In our Podcast series “Sh*t You Wish Your Building Did!”, Memoori explores the intersection between technology and commercial buildings through interesting conversations.

For Episode 33, we were joined by Nick Hunn for an in-depth discussion on the UK Government’s smart metering project, which began in 2009.

Role forward 15 years, and by some quirk of fate, the same guy from 2009, Ed Miliband, is now back in charge of UK Energy Policy. So, spurred on by Nick’s excellent article, it seemed like the ideal time to look back at the smart metering project, what went wrong, and what it might mean for UK Net Zero goals.

Don’t forget you can now Subscribe to our Podcasts on Soundcloud, iTunes, YouTube, and Spotify.

The UK Smart Metering Fiasco!

James: Welcome everybody and a big welcome to wireless technology expert Nick Hunn, lovely to have you on the podcast.

Nick: Hello thank you very much.

James: I read your excellent article Nick on the UK smart meter program and that’s why I’ve asked you on because um I thought it’d be great to talk about this fascinating subject um so by way of introduction this is something that uh for those that don’t know right in in this year July this year UK had a change of government and by some I guess Quirk of Fate right that uh the guy that was in charge of UK energy policy in 2010, 2009 is now back in charge 14 years later so I think that’s probably what sparked uh this renewed interest in in the UK smart meeting program and uh yeah I will link the article in the show notes so if anyone wants to read it please go ahead so I think what what stood out to me Nick was your phrase a classic example of a government it disaster and I think as most people will know there there are many so I a good place to start might be to give us a summary of you know what the what this smart meing program was supposed to do and when it was announced uh for 15 years ago.

Nick: Okay well I mean the the basics is it was rolling out Smart Metering so going back to the the very Basics what’s a smart meter and why do you want them um a smart meter is a meter that you’ve got in your home it’s like your existing electricity or gas meters but it provides far more information on what you’re actually doing if you look at a standard what are called dumb meters the ones we typically have they have a running total of how much energy you’ve used and every 3 months months or six months or every year somebody used to come around read it and you’d be billed against what you used nobody neither the electricity supplier or the householder knew how much the individual appliances they were using were actually costing on that um it was a bit like if you went to the supermarket once a year they would say oh you’ve bought 2,500 worth of stuff this year um just pay me for it now and it’s an odd model because it’s one of the few things that we pay in  with no real idea of how much we’re using and what the bill is going to look like smart metering sort of grew on what was initially called automated metering systems and those were meters that every day or every week or every month would send back how much you used in that period and that meant that your utility could at least bill you on what you’d actually use rather than trying to estimate what you might use and generally charging you more as a way of persuading you that you ought to read your meter and tell them what you’d actually done um we’ve had AMI systems around the world for quite some time I’m they’re liked by utilities because they don’t have to employ a metering Force to go around but generally we didn’t have very many of them because the cost of putting them out was more than the cost of having a little man or lady go around and reading a meter every six months what the benefit of smart meters are is that they provide more information to more people and the theory was that if you combine the benefit to all of those different stakeholders then it would be worthwhile and cost effective to install them so you would still have the benefit to the utility it would tell them how much energy you’re using if you could provide that as real time information to a customer then they could see what they’re using in terms of electricity and gas spend more or less in real time so if you turned your kettle on you could see that it was going to cost you 10 or 20p to boil the water if you’re having a shower if it was an electric shower you’d realize you could probably be better off being dirtier than you normally are um but it meant that customers could see a real benefit because if they had that information they could make choices and that ought to reduce their energy bills and the more important one going forward as we move to a mix of intermittent um energy generation as well as sort of Base load and that’s because we’re going to look at more and more wind and solar power that same information on usage could go back to the grid and the generators so that they can make far better informed decisions about how much energy is going to be needed at particular times and hence be able to negotiate better prices when you’re looking at the energy balancing and the theory was if you put all of that together then the overall returns would be greater than the cost of pushing out those meters and there’s nothing wrong in that that’s perfectly good reason lots of countries around the world have gone round and done smart metering because of that the problem that we came across in the UK is who was put in charge of doing it normally and I think in almost every other country in the world the network operator has been in charge of deploying meters so they have a vested interest of first of all making it work for them because they’re the network operator they can then put meters in street at a time so it’s a more costeffective way of putting them in you can plan what you’re doing the information the network operator needs is very much the same information that the consumer needs so that comes on top of it and then almost sort of as a last benefit the utilities get that information automatically as they would have done with an earlier smart metering system and had we taken that approach I think everybody would have been quite happy it may still have been a bit of a fiasco in rolling it out but it would have done what they wanted instead the view of the government was to give the job of rolling smart metering out and in fact of Designing the meters to the utilities and they really only had one view in mind which was oh this is a cheap way of getting somebody else to pay for us to have automatic metering and we don’t really need any of the rest of the stuff and so we’ve got some really poorly designed meters that were rolled out they’ve been built by companies that have very little experience in how to build them and nobody is really using or getting access to any of the data that would make them valuable now normally if this was a government funded scheme the treasury would probably jump be jumping up and down and saying we’re not seeing what we’d hoped we’d see as a benefit from this but they did a neat trick was to say that these meters could be paid for by adding the cost of those onto consumer’s bills that way the treasury never saw it as a problem um the utilities didn’t see it as a problem because it was just a cost they passed through and nobody had any real interest in actually looking to see if it worked and as it has gone on has become more and more obvious that it is not working in delivering any of those benefits which had been expected now we’re not alone in that I mean I remember a good 10 or more years back sitting in a conference over in California which was going through the same thing at the same time and the CEO of one of the energy companies there said the best thing about these smart meters is it gives us more evidence to blame the customer and that’s pretty much the attitude that we have seen throughout the industry as if we look at our utilities they’re not particularly technically Advanced um if we just look at the way they’re billing I mean for them spreadsheets are still quite new um they aren’t working out what to do with the data and because they don’t understand the data they don’t understand the benefits that customers might get from them um and so it’s almost sort of a vicious circle going into the lowest common denominator of design whereby nobody wins.

James: Very very interesting so I think you’ve done an excellent job there of summarizing it and I guess that’s sort of like where we are at the moment that no PE I guess it’s just gone on and on right nobody has really taken control of it it’s just it wasn’t a problem for the government and it’s carried on I mean is there are there signs that that people are talking about now that they’re going to end it or they’re going to change things?

Nick: Not obviously um unfortunately the one thing which seems to have stuck is the government’s Target to say we need to have these smart meters in every home and whereas it started off saying well this is voluntary customers can decide whether they want them we’ve seen enough issues that more and more customers are saying I don’t want one of these um most of that is probably Prejudice but we are seeing the meter not working where is the actual Smart Meters designed to have 20 25 year life the inhome display which is the only bit that a customer will actually be able to get benefit from only has a 12 month design life and many of those are failing they use a wireless technology that’s largely been ignored by the rest of the world they don’t automatically connect anything on your phone or your WI Network they don’t use the common things like Bluetooth or Wi-Fi and it’s very much a legacy product that provides minimal benefit I we don’t know how many are working is you just think if you’re deploying a system where you are putting in an inhome display you’d at least want to monitor to see if it’s being used or at least if it’s still powered on but we don’t do that we have no idea how many of them are working.

James: Wow okay yeah and is there um I mean obviously they set this target then of of not just the wireless display but the actual smart metering of getting them into every single home I mean have they at least been able to track progress in that respect?

Nick: We’ve got figures from that um deck and then Bay and now the the new uh department for Net Zero are producing figures of the installation numbers there is a lot of debate as to where they are but we’re probably only just past the halfway mark in terms of total numbers of meters deployed um the government is putting pressure on utilities to deploy more even to the point of saying they’re starting to find them for lack of installation um none of which actually helps to push the messages to why people should have these so the pressure is to complete program and it’s almost as if it’s just saying we’ve got a tick box we just need to finish it and you think well it’s beginning to get a little bit like HS2 why don’t you just stop and say what do you actually want to do because as we now move into a far less difficult grid to manage because we do have an awful lot of um green energy coming in from intermittent sources we need to know more and more about this as the customers um particularly as we’re putting in things like demand flexibility schemes um in order to make this work better and it probably means that rather than pushing ahead we would do far far better with saying look it’s not working what do we actually need and let’s start thinking seriously about the next generation of smart metering that really work and deliver rather than just concentrating on pushing out connected devices that are probably close to being obsolete already.

James: So what do you think that we uh we need and at the moment you know 2024 if you were throwing away uh that old program had a blank sheet of paper what would a smart metering program look like?

Nick: I think a smart metering program needs to stop look at what we want um one of the issues I think around Smart Meters we have today which has added a lot to the cost is because they were being pushed out by the energy suppliers a feature that they wanted was the ability to remotely disconnect um household Supply um and they want that for two reasons one is that it means they can cut somebody off if they haven’t paid and it’s also easier for them to um bring new properties up and running when people move without having to send somebody in the issue with having that off switch is it means that if masses of meters are hacked and turned off at the same time it becomes a major issue in terms of energy Security in the country if you could turn off a million meters at once and then an hour later turn them back on again and bounce it up and down it’ll take out quite a lot of the grid that means that each one of these meters is now effectively a piece of national infrastructure structure in your home it’s the only piece of national infrastructure any of us have in our home and you could go with a much simpler smart metering that doesn’t do that I think there’s interesting things we could do which is I mean first and foremost make sure the data of those meters is far more easily available it should talk straight to an app on your phone it shouldn’t have to go through a custom piece of equipment that’s applied by a utility um we need to make sure that people understand how you can use that better there’s a lot more integration that’s going to be needed with making sure these work with local generation whether that’s solar cells on your house heat pumps which is I think another potential disaster down the line but that may be a subject for another day um but also if you just look at small storage batteries of sort of 2 to 3 kilowatt hours um you don’t need much more than that in every home to more or less level out demand for most of the country um so there’s a future going forward looking at distributed local Energy Systems which ought to go into that thinking of what goes in a smart metering um it’s not something we should be designing for essentially a business model that has been pretty much unchanged probably since the 1920s but looking at how do we put something in each home that is both safe secure and designed for our energy needs going forward over the next 20 to 50 years.

James: Yeah excellent points and like you said I think the sort of uh concept of having a wireless display whilst you know of course any information is useful but it’s sort of now redundant right with people carrying displays in their pockets we may as well not bother with that but yeah you and you’ve touched on their sort of this um the changes in energy transmission uh more distributed how and that’s that’s one part of of of the change we’re seeing with the grid there’s also the policy part right how and again this kind of ties back into the fact Ed Miliband now is uh is back in charge of UK energy policy how or does this program have any impact on UK reaching their Net Zero goals or is it sort of slightly like a just an aside thing that’s been going on and an annoyance?

Nick: I think it’s purely a side an and an annoyance um it can certainly have an impact um we do need to help people understand their energy usage and still I think we’re at the point where most people don’t know what it is that is responsible for a lot of their energy usage we have an issue that a lot of it certainly in terms of heat is because we traditionally have been building very poorly insulated homes um and that’s a problem that remains with us I mean about 2/3 of our housing stock has a poor energy rating and one of the things that we should be concentrating on far more is just looking at how do we take a fabric first approach in terms of insulation and making better use of the energy that we have and it’s one of those odd ones that sort of we’re probably both of an age we can remember when you used to get insallation grants for going and buying a sort of roll of fiberglass from B&Q to put in there is probably a lot to be said for that um of just going back to a lot of people to say how do you make your home more insulated better fit for energy um instead of which we have subsidies heat pumps many of which were going into buildings which really aren’t suitable for a heat pump um so some joined up thought I think needs to come in about that we are seeing more and more local Generation Um people are still putting solar cells out how do we usefully feedback in how do we look at sensible tariffs for all of that um it’s more I think taking a holistic approach for how do we make best use of our energy usage and also how do we then complement that with a move towards renewable energy um and understand that we might need to be pragmatic in some of these things um there is nuclear that has a part of it there has been 50 years of government dislike of nuclear for various reasons um but we need to think about what are energy needs um and what’s the most pragmatic step forward I mean China in a way if you look at a large scale is quite interesting because on the one hand you see the amazing growth of electric vehicles over there but at the same time the realization that many of them being charged with electricity generated by Coal fired plants and you say that’s an acronis it shouldn’t happen and that’s absolutely true but then if you say well 10 years down the line what’s going to happen is we’ll have even more EVS but most of those Coal plants will have been decommissioned and will they will have clean energy and you can see how you get to that long-term solution that you want and it worries me when I look at a lot of the sound bites from our current energy policy it seems to assume that you can do all of the right things together at the same time and history tends to say it doesn’t work like that we are going to need mixes of things um and how do you pragmatically roll those together to get the best result 10 15 20 years down the line rather than just a bland statement that sounds good in your next election manifesto.

James: Yes and well that brings a kind of political element to it right that energy policy really is about 15 20 years in the future not not five-year political Cycles unfortunately um I guess also I mean it’s okay to make mistakes right if you learn from them um do you think that that there have been any any lessons learned from this program or in your opinion?

Nick: It’s difficult to say until you get to the next program um because the current approach is we’ve got to finish the current one which suggests at least at one level no lessons have been learned um it’s the point of where do you say stop hitting your head against the wall it hurts so there were Lessons Learned or lesons enforced um and I remember on a security when I was sitting in the meeting and said well look there’s an issue here people could hack the meters and the response coming back from a utility was well why would anybody want to do that and their mindset was still around people sort of dangling 6p coins on a piece of string um as a way of tampering rather than thinking what does it mean if you actually change your vision and say this is a cyber security risk across the whole of the grid now those learning seem to have sat sunk in I mean not least because GCHQ came in and battered everyone round the head about this is what you need to do to do it properly but in terms of deployments in terms of thinking how could you make this more efficient to get the rollout happening not a lot of that seems to have changed and when you see some of the issues coming up with smart metering and we see the headlines of somebody’s been charged sort of 33,000 instead of 3,000 and you think this actually says your backend systems aren’t even doing the basics of checking to see if a bill is anomalous and that implies there’s no real learning of what data is about and how do you use data so I think there is a lot that still needs to to change because much of smart metering is so far out of the comfort zone of people within utilities that is a lesson being learned when you don’t actually understand what the lesson is?

James: Yes I suspect not yeah um I know okay I’m going to go there because you’ve mentioned heat pumps twice so I am intrigued and kind of similar right I mean we’re talking about bringing in electrical devices is there um what’s your opinion there then you think that this is also sort of something that is uh misguided?

Nick: I think it is and it’s there’s been a very good sales job on heat pumps as the way to make a home far more efficient um far more competent for electricity the issue is that an awful lot properties heat pumps don’t work very well um you don’t need to be up to sort of full passive house standards for a heat pump to work but you do need a well insulated house um if you look at the way that heat pumps are sold there’s quite an easy and simple way to say is my house well enough insulated for a heat pump and that’s find a cold Winter’s day turn your heating system down to 50° which is about the temperature of water you’re getting to get through a heat pump system and if it starts to feel cold you either need to insulate it first or put a lot more radiators in and the vast majority of British homes that’s going to be the case um we’ve also got the same sort of thing that happened with Smart Metering that one of the reasons the smart meters aren’t that bright is that the utilities went out to their existing suppliers of dumb meters and said can you make a smart meter now the those smart metering manufacturers I mean they’re really good at metal work they’re good at welding all of that sort of stuff but suddenly they were being thrown into secure Wireless comms and they didn’t know which way to look um if you had a CV and you just put sort of meter and zigbee and Wireless on you could have got a job the problem is there were jobs in places nobody wanted to be as most meter manufacturers tended to be agricultural instrument um equipment suppliers sort of 10 20 years earlier out in the sticks which wasn’t where Bright Young techies tended to work and we’re seeing the same sort of thing with heat pumps is because they potentially cannibalized gas boilers, gas boiler manufacturers are being encouraged to turn themselves into heat pump manufacturers they haven’t got the patents and the IPS for them they haven’t necessarily got the bright young people it’s a bit like sort of go back a 100 years a politician seeing cars come in would go out to sort of horse breed and and say can you do horses with wheels um and we just haven’t leared that if you’re making radical shifts in technology that will have impact on Industries and you need to think about what’s the most efficient way to get the product we want um rather than just saying well let’s see if we can evolve the people that are currently our suppliers um and that’s an issue for politicians no politician is going to want to say I’m going to support a bill that will actually result in industry in my particular constituency of going down.

James: I had um a couple more questions for you um one I mean we talk a lot on this podcast as well about commercial buildings it’s not they’re not particularly involved in the we talk well we’ve been talking more about residential but I’m also interested in your opinion on that I mean what if how do you see commercial buildings what their role is in our future energy infrastructure?

Nick: We’re probably seeing more happening in commercial buildings at the moment than we are in domestic to be perfectly honest not least because at the point of refurbishment um there tends to be money available to do that in a way that there’s not when you’re looking at individual homes um and also I mean for the residential we shouldn’t forget that there are very large numbers of homes that are in housing associations or councils and the cost of upgrading those let alone maintaining them is crippling for many councils within larger commercial buildings I think you’ve got a lot more opportunity um it’s often a lot easier if there’s a whole building refurb to do the complete Fabric and upgrade for that um and that’s important because if you’re looking for better insulated buildings you’ve got to think about the ventilation as well um it’s far more of of a whole building approach I think the interesting I aspect of that also is a renewed growth in looking at District heating um we’re seeing District heating schemes coming in which can work very well um for commercial buildings as quite amused to see the the association for that advertising in private eye presumably lobbying governments and thinking have you noticed how much the government noticed all of the Horizon and post office scandals in private eye um they might talk about it but do they actually read and do anything about it but it’s back on the agenda um and I think that’s good it has a mix we don’t see that much of it in the UK far less than you you see on the continent um so I think commercial buildings as well as having that more organized approach and ability to do a complete building upgrade um at one point where you can sit down and cost it and also most buildings when you’re looking at the facilities management going in you are putting in Far More control and monitoring than will go into a domestic house so you can actually see what changes and see what the payback is and cost it and manipulate it as you get along um and that in theory should provide learnings that can move out and it’s fascinating with all of the data from Smart metering virtually no research has been done on whether it actually helps um and I worked in an energy analytics startup about 10 15 years ago and one thing we saw is that people would make a change when they first got a um information about what they did but within six months it had drifted back to the norm um and it’s like so many things it’s like you sign up for the gym on the 1st of January but by February you’ve stopped going and we need to think of how can you change that maybe at some point some of this intelligence gets built into products themselves um but that’s something that people have been promoting for 30 years and it still isn’t really there and we we do see domestic usage going down year on year for the past 20 years it’s been decreasing but that’s mainly due to things like TVs and washing machines and fridges getting more efficient as the global regulations change.

James: Well that’s a good thing but uh yeah just one part of it yeah Nick fascinating conversation thank you for those uh you know I think you really uh really did a great job of explaining things very clearly and in easy to easy to understand terms. I was going to last thing I wanted to ask you is there one thing from things that we’ve discussed that you would want listeners to take away from the conversation?

Nick: I think the thing I would like people to take away is to think about how first and foremost this benefits the grid and there’s a a lot of me that would like to say think first and foremost about the customer because the industry does a very poor job of informing customers about their electric and energy usage but we are seeing massive changes happening in our grid and the most important thing I think for any government any minister is to look out into the future to say how do we secure our energy um the demands are changing generation is changing and we need as much data as possible to make it easy for the people that are both investing in generation and investing in the grid to understand what to do it and today with Smart Meters we are largely throwing that data away and it’s how do we use that better for our energy security has to be anybody’s number one.

James: Yes brilliant and a great place to finish. Thank you!