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Smart meter changes could see 'surge in pricing' for millions

·2-min read
UK smart meter users will be automatically enrolled into the new scheme which shares usage information with suppliers. (Getty Images)
UK smart meter users will be automatically enrolled into the new scheme which shares usage information with suppliers. Photo: Getty

A major change to the way that smart meters operate will allow "surge pricing" in millions of UK households.

Under new powers which will be granted to energy regulator Ofgem in May, smart meters will automatically send usage information to suppliers every 30 minutes, according to a report in The Telegraph.

Suppliers could then use this information to charge consumers more during peak times, if they want.

Ofgem has said that the change will be implemented on all new smart meters by 2025, but people who already have a smart meter now won't be affected unless they enter a new contract.

Still, the possibility of UK consumers being charged more during the busy periods, such as the mornings and evenings, is concerning for many given the current energy crisis which will see bills go up by 54% in April.

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At the moment, customers can share usage information with suppliers by 'opting-in' to sharing this data.

The new proposal is akin to the "time of use" tariffs already being used by some providers, which encourage consumers to use less energy during peak times by offering cheaper prices when demand is low and higher prices during popular times.

Ultimately, suppliers want people to use less energy during busy periods, because this means less need to upgrade grid infrastructures.

Supporters of greener energy also welcome the change because if people are using less energy overall, this could reduce the amount of carbon dioxide emissions being released into the atmosphere.

A spokesperson for Ofgem told The Telegraph: “This major system upgrade is a significant milestone on Britain’s path to net zero."

They added: “It will enable a more efficient, flexible and greener energy system which will save billions of pounds per year on all consumers’ energy bills.

“Ofgem will work closely with industry to make sure it delivers this major upgrade while ensuring those in vulnerable circumstances remain protected.”

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The energy regulator has said that while information will be sent by default, customers who do not want to share this data can ask to opt-out.