Ofgem is set to make some major changes to smart meters that may help homeowners with their bills.
The energy watchdog will be ensuring that meters automatically send updates on energy usage every half an hour from May. The move means that suppliers will be able to bill more accurately, therefore customers won't have to make payments based on overestimates.
The Telegraph has reported that Ofgem will be granted legal powers in May allowing it to bring in changes by 2025 to make 30-minute updates the default, with an option to opt out. “This major system upgrade is a significant milestone on Britain’s path to net zero,” an Ofgem spokesman told the paper," an Ofgem spokesperson told the paper. "It will enable a more efficient, flexible and greener energy system which will save billions of pounds per year on all consumers’ energy bills."
READ MORE: Martin Lewis' advice on whether you should fix your energy rates
It comes as homeowners are paying 54% more a year as energy bills have skyrocketed due to the price of wholesale gas. The energy price cap was also increased last week, adding almost £700 on to the average household bill.
The change will also allow suppliers to introduce more time of use tariffs. At peak energy use times, such as early evening, costs would be higher for consumers, while prices would fall for those using energy overnight. Experts have suggested the proposed changes to pricing would see struggling households forced to limit their energy use during peak periods.
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However, the founder of TheEnergyShop.com, Joe Malinowski, said surge pricing could make energy “unaffordable” for people at peak times. He told the Daily Mail : “Some households will inevitably have power outages during peak times when energy potentially becomes unaffordable. We already see extraordinary swings in the price of energy and this is likely to get worse.”
Three major energy companies – Scottish Power, EDF and Octopus Energy, which have 11 million customers between them - all previously backed plans for 'price surging'. They supported the idea of introducing dynamic pricing arrangements where smart meters automatically send regular updates to suppliers about household energy use.
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