Energy suppliers, regulators and consumer rights groups have unanimously welcomed UK government plans to install smart meters in every home in Britain by 2020, in a move that will finally put an end to the estimated billing system that sees millions overcharged for gas and electricity every year.
Ed Miliband, secretary for Energy and Climate Change, made the announcement, and a consultation on how to proceed with installing and running the new meters across the country will now run until July 24.
The introduction of smart meters was hailed by Scottish Gas as the "biggest revolution in energy use since the 1970s". They will allow suppliers to automatically record customers' actual gas and electricity use, and let consumers monitor their household energy use.
Manual meter readings and the estimated bills system, heavily criticised last year by both the industry regulator, Ofgem, and the Citizens' Advice Bureau for overinflating customers' bills, will become a thing of the past.
Already, customers in pilot programmes have reported savings of up to a 10th on their gas and electricity bills because smart meters.
Garry Felgate, chief executive of the Energy Retail Association (ERA), said it would mark "the nail in the coffin of estimated bills". He added: "This is a huge undertaking, which will make a massive difference to the way everyone understands and manages their energy. Smart meters will allow you to monitor your energy use in real time and compare the amount of electricity and gas you use today against the day before, the week before, the month before and even the year before... keeping your existing meters is like sending a telegram instead of installing wireless broadband."
Alistair Buchanan, chief executive of Ofgem, said the new system would not only improve the accuracy of bills but had "great potential to encourage both domestic and business customers to reduce their energy use".
The government forecasts the scheme could lead to annual energy savings of around 2% per household, equivalent cut £100m from British bills by 2020 and reductions in CO2 emissions of some 2.6 million tonnes.
The installation programme will be bankrolled by the energy suppliers themselves at an estimated cost of £7bn, though they expect to recoup around two-thirds of that in cost savings to industry .
However, Consumer Focus Scotland wants assurance that the remaining third will not be footed by customers. Trisha McAuley, head of services and advocacy, said: "We'd like both government and energy companies to invest to keep the cost for consumers of the new meters capped at a low level or, better still, for them to be delivered free."
There also remains a question mark over how the new system will be managed. The government's preferred method is to appoint a central agency to relay data from household meters to the relevant energy suppliers, which would making switching between suppliers much quicker and easier.
Shadow energy and climate change secretary Greg Clark welcomed the plans, but described the government's timetable as "frustratingly slow" in comparison to other countries where they are already being rolled-out.
Friends of the Earth director Andy Aitkins also demanded "greater urgency" in order to put smart meters at the centre of a "green energy revolution".
Elizabeth Gore, spokeswoman for Energy Action Scotland's described smart meters as a "good thing" in the fight against fuel poverty, which affects Scotland disproportionately compared to the rest of the UK.
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