How installing a smart meter can help mitigate rising energy costs

The key to reducing business costs is understanding what actually goes into our bills and the increasing impact of tax and system charges.

The price we pay for our energy will depend on many factors. Over 40% of charges on our bill is the wholesale cost of gas and electricity, with the remaining being other factors impacting the delivered pence per unit. This includes the cost of distribution, transmission charges, VAT, environmental costs and meter provision, as well as the energy companies supply costs.

Unfortunately, we can’t avoid today’s market or the increase in pass through charges we continue to see. However, some of these rising costs can be mitigated by careful and considered energy management.

The UK Government have set out new plans for the installation of smart meters in homes and businesses across the country. The aim is to roll this out over the next four years.

Smart meters are the next generation of gas and electricity meters. They enable users to see exactly how much energy they’re using in pounds and pence, whilst sending the information directly to suppliers. This means accurate billing and no need for suppliers to visit your property to read your meter.

The rollout will represent up to £16 billion annual savings on the cost of reaching net zero by 2050. Businesses with smart meters collectively save around £1.5 billion each year on their energy bills.

Energy suppliers are due to set ambitious targets for smart meter installation, with 21.5 million already in place. Prior to lockdown, 19,000 smart meter installations were taking place per day. Flexibility is being given around current targets due to the impact of lockdown restrictions.