UK energy suppliers face Ofgem crack down on failed smart meter installations

Ofgem, Britain’s energy regulator, has announced new rules to boost smart meter standards and compensation, cracking down on suppliers for botched installations.

Ofgem has set out proposals to slash wait times for smart meter installations or repairs and compensation for customers facing connectivity issues in a move to improve service standards by energy suppliers.

The regulator announced plans to review its Guaranteed Standards of Performance, which includes a new set of rules that could see customers compensated if their supplier fails to offer a smart meter installation appointment more quickly or take swift action to rectify reported issues.

Specifically, Ofgem is proposing four new rules:

• Shorter wait times for smart meter installation appointments, so customers requesting a new meter are offered an appointment within six weeks.
• Compensation for a failed smart meter installation due to a fault within the supplier’s control.
• Quicker fixes if a customer reports a problem with their smart meter, requiring suppliers to provide a resolution plan within five working days of the report.
• Compensation for smart meters not operating in smart mode if not fixed within 90 days.

The rules come as millions of smart meters in the country remain in ‘dumb mode’, where the smart meter technology does not send data to the supplier, requiring the customer to provide manual readings or receive an estimated bill.

Ofgem is also consulting on new ways to ensure better protections for smart meter and business customers, which could include applying these proposed standards to business consumers eligible for a smart meter, as well as domestic customers. This would be done alongside updating its current metering rules to ensure they also cover smart meters.

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Commenting in a release was Tim Jarvis, director general for markets at Ofgem:

“Smart meters are the next generation of electricity meters. Millions of households are already taking advantage of the benefits they can offer, including unlocking cheaper and more flexible tariffs, automatic meter readings, and real-time data to help accurately keep track of spending.

“But we know that many customers are still waiting too long to get a smart meter installed or facing lengthy delays on repairs when it stops working.

“That’s why we’re stepping in to make the process quicker and easier for consumers, and to make sure they’re fairly compensated if things do go wrong.”

Energy UK’s Deputy Director, Policy (Customers), Ned Hammond said: “Smart meters play an essential part in the current – and future – energy system, helping the country make the best use of its resources by providing accurate real-time measurement of energy use and enabling customers to enjoy the benefits that can come from greater flexibility.

“So it’s right that suppliers should be held to expectation of providing a good level of service when it comes to installing and maintaining smart meters. We need to look at the proposals more closely but it will also be important that these standards work in harmony with other requirements around smart meters and take into account when problems are not in the suppliers’ control.”

Standards and dumb mode

Ofgem introduced Guaranteed Standards to ensure that energy suppliers offer an appropriate level of service and compensation payment to customers when standards are not met.

According to the regulator, suppliers are currently required to make an automatic payment of £40 to consumers if they fail to meet the minimum standards outlined in the Guaranteed Standards.

This includes making and keeping appointments, investigating and fixing/replacing credit or prepayment meter faults, and switching supplier within five working days.  

In July 2024, Utilita Energy and Cheshire College South and West launched a smart metering apprenticeship, designed specifically to overcome communications issues engineers face during a smart meter installation, namely their being left in dumb mode.

According to the partners, there are three main reasons for a new smart meter not working:

1. Commissioning issues and challenges faced by the engineer on the day, which take time and experience to overcome.
2. Smart network coverage. The Data Communications Company (DCC) is the one and only provider of the nation’s smart meter network. It is yet to provide full UK coverage. Where there is no coverage, a smart meter will not become communicative.
3. Mobile signal strength. Where there is DCC network coverage but poor mobile network, the signal strength may not be adequate for the meter to communicate.

That same month, Ofgem opened compliance engagement into six energy suppliers – British Gas, EDF, E.ON, Octopus (including their acquired Bulb Energy), OVO and Scottish Power – for not meeting their smart meter installation targets and for smart meters not operating in smart mode.

Ofgem, citing government data, says that 66% of homes in Britain now have a smart or advanced meter, and more than 90% are working correctly.

Smart meter policy and connectivity is led by the UK’s Department of Energy Security and Net Zero (DESNZ), as well as the smart meter Data Communications Company (DCC).