Smart meters to be fixed for free after rash of breakdowns

Ofgem announces new scheme amid fears that problems will affect race for net zero

Households are to be offered free replacements for broken smart meter displays after a rash of failures threatened to leave many consumers with no way of monitoring their energy consumption.
The new policy, which replaces a previous one-year-only warranty, was announced as energy regulator Ofgem unveiled a sharp cut in the price cap that will bring average bills down by £238 a year.
The wave of smart meter breakdowns is the latest problem to hit the rollout, which has been going for more than a decade and has repeatedly missed its targets.
The meters, which allow households and their energy suppliers to monitor usage in real time, are seen as essential for the switch to net zero and the rise of electric vehicles, whose owners need to know when tariffs are cheapest for charging their cars.
Smart meters are seen as an essential for helping consumers keep costs down, so they need to be reliable or easily replaced.
About 33m smart gas and electricity meters have been fitted since the rollout started over a decade ago – but millions have since become ‘dumb’ meaning they have lost their smart functions, according to consumer champion Which?
It found a key cause was that smart meters could not cope with customers changing supplier.
A survey of 9,000 people by Which? published last month found 40pc reported that suppliers often did not actually receive meter readings. A similar proportion reported that their monitors were not working and about 5pc found their bills were inaccurate.
Until now, households have been charged for repairs if a meter display broke more than a year after installation – a deterrent to having them put in.
Eight suppliers covering 60pc of the energy market have signed up for Ofgem’s new free repair scheme so far. They are E, E.ON, Good Energy, Octopus, Ovo, Scottish Power, Utilita and Utility Warehouse.
The adjustment is one of several introduced alongside today’s overall cut in prices, which masks some new levies introduced by Ofgem.
One additional charge, costing a nominal £28 a year, will go to suppliers to cover unpaid debts by customers and will be added to the bills of direct debit payers. Another charge of £11 a year will be abolished, so the net cost to householders will be £17.
Prepayment meter customers will not have to pay the extra charge as they do not build up debts, Ofgem said.
Another levy will support prepayments customers, who will also no longer face higher standing charges – typically around £21 a year. The cost will instead be spread across direct debit billpayers, costing them another £10 a year.
The overall effect of the levies, said Ofgem, is that prepayment customers will save around £49 per year while direct debit customers will pay £10 more each year.
Ofgem chief executive Jonathan Brearley said: “This is good news to see the price cap drop to its lowest level in more than two years – and to see energy bills for the average household drop by £690 since the peak of the crisis – but there are still big issues that we must tackle head-on to ensure we build a system that’s more resilient for the long term and fairer to customers.
“That’s why we are levelising standing charges to end the inequity of people with prepayment meters, many of whom are vulnerable and struggling, being charged more up-front for their energy than other customers.
“We also need to address the risk posed by stubbornly high levels of debt in the system, so we must introduce a temporary payment to help prevent an unsustainable situation leading to higher bills in the future. We’ll be stepping back to look at issues surrounding debt and affordability across market for struggling consumers, which we’ll be announcing soon.”
Richard Neudegg, director of regulation at Uswitch.com, said: “While no one will be describing £1,690 as cheap, after more than two years of eye-watering energy bills, hard-pressed households may finally dare to hope that the worst is over.
“But this price cap will apply from the start of April to the end of June, so the prospect of lower prices does not help consumers trying to power through the rest of this winter.”
Craig Lowrey, principal consultant at Cornwall Insight, said the price cap is unlikely to be the ticket back to pre-energy crisis bills.
He said: “While the prospect of lower bills is certainly positive, they still remain hundreds of pounds above what customers were paying at the start of the decade, with little to indicate that will be changing any time soon.
“Fundamental questions remain on how to address the challenge of affordability for households. 
“Ultimately progress requires investment in a resilient, sustainable, energy system, one based on renewable energy supplies and improved energy efficiency. As we approach the general election, we would urge politicians to prioritise this critical issue and unveil solid plans for action.”
Simon Francis, co-ordinator of the End Fuel Poverty Coalition, said: “Even after this latest change to the price cap, energy prices remain 60pc higher than they were before the energy bills crisis began.
“Three years of staggering energy bills have placed an unbearable strain on household finances up and down the country. Household energy debt is at record levels, millions of people are living in cold damp homes and children are suffering in mouldy conditions.
“Everybody can see what is happening in Britain’s broken energy system and it is time for politicians to unite to enact the measures needed to end fuel poverty. This includes cross-party consensus on a long-term plan to help all households upgrade their homes and short-term financial support for households most in need.”