27/04/2012 06:54 BST | Updated 26/06/2012 06:12 BST

Beginners Guide to the Smart Metering Programme

If the phrase 'smart metering programme' means nothing to you, then it is time to get reading. This is your beginners guide and will take you from novice to being pretty well informed on the new government programme. Why is this important? The scheme is set to take off in 2014 and will be rolled out to every home and small business in the UK - you can't hide from it!

So here goes...

What is the smart metering programme?

In March 2011 the Department of Energy and Climate Change unveiled plans for an ambitious programme that would see smart meters installed in every domestic and small business premise in the UK. That's right - all 30 million of them. They hope the rollout of smart meters will lead to a cut in energy consumption and save consumer's money, as well as reduce carbon emissions. Leading energy suppliers will deploy the meters, with fitting costs expected to reach £7bn. Some companies have already got the ball rolling but completion is unlikely to be until 2019.

What is a smart meter?

Smart meters are a new way of measuring the amount of electricity and gas that is used. They will replace the existing models, and because they are able to send electronic meter readings directly to your energy supplier, will bring an end to the annual visit from the gasman. Depending on the model, your new smart meter will send an accurate reading to your energy company via a long range radio or by an in-built SIM card.

How will you, the consumer, benefit?

What does this all mean for you? With smart meters sending an accurate reading to your energy company, estimated readings will be a thing of the past and over or under payment on your bills will cease. Ultimately, you will only be paying for the electricity and gas you use. Not only this, but the smart meters will display how much energy you are using on a real-time basis. Allowing consumers access to this information is expected to encourage more efficent energy consumption, resulting in lower monthly statements for households and businesses. However, if you want to save money you will have to actively engage with the programme and use the data that is available. The device won't save you money or reduce your energy usage - that is up to you. Anaylise the data you are given, and make sensible decisions based on that.

In the long run, consequences of the programme could be the introduction of personalised tariffs based on consumption and lifestyle, and cheaper fuel prices. Once suppliers establish when energy is being used most frequently they will be able to channel energy through the grid accordingly.

Are there any concerns about the programme that will affect you?

Any government legislation or consultation brings controversy and it is no differnet for the smart metering programme. Up until recently, consumers and industry experts had two major concerns that would influence public support. The first was about the exploitation of home and business owners during installtion, and the second was apprehension about privacy and data access. Recent government consultations drive away these concerns and place consumer satisfaction at the heart of its plan. If the new rules come into play then selling during deployment will be prohibited and suppliers wouldn't be allowed access to the smart meter data for anything other than billing.

uSwitch, a free impatial energy comparison site, have voiced their support for the programme and believe the consultations are an important step towards a successful scheme. "DECC's proposal for households to be able to control access to their data will pass the power back into the consumer hands," says Ann Robinson, Director of Consumer Policy.

However, others have trepidations about the longevity of the plan, voicing concerns that people won't have enough time to use the data smartly and instead, smart meters need to be able to automate energy usage according to real time.

Perhaps providing the public with data privacy rights, meaning the opportunity to have a highly effective and efficient energy infrastructure, creating a smaller carbon footprint, is further away then we think.

Worth the time and money?

That is for each individual to decide. The programme is an improvement on the old metering system and is a step or two closer towards a smarter energy system, but it requires engagement from the consumers in order for it to work. Without that, the data is futile and the energy usage will remain as it is.