Ofgem and Utilita Energy clash over smart meter rollout warning

What’s happened?

Utilita has landed in hot water with the energy regulator for failing to comply with rules stating that all energy suppliers must take all reasonable steps to install second-generation smart meters.

Instead of installing SMETS2 meters, Utilita has continued to install the unreliable SMETS1 meters, a move that goes against the New and Replacement Obligation (NRO) and can cause issues for the Data Communications Company (DCC) which is in charge of the national infrastructure that connects smart meters, energy suppliers and companies.

SMETS1 meters are notorious for losing their smart functionality when a customer switches to a new energy supplier and can result in confusion and inaccurate bills as well as creating headaches for both energy suppliers and Ofgem.

“Utilita has continued to install SMETS1 meters at volume despite the introduction of the ‘New and Replacement Obligation’ (NRO), where suppliers must take all reasonable steps to install a SMETS2 meter at any new or replacement installation of a meter, from 30 June 2019.

'By continuing to install SMETS1 meters in large numbers, Utilita is also increasing the number of SMETS1 meters that will need to be enrolled in the Data Communications Company (DCC). The DCC is responsible for the national infrastructure that enables communications between smart meters, energy suppliers and network companies,” said Ofgem in a press release.

Also read: Half of energy suppliers have failed to hit Smart Meter installation targets

Utilita hits back

Utilita has spoken out against the Ofgem announcement, claiming that it was unfair and didn’t consider the efforts the company has made when it comes to smart meters.

“To say we have been “failing to act on smart meters” is grossly unfair – we have led the way, installing the first smart meter in Britain in 2005, many years before the national rollout began. Let’s be clear: our decision to continue to install first-generation meters is a moral one made solely with the best interests of our customers at heart.

‘Forcing PAYG (Pay As You Go) customers – tens of thousands of whom are vulnerable – to use unproven SMETS2 meters, which have major connectivity issues across large swathes of the north of England, and are clearly not user friendly, is unjustified.

‘For pay-as-you-go customers, SMETS 1 meters are proven, secure, robust and reliable, and provide excellent functionality. Serving pay-as-you-go energy households effectively is our main objective, and SMETS 2 meters do not enable us to do this in the same way that SMETS 1 meters do," said Utilita on its website.

Also read: Debunking the most common myths about Smart Meters

What happens next?

According to the Ofgem press release, Utilita now has until 30 April to install 250 SMETS2 meters and have until 31 July 2021 to install another 15,000.

If the company fails to hit those targets, then the energy regulator will ban it from taking on any new customers.

“Upgrading Great Britain’s energy infrastructure, enabling customers to be better informed and engaged in managing their energy consumption by providing them with real-time information on their energy use. Smart meters also help enable the transition to a more flexible energy market and the move to a low carbon economy.

‘Ensuring all energy suppliers take all reasonable steps to install SMETS2 meters for new and replacement meters is critical to the success of the smart meter rollout as it enables smart meters to operate reliably for all consumers regardless of their energy supplier,” said Charles Hargreaves, Ofgem’s deputy director of conduct and enforcement.

Utilita will now have until 30 April to install 250 SMETS2 meters, and then have until 31 July 2021 to install 15,000 in line with the plan they have presented to Ofgem. If the company fails to meet these targets, it will be banned from taking on new customers or upgrading current customers until it meets the installation targets.

Further Reading

Ofgem to modify electricity and gas licenses in an attempt to improve standards among energy suppliers

How should Energy Suppliers explain Energy Bill Increases?

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