an energy-efficient lightbulb. Good for the environment and good for your wallet!

Are there any drawbacks?

Like any new technology, smart meters have encountered their fair share of teething problems. Concerns have been raised about data security—as smart meters use mobile networks to transmit information—mobile reception, and cost efficiency.

The smart meter roll-out has also led to some significant increases in energy tariffs as suppliers attempt to raise funds for the scheme, costing consumers around £100 per household on average, regardless of whether they opt to have a new meter installed or not.

The decision of whether or not to switch to a smart meter as the roll-out continues rests with the individual consumer. It’s important to discuss the potential benefits and the potential drawbacks with your supplier, and with the rest of your household.

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