The Government has published its plans for the national roll-out of smart meters, saying they will save the average consumer £23 a year.
The meters show homeowners how much gas and electricity they are using to help them save money and cut carbon emissions, and can be read remotely by suppliers, spelling an end to estimated billing.
They will also pave the way for “smart grids” in the future which will be able to manage supplies more efficiently, for example by automatically turning appliances on and off to reduce demand or make the most of intermittent wind power.
The £11 billion roll-out of 53 million gas and electricity smart meters will get under way by 2014 and be completed by 2019, the Department of Energy and Climate Change (DECC) said as it published its plans for the scheme.
Householders will pay for the cost of the meters through their bills, although no one-off or upfront charges will be permitted for installing the meters.
According to DECC, the scheme would save people £6 billion, cut costs to suppliers by around £11 billion which it said should be passed onto customers, and save the UK £1.5 billion thanks to reductions in greenhouse gases.
A net benefit of £7.3 billion would be seen over the next 20 years, officials said.
Consumers would save money on their bills because they would be able to see in real time how much energy they are using and what the tariffs are. Smart meters are also expected to make switching suppliers easier.
And because energy companies will have more accurate data for billing customers, they will be able to reduce their costs by ending home meter reading and reducing the number of calls to call centres.
Climate Change and Energy Secretary Chris Huhne said: “Smart meters are a key part of giving us more control over how we use energy at home and at work, helping us to cut out waste and save money.
“In combination with our plans to reform the electricity market and introduce the green deal for homes and businesses, the roll-out of smart meters will help us keep the lights on while reducing emissions and getting the best possible deal for the consumer.”
Energy minister Charles Hendry said: “Smart meters will enable us to modernise the electricity system over the coming years and create the smart grids we will need to bring new low-carbon energy sources online, and handle much higher demand for electricity as we progressively electrify transport and heating.”
Under plans to cut emissions, a major shift towards electric cars and heating systems such as air-source heat pumps is expected, raising demand for electricity.
Managing the grid more efficiently will be needed to make the most of supplies, such as the increase in intermittent renewables, for example by charging electric cars overnight when demand is low, although electricity could be being generated from offshore wind.
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