Mr Smart Meter takes charge of UK energy policy

What could possibly go wrong?

Back in 2009, when Ed Miliband was Energy Secretary in the closing days of Gordon Brown’s Labour government, he announced Britain’s Smart Metering programme, promising to install smart meters in 26 million homes by 2020.  He stressed that “it’s important we design a system that brings best value to everyone involved”, with projected consumer savings of billions of pounds.  Fifteen years later, it’s still floundering, having cost consumers over £20 billion.  Now Ed’s back as our energy supremo.

The Smart Metering programme had a goal of installing around 40 million separate smart meters by 2020, covering both electricity and gas.  Since Ed kicked it off, it has been supported by every successive Government, ignoring any reported shortcomings.  Shortly before Labour’s landslide victory, with Ed Miliband being reappointed to the role of Energy and Climate Minister, it emerged that  only around 60% of those meters have been fitted.  Between four and five million of them are no longer working properly, and in a few years’ time, when the 2G and 3G networks get turned off, another half of them will stop working, needing replacement.  Shortly after that, the first smart meters will reach the end of their working life.  Unless something major changes, Britain will not get a comprehensive, operational  smart meter deployment before the mid 2030s.

The entire project has been a fiasco.  Because it is off the books of the Treasury, and paid for through domestic energy bills, successive Governments have let it live on, despite intense criticism from the National Audio Office and the Public Accounts Committee, where Labour’s Meg Hillier branded its vision of helping consumers with their energy bills still a distant one. Along with others, I’ve frequently pointed out its technical shortcomings.  Even Ed Miliband criticised one of its worst excesses – accusing the outgoing Conservative Government of a “dereliction of duty” when energy companies started using court warrants to fit pre-pay meters.   But nobody in any party has stood up and demanded that the programme be stopped.   It is a classic example of a Government IT disaster.  The cock-ups have been so consistent and so ingrained that it is being likened to the Post Office Scandal.  It has even been suggested that ITV commission a drama on the smart metering scandal as a follow up to their Post Office Horizon series.

To be fair to Mr Miliband, the original concept of smart metering was a good one.  Smart meters should help consumers, the grid and the energy supplier, generally in that order.   The problem, as was pointed out back in 2009, is that the way the programme was structured got almost every decision wrong, putting it in the hands of the companies who understood least about it.  Successive Ministers and DECC (followed by BEIS) made decisions based on largely on technical illiteracy and glib PowerPoint presentations, giving the work to companies with minimal experience of how to implement it.

The failures have been well documented.  What should have been a major example of Britain’s leadership in smart energy is seen as a joke by most other countries, many of whom have implemented far cheaper and more effective smart metering systems in a fraction of the time.  All that the UK gained was a few months of political posturing, where Ed could tell a good story on the world stage.

I hope that in the intervening years, Mr Miliband has had a chance to observe the process and reflect on what went wrong.  There is still time to halt the current smart metering programme before any more money is wasted, then take time to see what we really need before starting again.

But I worry.  Not least because of the rush to take the same position on net zero, with a similar lack of any evidence base.  If the UK could achieve net zero tomorrow, it would make no significant difference to global climate change.  Our emissions are petty cash compared to the continuing rush for coal in India and China.  Trying to set a date for “green” energy as a policy goal will probably only result in higher energy prices and make us reliant on imported technology. 

I’m not alone in worrying.  The day after his appointment as Secretary of State for Energy Security and Net Zero, the Spectator published an article predicting that the new Labour Government’s energy policy will be its first major own goal, suggesting that the new energy secretary’s vision will become a major liability for the new government.

What the country needs, and had long been in need of, is not a soundbite, but an energy policy that is based on sustainable jobs and business growth, rather that fantasy targets that will end up making Britain less competitive.  Most importantly, a policy that is transparent in its costs and benefits.

At the end of last year, Ross Clark wrote a book “Not Zero”, subtitled “How an Irrational Target Will Impoverish You, Help China (and Won’t Even Save the Planet)”.  It seemed timely in the run-up to a general election.  Most reviews of it make the point that politicians need to read it, as we have had a worrying political consensus which seems designed to hobble Britain’s economy, cost billions and be ineffective.  Sadly, nobody in our political parties appears to have read it or understood it, as there’s no sign of its common sense approach in any of their manifestoes.

There is a massive amount to do in securing our future energy requirements and demand.  I recommend reading Ross’ book and then writing to your MP to ask them to step back and consider what is best for our future.  Mr Miliband has already buggered it up once.  With fifteen years to reflect on how not to implement smart metering, I’d like to hope he’ll have realised that energy policy is more than just an opportunity for a soundbite and get things right the second time around. 

A new administration needs easy wins, not own goals.  Energy policy is never easy – it is a long term vision, which is so often lacking in politics.  Mr Miliband has an unusual advantage in having served in his role of energy Secretary, both in power and opposition, for sixteen years – an incredibly long time for any Minister to observe how an industry works.  He has seen a little of what works in terms of energy policy and a lot of what doesn’t.  Now is the time for him to show the benefit of that experience.  Unless we see more clarity and understanding in Labour’s emerging approach to the UK’s energy needs, then, as the Spectator suggests, Ed Miliband may well become the instigator of his party’s first major disaster.