Finally, a Chance to Restore Broken Trust in the Energy Market

Imagine this. You're doing your regular supermarket shop, filling your trolley with groceries for the next week. But when you go to pay at the till, you are told that you won't find out what your shop costs for several months. It's only at the end of the quarter that you receive your bill from the supermarket, for all the shopping you've done in the last three months. Hopefully when the bill comes, you will have managed your household budget well enough to be able to pay...

Imagine this. You're doing your regular supermarket shop, filling your trolley with groceries for the next week. But when you go to pay at the till, you are told that you won't find out what your shop costs for several months. It's only at the end of the quarter that you receive your bill from the supermarket, for all the shopping you've done in the last three months. Hopefully when the bill comes, you will have managed your household budget well enough to be able to pay.

And there's another catch. When you receive your bill, it's a lump sum with no way of checking whether you've been charged the correct amount. You're not sure if your bill reflects the food you've actually bought. It's not straightforward to find out whether you might get a better deal elsewhere, because you can't see what each item costs and how much you might be saving.

It's a ludicrous scenario which, you'd hope, would never pass muster with today's empowered customers, but in 2014 the UK's energy sector, held back by out-dated technology, is operating in a startlingly similar way.

Do you know whether your energy bills are accurate? If the answer is no, you're not alone. Two fifths of people in the UK are worried that they pay for more energy than they actually consume, and more than a third of us do not understand our energy bills.

The issue lies with the antiquated system for recording energy use and managing billing which is out of kilter with a digital world. In an age where we can compare, record and track much of our household spending at the touch of a smart phone, it's unbelievable that most of us can only work out the cost of our gas and electricity by craning our neck into a cupboard to read a meter by torchlight.

The energy meters used in most UK households have an extraordinary amount in common with the early models from the 1880s, at least when it comes to informing customers about what they are spending. These meters were introduced to Britain in the same year as the first piece of music was recorded on a wax cylinder. Think how music technology has transformed, multiple times, since then. But gas and electricity meters have largely stayed the same.

Of course, there's nothing wrong with old technology if it is still fit for purpose. The problem with today's meters is that they come with a lack of transparency that frustrates consumers, and is almost certainly frustrating many energy suppliers who want to restore their customers' trust. With prices and usage almost incomprehensible, many consumers feel confused about their bills, and are held back from switching because they can't work out who is offering the best deal.

It is no surprise then that more than half of those questioned in our survey of 10,000 UK residents said they do not trust any energy supplier. This figure is even higher among vulnerable groups, with six in ten respondents living in fuel poverty or with a disability distrustful of any supplier.

So what's the solution?

Households need to be able to take control of their energy use and bills. Crucially, we should be empowered with better information to work out which energy company is offering the best deal, or switch with confidence if another supplier or tariff will offer us better value for money.

The answer lies in new technology: smart meters.

Between 2015 and 2020, almost 50 million gas and electricity meters in over 26 million homes will be replaced with smart meters, providing households with real-time accurate information on energy use and costs. Consumers can see what they are paying in pounds and pence, and if there is a better deal around, they will be able to change energy supplier or tariff more easily.

This visibility will help all households to manage their costs and give them more power over their bills. Vulnerable consumers, who frequently rely on pre-pay meters, will finally be able to buy gas and electricity as easily as pay-as-you go on a mobile phone.

British consumers are crying out for change in the way we currently buy gas and electricity, and now there's light at the end of the tunnel. By 2020, Great Britain will have experienced an energy revolution, and the old technology will at last be a thing of the past.

For analogue gas and electricity meters it's time to make a space in the museum, alongside those wax cylinders that held the first music recordings. They once served a purpose, but thankfully will very soon be obsolete.

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