Smart meters to cut fuelbills

The new meters will give householders an accurate account of how much power they are using and how much it is costing, which is expected to help encourage reduced energy use and environmental awareness. Instead of being hidden below stairs, smart meters could be a sleek flat screen in a kitchen or living room showing a display of power use in kilowatt-hours, pounds and pence, or even the carbon dioxide produced. The plans to make power firms install them will feature in the Energy White Paper. But industry experts warn that fitting meters could take a decade or more and cost up to 8 billion.

Some suspect that current meter replacement programs by power companies are part of a ploy to avoid them having to fit smart meters for as long as possible. Installation costs the companies money and the lower usage they encourage would knock revenue. "Smart meters that show energy use will lead to less usage of energy and give accurate billing information for the first time," said a source at energywatch, the consumer body set up to monitor power firms.

"We suspect that some firms are substituting meters with old-style devices that will not need to be replaced for up to 20 years." Howard Porter, director of the energy division of trade body the British Electrotechnical and Allied Manufacturers" Association, which represents the meter makers, said smart meters could be a huge benefit for consumers.

"It will cost about 100 for the basic first-generation smart meters," he said. The rest of the estimated price will cover installing complex infrastructure to process bills. One meter will cover gas and electricity, but householders will still be able to keep separate suppliers if energy regulators get their way. Porter said he did not believe energy companies were deliberately sabotaging smart meter plans. "There is a rolling replacement program of about 1.5 million a year out of 45 million meters," he said. "We suspect it will take ten years to fit smart meters."