UK smart meter suppliers under fire as replacements lag Smart energy meter showing live gas and electricity usage data.

As suppliers fail to meet smart meter rollout targets and research shows lagging rollout statistics, Ofgem chief executive Jonathan Brearley has issued a warning to UK suppliers to comply with new prepayment meter rules, stating that their “reputation is on the line”.

Brearley’s warning came via an interview with BBC earlier this week, where he stated “deep concern” with controversial prepayment installation practices by UK suppliers over the last few months.

Earlier this year, suppliers were reported to have conducted prepayment meter replacements for vulnerable customers without their knowledge.

According to energy regulator Ofgem in a press release a day prior to the interview, all British domestic energy suppliers have signed up to their updated Code of Practice and tougher Ofgem oversight of prepayment meter installation.

Ofgem also started an investigation into such prepayment ‘poor practice’ and has updated the Code on existing protections by “setting out more specific high-risk categories, where involuntary installations should be banned.”

They go on to clarify that such installations are “always the last resort when all other options have been exhausted”.

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Specifically, the updated Code bans involuntary installations for highest risk customers including:

• Households that require continuous supply for health reasons, including dependence on powered medical equipment
• People over 85 years of age (if there is no other support in the house)
• Households with residents with severe health issues including terminal illnesses or those with a medical dependency on a warm home (for example due to illness such as emphysema, chronic bronchitis, or sickle cell disease)
• Where there is no one within the household that has the ability to top up the meter due to physical or mental incapacity

A day before release of the updated Code, the regulator released an open letter – an annual occurrence – on smart meter rollout in the county.

In it, they point to the fact that suppliers have been failing to meet smart meter rollout targets.

Specifically, under the current rollout framework, which was established at the start of 2022, market suppliers are “subject to binding annual installation targets” and of the 49 suppliers – with gas, electricity or both licenses – under this framework, 31 (63%) failed to achieve electricity targets and 23 (47%) failed to achieve gas targets.

Failure to achieve their targets is a breach of the supplier’s license, and will result in penalties from Ofgem.

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Supplier changes and lagging rollout

Ofgem’s denouncement closely preceded a data release from Electralink pointing to how energy supplier switching in the country has reached an all-time high since the 2021 mass supplier exits.

There have been 443,000 voluntary Change of Suppliers (CoS) this year, with 176,000 in March 2023, 64% up from March 2022 and the highest since November 2021, when dozens of suppliers went out of business.

Also this week, Electralink released research showing how smart meters have increased 17% month-on-month at 212,000 installations last month, although this is 5% down from March 2022.

This figure is still not near the level of installations needed to reach the UK’s rollout targets as, according to analysis from Cornwall Insight, although the UK has passed the halfway target for smart meter installations, reaching their 100% goal by the end of 2025 is unlikely.