24 November 2017 : 
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The average dual fuel bill for households in the UK is a staggering £1,338 a year. This means that you lost around £111 a month from your income just to cover the cost of gas and electricity.

Since the recession, there’s been plenty of talk about how people can reduce their energy consumption. For example, you can install cavity wall insulation, upgrade your boiler, or even generate your own electricity.

are smart meters worth your pounds

In addition, the government has another plan up its sleeve: smart meters. These meters are designed to help cut down consumption and reduce energy bills, and help the EU’s green targets.

They’ve certainly taken off, as according to statistics from the Department of Energy and Climate Change (DECC), more than one million smart meters have now been installed in homes around the UK.

In the first quarter of this year, there were over 211,000 installed, and increase of more than 100% compared to the first quarter of 2014. However, at a cost of at least £200 per home, are smart meters worth your money?

What are smart meters?

Smart meters are the next generation of meters used to measure the amount of gas and electricity you consume within your household. They will replace your existing meter, which is now known as a ‘dumb’ meter.

The difference between smart meters and dumb meters is that they automatically send meter readings to your energy supplier for more accurate bills, and come with displays for inside your home, which helps you understand how much energy you’re using at any given time.

How do they work?

As we’ve mentioned, a smart meter is able to communicate directly with your energy supplier, so you won’t need to physically take meter readings any more. But, that’s not all; it also communicates with you via an in-home display screen.

Within your home, the meter uses a wireless network system to communicate, in the same way as TVs and mobile phones. As it’s based on radio waves, you don’t have to have Wi-Fi for it to work.

Outside of your home, the smart meter will uses another system to communicate with the suppliers. The network will be overseen by Ofgem to ensure that data is kept secure. As your energy supplier can access the data held by your meter, you can choose how much information they’re able to see.

The display is the main bit of the meter that you’ll use. This shows your energy consumption, and what it’s actually costing you. It also has a number of features, such as energy being used in real time; energy used in the last hour, week, and month; and whether it’s considered high, medium, or low usage.

When will I get one?

Most of the big six energy suppliers have already starting installing smart meters, but the supplier-led rollout isn’t officially due to start until this autumn.

When you personally get a smart meter will depend on where you live, as the rollout is happening in stages over the next five years. You can contact your supplier to find out when they are planning to start installations in your area.

Will it save me money?

You might save money as a result of having a smart meter installed, but the device itself doesn’t reduce your energy bills. However, knowing exactly how much gas and electricity you’re using, will make you more aware of your consumption and give you valuable insight into how you can lower your bill.

Smart meters are being installed for free under the national upgrade programme, but the true cost is thought to be at least £200 per household. This cost, along with the required maintenance, has been built into your energy bill, just as with a dumb meter.

While you’re under no obligation to have a smart meter, you’ll be contributing to the cost of programme, whether you have one or not, so you might as well take advantage of the potential savings.

Pros and cons of smart meters

The main benefits to smart meters are more accurate bills and the ability to better manage your energy use. The automatic meter readings are more convenient as you’ll never have to remember to submit a reading, but it will also mean an end to estimated bills, preventing you from overpaying.

As with anything, there are some negatives. The biggest issue is the cost, which has been estimated at a total of £1.8 billion. This will be paid for by consumers via their gas and electricity bills. However, there have also been concerns of the privacy of data.

Jemma Porter - Image Jemma Porter - Signature
Jemma Porter is a news & research reporter for compareandsave.com. Having worked as a journalist on a number of personal finance websites; she now spends time researching and commenting on UK personal finance stories and investigating new ways to help our readers save money. For press inquiries, please visit our Media Centre.

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