Broken connections: Has confidence in smart energy meters taken a dent?

Mary, who lives in rural Banffshire, an area renowned for its dramatic coastal scenery, extensive farmland, hills and glens that lead to the Cairngorms, has been under pressure from her energy company to install a smart energy meter.  

But she is not keen on the installation and is worried about the poor connectivity in the area, which is below the national Scottish average for network speed, and is known to have a patchy mobile phone signal in certain parts. She is concerned that if the device doesn’t work properly, it could interfere with her solar panel system, causing inaccurate measurement of exported electricity, which could lead to potential billing errors.  

Mary thinks the energy-saving measure is simply not fit for purpose for people like her who live in rural areas in Scotland and has decided that if it must be installed, then she would like the smart functionality disabled. 

She is right to be concerned, and she is not alone. Pauline, who lives in East Lothian – an area with better network coverage than the part of Aberdeenshire that Mary lives in – has been having issues with her smart energy meter over the last 12 months. It had not been sending accurate readings since the end of 2024, resulting in her bills being estimated by her supplier. To compound the problem, the meter was installed in a hard-to-reach area in her home, making it impossible for Pauline to take manual readings.  

As the problem persisted for months, Pauline’s energy account fell into debt by over £400. She disputed this and contacted Citizens Advice Scotland (CAS), which referred her to its Emergency Help Unit (EHU) and carried out an investigation.

During this time, an engineer found that the signal between the electric and gas meters in the home was intermittent and was operating in ‘dumb mode’ – an industry term for smart energy meters that have lost connection and function like traditional meters, unable to communicate data automatically. After new meters were installed the connection was stronger, and both smart meters were able to communicate properly.  

The estimates made by her supplier were found to be drastically wrong, and once the meters were fixed Pauline’s account was found to be £258 in credit over the period her account had been in debit. 

This is not an isolated issue; CAS has told Holyrood that problems like this are being seen across the country, and there are millions of energy customers who have smart meters that are currently operating in ‘dumb mode’.  

According to the UK Government’s Department for Energy Security and Net Zero (DESNZ), as of March, there are around 36 million smart energy meters installed in homes and businesses across the UK, with around 3.5 million experiencing signalling issues. And according to a survey by Smart Energy GB in 2022, 37 per cent of Scottish households with the technology have reported issues, including no automatic readings, inaccurate bills, and the display not showing information.

Compounding that, research by Savanta for Citizens Advice found that where customers report smart meter issues, they often say their concerns are not addressed promptly by suppliers.  

Norman Smith, a stakeholder liaison officer at the EHU, which is run by CAS, says that in recent years he has seen “a dent in consumer confidence” in energy smart meters.  

“We’ve all seen the adverts that smart meters are being suggested to be a way for consumers to manage their energy consumption, save energy, money, and provide accurate billing.  

“And it has been disappointing for many customers who have had them installed, and they haven’t worked as they are intended to.” 

He explains the main source of the so-called ‘dumb mode’ has been due to signalling problems, which have been acknowledged to be far worse in Scotland and some parts of the north of England, as opposed to the rest of England and Wales, by Energy UK – the trade association for the energy industry.  

The north-south divide stems back to when the UK Government set up the framework for the national smart meter rollout in 2011, which was originally targeted to be completed by 2019. The system was designed to send information about households’ energy usage to the Data Communications Company (DCC), which is a central organisation established in 2013 to coordinate the rollout and transfer data securely between smart meters and energy suppliers.  

However, while this was a national rollout, the decision was made by the UK Government to take two approaches to connecting smart energy meters based on geography. In the south of England and Wales, the meters used cellular networks, the same used by mobile phones, to connect to the DCC. This is typically faster and performs better in urban, more densely populated areas. However, it was deemed that parts of northern England and Scotland were not well enough connected and that long-range radio networks – which are built and operated by telecommunications company Arqiva – would be utilised to connect meters to the DCC. The logic behind the decision was that rural parts of Scotland and northern England lacked reliable mobile coverage, and radio, despite being much slower, would be a more suitable solution for these communities.  

However, more than a decade on, the reality is that coverage in many parts of Scotland, particularly rural areas which the decision was made with in mind, is poor. But it is not just the areas in Scotland with the patchiest coverage that are experiencing issues with smart energy meters not connecting to the DCC; there have been reports of customers in cities like Edinburgh and Glasgow unable to achieve a working signal.  

A customer in Glasgow was told by his energy supplier that his smart meter did not work because he was “too far up north”.  Hartesh Battu, a doctor from Scotland’s most populous city, told the BBC’s Panorama in November last year he had six different smart meters fitted by two energy suppliers.  

He was unimpressed by the reasoning given by his energy supplier, Octopus Energy. He said: “I just thought that was a bit bonkers because I live in Glasgow, I’m hardly up in Shetland, I’m not rural at all.” 

Responding to this case, Octopus Energy confirmed the meter was fixed in September and the data from Battu’s electric vehicle’s charging was used to backdate the tariff, “providing the savings he would have received had the meter been working from the start”. 

The spokesperson said: “We are required by regulation to install this 20-year-old technology, leaving us with very limited control over the hardware. 

“We are limited by the technology provided to us and highly inflexible regulations. If we were allowed to use modern technology like our proprietary Octopus Home Mini for meter readings, we would have been able to solve Mr Battu’s issue instantly, but regulation has not moved with technology.” 

In November, for the first time, Energy UK acknowledged the regional divide caused by using radio networks. The body’s chief executive Dhara Vyas said: “There are issues in the north, we do know that... All the [energy] suppliers have been sharing their experiences so that there is a really good picture of what is and isn’t happening and where things are going wrong.” 

She added: “There are sometimes issues with the network signal [in the north], in terms of how it transmits and pings information back and forth, and they just aren’t strong enough in certain areas.”  

Since then, there has been a change in approach by the DCC and DESNZ. Last month, it announced 4G-enabled connectivity would be made available in the north of England and Scotland. The decision followed the planned deactivation of the Radio Teleswitch Service (RTS) on 30 June. The RTS is an older technology, introduced in the 1980s, that used radio signals to automatically switch electricity meters between peak and off-peak rates. Predominantly these outdated meters are concentrated in rural and island areas of Scotland, where households are more likely to rely on electricity for heating and hot water as many are not connected to the mains gas grid.  

However, as over 100,000 devices in Scotland alone were thought to still be active in June, the UK Government stepped in on 19 June to announce a gradual phasing out rather than a sudden switch off.  

Smith says this approach was taken at the 11th hour because “smart meters couldn’t be rolled out quickly and effectively enough” with the connectivity regulations in place at the time. 

“There were key rural areas where the signal was a problem. Ultimately, now with access to the cellular network it should, in theory, balance out the divide that’s been seen between the north and south.  

“We’re very hopeful that if smart meters are rolled out with 4G, it should reduce the number of areas that have been experiencing signal issues.” 

He adds: “This is a very recent thing, and hopefully it will provide more stability to the network as a whole and reach those homes that previously have been told they are not smart-ready. It’s early days, and it’s difficult for us to gauge, and it’s too early to say for certain how this will improve the situation.”

It seems that there is now optimism in the sector that, for homes and businesses, particularly in rural and island areas with typically less access to network connectivity, the level of faulty smart energy meters will be greatly reduced. However, the concerns over consumer confidence are still a pertinent issue after years of the connectivity divide.  

While there are no statistics for how many smart energy meters are operating in ‘dumb mode’ in Scotland, the 3.5 million that do not have a signal across the UK suggest there will be hundreds of thousands of Scottish properties affected. And with the “dent in consumer confidence” that Smith describes, he says “the challenge will be to convince the individuals who have had failed installations and problems since that there are new solutions. 

“I think the industry needs to recognise that people who have been affected need some convincing, and they have to ensure that the benefits of smart energy meters are clearly conveyed.” 

Frazer Scott, the chief executive of Energy Action Scotland (EAS), a charity dedicated to ending fuel poverty, is critical of the government’s approach to the rollout, pointing out that it has missed its target of having a smart meter in every home by the end of 2019, while the cost to the public purse nears almost £20bn.

The completion target was revised a further two times, first to the end of 2020 and then by 2024. The current target is 74.5 per cent of homes must be connected by the end of this year, and the UK Government is consulting on making it an obligation to have 100 per cent completed by the end of the decade. 

Even with the change in regulation, “that’s clearly not going to happen,” Scott says. He also points out that while there is a large amount of old technology that needs to still be replaced from the 1980s relating to the RTS, there are also millions of first-generation smart meters, known as Smets1 meters, that were installed near the beginning of the rollout that should no longer be in operation. According to the UK Government, by the end of 2024 there were still 14 million in use.  

“They were all meant to be upgraded or replaced a year ago,” Scott tells Holyrood.“That didn’t happen. I’m a customer who had one and mine was only replaced in May, and that was because I asked for it. Many of these, including my own, are no longer smart in any way, not sending signals to the DCC, and the display offered no useful information.” 

It’s clear there is a long way to go to achieve the current industry-standard technology in all households, and as the rollout continues at a slower pace than projected, fuel poverty in Scotland is in an abject place. According to the Scottish House Condition Survey 2023, 34 per cent of households are in fuel poverty, and almost 20 per cent of households are in extreme fuel poverty – meaning 20 per cent or more of their income goes towards adequately heating the home.  

Scott is critical of the lack of extra support in the rollout of smart energy meters for those living in fuel poverty. He says homes that have prepayment meters have had “no priority for smart meter upgrades”. 

“This is despite there being disproportionately more benefits to these people if they have a smart energy meter. If you have one, it eliminates the need to go and travel somewhere to buy a top-up, it makes remote top-ups quick at home and gives you information from your prepayment meter that tells you how close you are to running out of money.  

“Another example of how these people would have benefited from early access to the smart meters is if you are due any financial payments for energy, and you are on a prepay meter, the government needs to find you and send you that money. If you have a smart pre-payment meter, it is remotely added to your account. 

“So, the divide we’ve seen and the delay to the rollout mean that there have been people who have missed out on benefits. We’re already six years late, six years of people not getting the benefits for having access to a smart energy meter.” 

The Scottish Government has set a target to eliminate fuel poverty by 2040. Scott says there’s “no chance” it will be met on time and smart technology “is an important part” of the support system that needs to exist “for the most vulnerable people” in fuel poverty. “When you’re excluded by technology, it’s not right and it’s not fair, and I look at a lot of this and it just hasn’t worked, it hasn’t created confidence, and in some respects it has eroded relationships between the consumer and the supplier,” Scott says.  

And the slow and ineffective rollout to Scottish homes could cause a much larger problem for the Scottish Government’s net zero plans, as both its updated Climate Change Plan from 2020 and the draft Energy Strategy & Just Transition Plan both stress that the aim to make Scotland carbon neutral by 2045 rests not only on large-scale renewables, but on households shifting how they use energy. “Smart energy meters are a big part of how people will change their energy consumption habits,” Scott says. 

Scottish ministers have set the goal of phasing out gas boilers by 2035 in favour of 600,000 new low-carbon heat pumps, while also pushing increased electric car use and ensuring more renewable energy is used locally. The government has stressed that this will depend on “demand-side management” – encouraging people to use power at different times of the day in order to allow the National Grid to manage peak and off-peak times of the day better. 

Scott says the net zero plans “rely on us all having smart meters”. “Unless you [as a country] understand in real time your energy consumption, meaning having recordings every 15 minutes, it’s really difficult to see how in the future you will be able to shift loads or deal with peaks and troughs in supply.” 

He adds: “If the smart meter rollout is indicative of how we’re going to tackle the big challenge, which is achieving net zero, then heaven help us. 

“If we are six years behind on metering, with no real end in sight, then how can we have confidence that we can come anywhere close to our net zero ambitions?” 

Many households have already grown distrustful of smart energy meters because of the early regulatory flaws that have caused connectivity issues, along with the general speed of the rollout. Customers like Mary, who are doing everything they can to avoid having a smart energy meter, are a testament to that distrust, and that must be deeply concerning for the country’s future ambitions for net zero, according to the plans set in place by the Scottish Government. 

The hope is now that with new connectivity solutions to legacy issues that have been felt worst in Scotland for almost 15 years, the next challenge for government and energy suppliers is winning back the trust of customers like Mary.