How millions of us could be being overcharged by our smart meters

Smart energy meters allow utility firms to ‘overcharge’ more than £50 a year on top of the gas and electricity you use, Money Mail can reveal.

There are 34.8 million smart meters installed in the UK, with users unaware that industry regulation cites meters as having a ‘tolerance level of between +3 per cent  and -3.5 per cent of actual usage’.

This means the customer can be charged 3 per cent more on a bill or 3.5 per cent less on a bill than the amount used – and this is not a sleight of hand, but set down in the small print of customer billing.

According to industry regulator Ofgem the average monthly energy bill is £153. So with a 3 per cent margin for error a typical home might pay £4.60 extra a month or more than £55 a year, which adds up to £2,750 over a lifetime of bill paying.

Energy users have been writing to Money Mail with their concerns about accuracy on their bills and they are then charged a fee – up to £192 – if they want to have a smart meter tested and it’s found to be working.

Inaccurate: Industry regulation cites smart meters as having a ‘tolerance level of between +3% and -3.5% of actual usage’

One in ten smart meters now no longer works properly, according to research released by the Government last month. 

The majority of these have gone ‘dumb’, so must be read manually like a traditional meter. However, in some cases they have been giving wildly inaccurate figures.

Artist Grayson Perry was stung with a £39,000 electricity bill by EDF Energy late last year instead of the usual £300, due to an ‘erroneous’ smart meter reading.

We asked electrician Mike Redfern-Jones why this might be happening. He has been fitting electricity meters for four decades, including smart meters since they were introduced eight years ago.

Redfern-Jones, who is based in Denbigh, North Wales, says: ‘There is no reason for the electric smart meters not to be totally accurate.

‘They simply measure how many kilowatts of power are used in one hour using a digital reader.

‘The microchip circuit boards installed should work perfectly without any measurement variation.

‘It is only the traditional fly-wheel style meters that contain physical parts that might wear down over many years where there might be a tiny discrepancy – and even this can take decades to show any differences. In my experience, older devices that go wrong tend to underestimate rather than overestimate usage.’

Energy giants appear to be taking advantage of old rules set out by the Government’s former National Measurement & Regulation Office laid out more than a decade ago before smart meters were introduced.

It states: ‘Electricity meters are considered “accurate” if the permitted margins of error do not exceed +2.5 per cent to -3.5 per cent throughout the entire load range at which the meter is designed to operate.’ For gas, the meter variation allowed is +3 per cent to -3 per cent. 

Suppliers have been quoting this allowance when customers query bills – and demanding up to £192 as a call-out charge if they find that nothing is wrong with the meter.

Smart meter customer Jon Walker, 73, of Warwickshire, says: ‘Perhaps we should all start paying 97 per cent of our gas and electricity bill to combat overcharging.’ 

The retired engineer discovered his gas bill was rising last summer – despite turning off the gas. 

He called provider Shell Energy (taken over by Octopus Energy last December) in June to report a fault with its meters that had previously worked well when installed a year earlier.

‘I was told there was nothing wrong with the meter and that if I called them out then there would be a £168 fee if it was found nothing was wrong with it,’ he says. ‘They acted like bullies. 

Overcharging risk: Customers using smart meters can be charged 3% more on a bill or 3.5% less on a bill than the actual amount used

So I got a gas engineer friend to turn off my gas for a couple of days. The meter continued to show I was using gas. Shell then came and replaced the meter for free and the problem was solved.

‘Initially, Shell then provided a £200 refund for overestimating the bill – but after I complained again, it magically recalculated and said I was owed £450. I also got £150 compensation.’

Jon says his annual energy bill was typically £1,800 – but was told consumption was ‘approximately six times the amount’ of the previous year due to wrong meter readings.

Had he not taken his own measurements and called its bluff the yearly bill may have soared to £10,800. No explanation was provided for ‘erroneous readings’.

Jeremy Barrett, 83, is another concerned about smart meter accuracy – despite Octopus Energy telling him there is nothing wrong with his equipment.

Overcharged: Artist Grayson Perry was stung with a £39,000 bill by EDF Energy due to an ‘erroneous’ smart meter reading

The retired security firm director from Wimbledon, south-west London, is one of those who must climb a ladder if he wishes to take his own readings.

‘Despite my requests, no one is prepared to come and check that the smart electricity meter is working correctly – but my bills have doubled to up to £600 a month since the meters were installed,’ he says. 

Jeremy, who was once a voice-over artist, says he was also not impressed when they sent him a complementary £60 electric blanket as a ‘vulnerable’ customer – rather than send someone out to see him.

He says: ‘I used to be in the SAS arm of the British Army. I don’t need tucking in.’

Octopus Energy says it has received regular readings remotely from his meter since it was installed in 2020. It adds it has ‘checked his energy usage and can confirm that it is in line with previous years’.

The £13.5billion rollout of smart meters began in 2016 and 35 million homes and businesses have had one fitted. They account for 61 per cent of all meters used.

A key reason energy firms are keen to install smart meters is that it saves them money because they no longer have to come out and read customer meters.

They also come with separate hand-held screens that let customers see in near-real time how much energy is being used.

Octopus Energy said: ‘The tolerance of an accurate smart meter is part of national legislation on smart meters – and not just specific to us.’

EDF Energy said accuracy standards are set by Ofgem. British Gas said all its meters were approved and certified by the Office of Product Safety & Standards. Scottish Power, Eon and Ovo Energy failed to respond.

This post first appeared on Dailymail.co.uk