Energy suppliers to cough up £10.8m after missing smart meter targets
Some of the UK’s biggest energy suppliers have agreed to cough up £10.8m in redress payments, after missing their smart meter installation targets for 2022.
The firms’ failure to meet targets resulted in a total shortfall of 1,026,628 smart meters by the required deadline.
This includes British Gas, Ovo Energy, Octopus-owned Bulb, Eon, Scottish Power and SSE.
British Gas will pay the most (£3.4m) followed by Ovo (£2.8m), Bulb (£1.8m), Eon (£1.7m), Scottish Power (£1.2m) and SSE (£250k).
The companies will chip in to Ofgem’s Energy Industry Voluntary Redress Fund (EIVRF), which is used primarily to help consumers in vulnerable situations most at risk from cold homes and high energy bills.
Scottish Power has additionally agreed to pay £440,000 into the EIVRF after missing its smart metering obligations in 2019.
Ofgem has opted against a full investigation into the shortfalls following the redress payments.
Cathryn Scott, Director of Enforcement and Emerging Issues for Ofgem, said: “The installation of smart meters is a vital step in the modernisation of our energy system and the path to net zero by 2050. Smart meters give customers better information about their energy usage helping them budget and control their costs.”
Smart meters help households track their energy usage and are seen as vital for making the energy system greener and more flexible.
However, smart meters remain an optional device for customers, despite mandated targets on firms.
These targets, underpinned by government, are overseen and enforced by Ofgem.
Earlier this year, the government launched a consultation on plans to have the devices installed in 80 percent of homes and 73 percent of small businesses by the end of 2025.
However, UK energy companies are only 57 percent through the government-mandated rollout of smart meters, according to a report from the National Audit Office published in June.
The public spending watchdog has calculated that savings from smart meters equated to £56 annually per household, just under £5 per month.
Suppliers including Utility Warehouse and EDF have called for the meters to be made mandatory for homeowners to ensure rollout.
City PM has approached the related energy suppliers for comment.