Smart meters: How do they work and will they save you on electricity costs?

Smart meters are a hot topic these days. While ESB Networks has been rolling out the meter-replacement project throughout the country in recent months, the public debate over whether the meters are a help or a hindrance to consumers looking to reduce their electricity costs has been raging. Add in spiraling electricity costs, and you can see why people are examining the new technology to see if it actually benefits them in the ways they might have expected.

ESB Networks is installing 500,000 smart meters per year as part of a long-term programme, with the goal of replacing every electricity meter in the country with a next-generation smart meter.

What is a smart meter?

Smart meters use digital technology to record your electricity usage, replacing your analogue meter. On a wider scale, the meters are designed to enable the development of smart grids, support local and micro-generation schemes and support the electrification of heat and transport.

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ESB Networks collects data from the meters once a day, which it sends to your energy supplier. This should mean that your bill will be as up to date as possible – a handy feature when electricity rates are rising.

Once the meter is installed, it takes up to 30 days for it to be connected to ESB communications network; after that, suppliers can read the meters remotely.

When will I get my smart meter?

ESB Networks began installing the smart meters in autumn 2019, with more than 900,000 already put in. The company is carrying out the installations of smart meters on an area by area basis, with customers being given advance notice when the installation will happen.

Why are they being installed?

This is part of a programme laid out by the Commission for Regulation of Utilities, under Ireland’s Climate Action Plan.

The advantages of the smart meters are supposed to be fairly straightforward. Not only will the meters ensure you have more accurate bills by automatically recording your use and sending it on to your supplier, meaning your estimated bills should end, it will also give more accurate time of use data. That, in theory, should allow utility companies to offer more competitive rates for off-peak usages, and impose higher charges at the times when power is most in demand, encouraging people to change their usage patterns and save energy.

According to ESB figures, more than 3.5 million remote readings have been processed by the meters to date, so that element of the smart meters is functioning as expected. And from November a new ESBN customer portal will allow customers to see their electricity consumption history.

Smart meters will also provide network data to ESB Networks to help resolve issues on the grid network more quickly.

Will it save me money?

Whether the meters will result in cheaper bills for consumers is something that has been hotly debated in recent weeks. Electricity companies have been offering “smart” services since February 2021, such as time of use tariffs and more than 110,000 customers have availed of smart services or tariffs. The aim is to eventually shift all customers to a time-of-use tariff over time, although for now the utility companies are still offering 24-hour flat-rate products. And while smart meters may change how people use electricity and cut their overall usage, a recent examination of the existing “smart” plans on the market indicated that they may cost people more money in the long run.

Can I refuse a smart meter?

Not everyone is a fan of the new meters. ESB says about 2 per cent of customers to date have asked not to have the smart meter installed, for various reasons.

But those days are numbered, with ESB saying it has a “statutory and regulatory requirement” to replace all electricity meters with a smart meter.

“Any customer who does not wish to receive a meter upgrade at this time can contact ESB Networks or their electricity supplier to register their preference. ESB Networks will then engage with the customer to understand their issues and to provide reassurance,” a spokesman for ESB said in a statement.

“If a customer still does not want a meter upgrade at that time ESB Networks will not proceed with the replacement but will re-engage with these customers later as the programme continues and the benefits of the new services are better understood. In due course all electricity meters will have to be upgraded.”

There are other reasons why you may need to upgrade your meter. If you have solar photovoltaic panels, for example, and are offered a smart meter, ESB Networks says you need one to access the feed-in tariff payments for surplus electricity returned to the grid. Deemed payments only apply to other meter types such as day/night or three-phase meters.

For some people that won’t be an issue, as they have systems with battery storage and are returning very little to the grid, or they have older mechanical meters that roll backwards as power is sent to the grid, ensuring that they get a like-for-like swap.

However, with ESB set to replace every meter in the country by 2024, it seems the days of meters are numbered.

The pros – and cons – of a smart meter

Pros

• With a smart meter, there is no more submitting meter readings to your electricity supplier – you can get accurate and up to date detailed bills so you can understand how and when you use your electricity.
• This might impact your behaviour and lead you to change your habits, which may lead to lower bills in the future.
• Smart meters can help you switch by showing how and when you use your electricity. This should help you pick a new supplier that offers the best price for your energy needs.

Cons

• Smart meters are not free: while there is no upfront cost, €5.50 a year will be added to electricity bills for the next 20 years.
• You can say no to a smart meter, but there is a legal requirement to replace them, so you may have to move at some point. And once the smart meter is installed, there’s no going back to the old way.
• While smart meters are expected to save you money, this may not turn out to be the case. The energy regulator, the Commission for the Regulation of Utilities, is currently looking into why some smart meter time-of-use tariffs are working out to be more expensive than conventional energy rates.