SSE failed to hit smart meter targets last year and its parent firm Ovo is forced to fork out £1.2m to Ofgem
- Ovo is paying out on behalf of SSE after it failed to meet smart meter targets
- This is not the first time the company has been unable to do so
- Smart meters have been plagued by issues since launching in 2016
SSE will pay £1.2million to the energy watchdog Ofgem after the supplier failed to meet its smart meter installation targets in 2019.
As Ovo Energy acquired the firm earlier this year and is counting the cost for SSE Energy Services’ historic issue.
Under the Government’s smart metering implementation programme, suppliers are required to take ‘all reasonable steps’ to rollout smart meters to all homes and small businesses.
This means providers are set individual annual targets for smart meter installations and Ofgem monitors performance against these targets.
SSE has to pay out £1.2m after it failed to meet its smart meter installation targets in 2019
Between 2016 and 2019, larger energy suppliers had to set annual targets for the proportion of their customers that would have smart meters by the end of each year. These targets are commercially confidential.
SSE failed to meet these targets and it is not the first time it has got into hot water over this issue.
Last year, it paid £700,000 to the energy redress fund after it failed to meet its smart meter target for gas meters in 2018.
Tony Keeling, managing director at SSE Energy Services, said: ‘Today’s news relates to the reporting year of 2019, predating Ovo Energy’s ownership of SSE Energy Services, which it acquired in 2020.
‘Since Ovo’s acquisition of SSE Energy Services, we have significantly improved our smart meter rollout programme, to ensure that we can install smart meters in more homes across the UK – a crucial part of our Plan Zero strategy and the transition to net zero.
‘Ovo Energy has consistently met and exceeded all of its smart meter targets, with over half of its customers currently benefiting from the technology.’
Due to the voluntary payment of £1.2million to Ofgem’s consumer redress fund, the watchdog has decided not to take formal enforcement action.
It said it is closely monitoring suppliers’ approaches to the rollout of smart meters and will use its discretion to hold suppliers to account if they do not meet their obligations.
SSE has failed to meet its smart meter installation targets for two years in a row now
The smart meter rollout has been plagued by problems ever since it launched in 2016.
The first generation meters, also known as SMETS1 devices, were found to have a fault where many stopped working after customers switched suppliers.
The second generation meters, SMETS2 devices, were meant to rectify this problem, however, many suppliers are still not installing these and continue to install the SMETS1 models.
The take up of the smart meter off has also been considerably less than the Government anticipated meaning the initial target date of every home and small business being offered one has been pushed back multiple times.
In June 2020, in light of coronavirus, the Government announced that the current rollout obligation will be extended until 30 June 2021 and that a new obligation to roll out smart meters will commence on 1 July 2021, which will see the rollout continue until mid-2025.
Richard Neudegg, head of regulation at Uswitch, said: ‘The UK’s smart meter rollout has had a bumpy ride, and even before lockdown stopped installations it was clear that the target to have one in every household by the end of 2020 was not going to be met.
‘Only 31 per cent of homes currently have a functioning smart meter, which the Government claims helps 80 per cent of users to save money.
‘The Government’s new four-year framework on smart meter installations ends in 2024 so it’s clear that this complicated rollout will not happen overnight.
‘If you want a smart meter installed now you will see some big changes to the process to keep you and the engineer safe.
‘Companies have developed “no contact” installations, which may need you to be in a different room to the engineer.
‘Advice will be offered over the phone rather than face-to-face, and engineers will wear protective clothing and masks.’
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