Metering – a suitable case for treatment
February 1st 2007

Alan Aldridge, executive director of the Energy Services and Technology Association (ESTA), argues it is time for a concerted effort to extend the benefits of competition to metering – in order to make most efficient use of our energy resources

Since privatisation, designed to bring down energy prices by introducing competition, some aspects of energy supplier have remained stubbornly resistant to market – or regulatory – forces. In the case of metering, this continues to cause consumers to waste energy and money, as well as restricting their freedom of action to change suppliers when desired. The energy efficiency industry and major consumers have not just accepted the situation however: the development and adoption of aM&T is witness to that.Now regulators and even government are launching initiatives to support the wider use of automatic Monitoring & Targeting or 'smart metering' as some call it. But, given the political urgency of making inroads into carbon emissions levels, ESTA believes that the different initiatives need to converge and to be brought together to work synergistically if the level of potential savings are to be achieved.

The continuing difficulties encountered by consumers in regard to metering were spelt out forcefully by Allan Asher, the chief executive of the energy watchdog, energywatch, at ESTA's annual aM&T conference in early February.

"With billing and underlying meter reading we can observe a disturbing tendency among suppliers to pitch their service proposition at the level of the regulatory minimum,"he told the audience."If we look at the supply license conditions,we see no standards for billing, and the only requirements for meter reading, which is the basis for accurate and timely billing, relating to meter safety; where these apply, they only require a visit every two years and even these look set to disappear following the current supply license review." This lack of clarity has hampered energy consumers ever since the energy markets were privatised, beginning with British Gas back in the 1980s.And anyone that thinks the Government will now address the issue – especially given the security of supply and climate change issues – may be disappointed. Allan Asher should know and he believes that change through regulation change is not very likely."We are living in an age of light touch regulation where experience has shown us that commercial issues are left to the market to resolve,"he noted.

The conference brought together the key players in this area – regulators,watchdogs, equipment suppliers and consumers.The focus was to examine ways in which the various players could work together – to everyone's benefit.The fact that SMEs and many smaller governmental bodies such as Primary Care Trusts and some local authorities cannot obtain contracts which include supplies of data, and the fact that the gas metering market is still heavily biased in favour of a single supplier does not suggest that privatisation is delivering all it promised.And remember that the gas market was privatised over 20 years ago! Metering, the basis of the relationship between supplier and customer (after all, this piece of equipment is the only real way that both sides can tell how much energy has been consumed) has been left on the sidelines.Yet for effective energy management, bill control and emissions reductions, it is crucial.

The energy efficiency industry has now come up with a technology – aM&T – that simplifies the process of analysing data and monitoring performance.However, access to the raw data remains a problem for many customers.Too often, in order to get accurate data, consumers have to go to the expense of installing their own metering – often duplicating the utility-owned equipment.

ESTA believes that the utilities' continuing reluctance to use actual meter readings for billing purposes is inexcusable.The technology exists to do so and has been available for some time.Many consumers have been forced to buy their own meters to obtain the data for themselves.

The recently published Stern Review called for major investment to combat climate change.We are asking for just a small exercise in 'joined up thinking'by different Government departments, regulators and the industry. Let us bring together the initiatives aimed at bringing the metering business into the 21st century and focus them on breaking this logjam once and for all.

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