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Suppliers charged up to 14p a day to rent out smart meters

Voice Of EU



The true cost of having a smart meter has been unmasked and it suggests the potential savings households are claimed they could make are offset by these hidden charges.

Energy providers have to pay several companies when providing smart meters to customers, known as Meter Asset Providers.

Rent can be as much as 14p a day for one meter – equivalent to £51.50 a year – showing exactly how much suppliers have to fork out every day.

It is likely these costs are passed on indirectly in the form of higher energy bills. 

Smart meters could be costing consumers as suppliers have to pay daily rent on each device

Smart meters could be costing consumers as suppliers have to pay daily rent on each device

Additionally, there are other charges for smart meters too. This includes a monthly fee for suppliers for communication reading adding another £20 and for places where this is hard to read, such as flats, the cost can be another £5.

The cost for Smart Energy GB – the Government-backed taskforce trying to convince all households to get a smart meter – is around £1 per household for the year. 

It has previous come under fire for paying celebrity spokespeople large sums to plug the devices on television adverts with stars such as Twiggy and Maxine Peake featuring. 

This brings potential grand total of £75 to 80 per year – or £750 to £800 over the course of a decade. This is far more than the potential savings customers are estimated to make from the devices.

Smart Energy GB claims each individual household is estimated to see a net benefit of £250 over the appraisal period, which cover the years 2013 to 2034.

This is a saving of £11.90 a year after all equipment has been paid for. After 2034, it says savings will increase to £49 for every year. 

The devices are not compulsory and take up plummeted last year, thanks to the coronavirus with 980,000 meters installed in the first three months of the year – compared to just 135,000 between April and June – a fall of 845,000.

By the end of 2020, 23,646,000 meters were operating. New targets have been put in place for individual suppliers, depending on their size.   

Whilst suppliers renting out meters isn’t a direct hit on consumers, it’s likely that suppliers will have to hike their prices to compensate for the money being spent on the meters.

Not only have prices soared in the last year, due to wholesale costs increasing, but the Ofgem price cap is also set to rise by £96 at the beginning of April with default customers set to see their annual bill rise from the current level of £1,042 to £1,138.  

Households up and down the country have been encouraged to have smart meters installed

Households up and down the country have been encouraged to have smart meters installed

Who do suppliers pay for meters? 

Energy suppliers are free to fund and install their own meters. However, most instead arrange for a Meter Asset Provider to fund their meters, which they then lease back from the Provider.

This is a commercial arrangement between industry organisations and energy suppliers who negotiate terms with the Providers with a number of Providers available for energy suppliers to work with.

These agreements also apply to traditional metering and allow for charges to transfer to the new energy supplier when customers switch provider, according to the Department for Business, Energy and Industrial Strategy (BEIS). 

Aside from paying the Meter Asset Providers, suppliers must also pay the Data Communications Company (DCC), a firm who services the devices and Smart Energy GB, the team responsible for the UK’s smart meter rollout.  

How much do they pay? 

Suppliers, on average, have to pay around 8p a day, per customer, to rent out a smart meter if they are contracted through a private company.

However, if no formal contract is in place, this can go up to 14p a day.

The smart meter rollout

There have been many concerns over the smart meter rollout since it launched in 2016 with lots of households encountering challenges with their first generation devices (SMETS1). 

Many 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 rollout has also been halted significantly due to lockdown and engineers being unable to get into homes.  

The take up, in general, 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.

Meanwhile, if a customer with a smart meter moves supplier, the invoice for that meter passes on to the supplier they moved to and they must continue to pay.

Suppliers also have to pay the DCC a daily pence per meter point for it to pass on communications – what the meter is saying passed on to the supplier.

For a medium sized challenger supplier, the fixed cost for 2020 to 2021 are 97.7p per month for electricity and 73.8p per month for gas for each meter. 

There is also additional costs for meters where it is hard to communicate with the in home display, for example, high rise flats, called Alternative Home Area Network.

These charges are 40p per month, per meter, for both gas and electricity.  

The cost for Smart Energy GB is relatively small coming in at around £1 per household for the year.

The price is based on the market share of the company but for one medium size challenger supplier, it went up 30 per cent in one year.

The DCC, which is wholly owned by the Government, get paid for communication to be passed on even if the supplier paying them has no customers with smart meters.  

This communication network is meant to cut the cost of each energy supplier having their own smart metering communications system and enables consumers to keep smart services no matter which energy supplier they switch to. 

Smart Energy GB has long advertised the benefits of the devices, with one of the main being the meters are free.

However, it is very likely that customers are charged more for their energy bills on a whole as a way for the energy providers to recoup the costs they are being made to pay.

Smart Energy GB admitted that consumers pay for the cost of their meter and its maintenance through their energy bills but said this is the same for both traditional and for smart meters.

It added the DCC get paid as it publishes a charging statement setting out how the charges for their services are passed on to their customers, for example, energy suppliers, network companies and other third parties.

Smart meters caused controversy with many saying theirs stopped working after switching

Smart meters caused controversy with many saying theirs stopped working after switching

Why has the price for suppliers increased? 

As above, one challenger supplier found their prices hiked by 30 per cent in one year. 

Customers are invoiced monthly a fixed charge based on the latest market share data which is intended to balance the cost of smart metering across the industry.

As the programme ramps up the costs are forecast to increase, but costs are expected to reduce overtime as the programme matures.

The recent increase in prices for suppliers can be primarily attributed to costs the DCC is incurring in migrating SMETS1 meters onto the national smart metering communications network.

Once SMETS1 meters are migrated, all energy suppliers should be able to operate them and so consumers will retain smart services when they switch suppliers.

This is something that has been an ongoing problem with the first generation devices. 

Once they are enrolled onto the national network, they can transmit data. 

Some 3.8million SMETS1 meters have been migrated onto the DCC system so far.

The DCC said charges are set so they accurately reflect the costs of maintaining and expanding the rollout.

It added the charging methodology was set by the Government and closely scrutinised to ensure they are fair and essential. 

If the DCC’s spend is not justified Ofgem can ‘disallow’ costs, meaning the DCC covers the cost, not customers.

Additionally, it it does not spend all of the charges revenue in a given year – it will always return the difference to customers through lower charges in the future. 

It said this week, the DCC will be taking the step to return £12million of under-spend earlier than the regulatory process.

This process was a proactive decision made by DCC to ensure cash is handed back to customers as soon as possible where it has made savings or costs that are delayed or deferred. 

A BEIS spokesperson said: ‘Energy suppliers have long been responsible for the provision of metering to their customers, whether smart or traditional, and the smart meter rollout does not change this.’   

It added the smart meter rollout programme has now broken even, meaning every future installation will not only help individual consumers save money but deliver a net benefit to the country.

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Property investors offended by ‘vulture funds’ label, conference hears

Voice Of EU



People in Ireland need to stop calling property investment firms “vulture funds” and development and building rules need to stop changing if the housing crisis is to be solved, property and banking sector representatives have said.

Marie Hunt, executive director of research at real estate firm CBRE, told an Irish Council for Social Housing conference that the “fundamental problem” in the Irish housing market “is a lack of supply”.

She said bureaucracy and regularly changing public policy were also issues, noting the political discussion this week about potentially changing the link between rent and inflation because prices were rising.

Ms Hunt said investors were not going to come into a market where the rules kept changing halfway through the game.

She said that calling investors “vulture funds” was unhelpful and that name calling “in the media” should stop.

“We need that capital and we need that investment.”

She said investors who bought a nursing home or an office block were welcomed but that those who bought housing received very negative publicity “and they don’t need that”.

Take interest elsewhere

Pat O’Sullivan, head of real estate research at AIB, said policy changes were problematic and that the term “vulture fund” was offensive to investors, who could take their interest elsewhere.

He said Ireland isn’t the only economy that requires funding and “we have got to be very careful about the amount of changes we make to policy, how we describe the investment”.

Ms Hunt said that from a developer’s perspective, many housing schemes were not viable due to high construction and “input” costs and “because we have raised the bar so high in terms of the planning regime and design requirements”.

She instanced the judicial review process, which has been used to bring challenges to fast-track strategic planning developments, as another problem. Ms Hunt said “anecdotally” developers were hiring senior counsel and barristers ahead of planners and architects, such was the level of challenges.

The conference continues on Thursday.

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Should the developer pay for my drive’s missing dropped kerb?

Voice Of EU



PROPERTY CLINIC: I bought a house with a drive that the developer never got a dropped kerb for, who is responsible for paying for one?

  • You have approached your local council about it paying for your kerb to be fixed 
  • The developer was issued with guidance by the local council to drop the kerb
  • No work has been carried out and the kerb needs to be dropped 

I bought a property that has a driveway without a dropped kerb. It is uncomfortable every time I drive over it. When I approached my local council about getting it fixed, it said the developer was under no obligation to drop the kerb. 

The council said I would have to apply for a licence to get it dropped. That licence costs £222.35. 

I will also have to pay for the work to be carried out. Is there anything I can do about this and why are developers allowed to build homes without dropped kerbs? MT

Parking space is at a premium and many want a drive, but you'll need a dropped kerb too

Parking space is at a premium and many want a drive, but you’ll need a dropped kerb too

MailOnline Property expert Myra Butterworth replies: Parking spaces are becoming highly desirable in many areas, as on-street parking restrictions proliferate.

Your developer was issued with guidance by the local council to drop the kerb. However, the local council in this case has confirmed that there is nothing in planning consent or elsewhere that required the developer to drop the kerb. 

Unfortunately, you have no claim against the original developer or the person from whom you bought the property. And so you will now need to apply to your local council for the kerb to be dropped.

Research by Direct Line found that during the past three years there has been a rise in the number of requests for dropped kerbs received by local councils amid an increasing demand for parking spaces.

Between April 2018 and March 2019, councils received an estimated 14,500 planning requests for dropped kerbs, rising to 14,700 between April 2020 and March 2021.

Stephen Gold, a retired judge and author, explained: Your local council is correct. In fact, it is sometimes necessary to also obtain planning permission for the construction of a dropped kerb: For example, if the kerb would be on a classified road or in a conservation area.

The fact that the all-clear has been given in the past to neighbouring properties for a dropped kerb is no guarantee that you will be as lucky because of changes in engineering standards and improvements in design. You may also be refused where, say, your property is on a bend or at a road junction or close to traffic lights.

The property was sold as it was, with no dropped kerb

The property was sold as it was, with no dropped kerb

You have no claim against the original developer or the person from whom you bought the property. 

The property was sold to you as it was: One driveway and no dropped kerb which would have been obvious, so you got what you bargained for. 

You would or should have contemplated that a drive from the property over the pavement might be an uncomfortable exercise. Had your seller agreed to bear the cost of construction of the kerb and associated expenses, the position would have been different.

But assuming that you bought with the help of a mortgage, the property would have been inspected by a valuer or surveyed on behalf of the mortgage lender and you may have organised your own private survey. 

If the process and expense of getting the all-clear for a dropped kerb was not raised in the inspection or survey report then you would have an arguable – although not a strong – claim against the report’s author or their employer. 

After all, section 184 of the Highways Act 1980 makes it an offence to drive over the pavement to get out of your property when the local authority has prohibited you from doing so in view of the absence of a dropped kerb and so this would have been an important matter.

You would have up to six years from the report to start what could be a county court ‘small claim’. You would be well advised to send details of the claim to whoever reported with a threat of proceedings if they do not pay up. If the claim is rejected by them, assess whether to take the matter further when you have the benefit of knowing why they assert they are not liable to you. 

Even making a small claims carries risks. You won’t get back the court fees if you lose and may have to pay the winner’s expenses for travel and loss of earnings in being at court.

  • Stephen Gold is the author of ‘The Return of Breaking Law’, published by Bath Publishing


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At the Ryder Cup, would 12 divided by three equal victory for the US?

Voice Of EU



“Pod” is not a golf word. And yet it has been on the tongue of nearly everyone in the golf community during the past, tense days before this week’s Ryder Cup, the biennial, pressure-packed team competition between American and European pro golfers that begins Friday.

Paul Azinger, the American Ryder Cup captain in 2008 and a former PGA Tour pro, deserves the credit, or the blame, for injecting “pod” into the golf vernacular. Thirteen years ago, after learning that Navy Seal units bonded by training and living together in small, carefully selected platoons, Azinger decided he would divide his 12-man team into three four-man units before that year’s Ryder Cup. The hope was that a finite, close-knit group could match the unity exhibited by Europe’s triumphant teams.

Called the pod system, Azinger’s four-man corps were chosen after each player took a personality test. Grouped together based on compatibility, the players did almost everything together before the Ryder Cup matches – practice rounds, meals, nightly table tennis games. When the competition started, they were paired together in matches and routed the Europeans to claim the first US victory in nine years and just the second since 1993. Azinger was celebrated for his innovation.

But in a show of the stubborn individualism that may be hampering the overall American Ryder Cup effort, the US captains who succeeded Azinger rejected or diluted his approach. Only one of those teams won, in 2016, when Davis Love III embraced the pod system.

‘Good concept’

At other team competitions in professional golf, including the Solheim Cup, which pits women’s golfers from the United States against those from Europe, leaders chose to adopt Azinger’s model with success and failure. Last month, the American Solheim Cup captain, Pat Hurst, implemented the pod system and her team lost, 15-13.

Even Azinger, now an analyst for NBC, has questioned the current efficacy of his idea. “The way I did it wouldn’t even work today, to be honest, even though the concept was good,” he said last week. “I just think the pods, they don’t work all the time. We keep getting beat. If everybody’s still using the pods, pods isn’t the answer. It’s something bigger than that.”

The pod debate has not stopped or impeded the discussion about the best way to replicate Azinger’s success on the American side. In the run-up to the event, the overarching intrigue is how Steve Stricker, this year’s US captain, will make up the two-man partnerships he sends out for the 16 matches against Europe’s two-man teams on Friday and Saturday. (On Sunday, the Ryder Cup concludes with 12 one-on-one singles matches.)

The American hand-wringing about their player pairings has generally been a source of quiet amusement for the European squad. Devising the pairings on their team is rarely controversial or the product of profound, multilayered planning. Players often form natural partnerships based on which European country they represent.

“The Europeans are bonded by blood, which means everything to them,” Azinger said. “The Spaniards play together. The Englishmen, the Irishmen, the Swedes, they’re bonded by something that really gives them a full-blown 1 per cent advantage.” Azinger said a 1 per cent advantage may not seem like much, but in the three days of a Ryder Cup competition, more than 4,000 shots are likely to be put in play. A 40-stroke swing, or 1 per cent, could conceivably decide a couple of matches, where one point is awarded for each victory and half a point for a tie. Europe has won nine of the past 12 Ryder Cups, but on four occasions the margin of victory was a single point.

Seizing on that 1 per cent edge, Azinger said of the Europeans: “They bring an intangible with them. It’s a fact.” Outside the golf world, there may be some precedent to explain how the European team’s geographic make-up improves its Ryder Cup results. Some of the strongest, most effective troops during the second World War were soldiers assembled from the same town or village, according to Charline Russo, a senior lecturer in organisational dynamics at the University of Pennsylvania and a consultant on executive coaching and team development.

“It wasn’t just because they grew up together, there was also that accountability factor,” Russo said. “You didn’t want to go home and admit that you screwed up.” Russo, who has a PhD in organisational leadership, has a deep familiarity with the personality tests that Azinger used 13 years ago.


Stricker, who was on the 2008 team, last week conceded that he would employ a variety of tactics to devise his pairings, although he declined to be specific on whether he would use the pod system. Russo said the assessments could be valuable tools, but cautioned, “You need somebody who knows what they’re doing with it because these things can be dangerous.” Azinger, for example, consulted at length with a clinical psychologist.

It may be even more difficult if Brooks Koepka, who qualified for the team but injured his wrist last month, is healthy enough to play. Koepka and his American team-mate Bryson DeChambeau have spent most of this year feuding on social media. Stricker has asked the two men to put aside their differences during the Ryder Cup, and each player has been discreet of late, but do not expect Koepka and DeChambeau to be paired for a match, or even assigned to the same pod – if there is a pod system.

Justin Leonard, who was a member of several American Ryder Cup teams including the 2008 squad, said that keeping Koepka and DeChambeau apart should be “real easy”, especially if the players are in pods. “We ate breakfast together, we ate dinner together, we played our practice rounds together, and when we were in the same room with the whole team, we sat at a table together,” Leonard said of 2008, adding that the arrangement provided a level of comfort because there were no surprises when the pairings were announced.

Additionally, Leonard, who is now an NBC golf analyst, said he expected the pod system to return for the Americans this week because Phil Mickelson, who was on the 2008 team, is a non-paying vice captain to Stricker. “Phil Mickelson was a big proponent of the pods,” Leonard said. “He loved that system. Him being a vice captain, I feel fairly confident that we’ll see something similar to that.” Azinger said he did not have a clue how Stricker might proceed. “I don’t know what’s he’s doing,” Azinger said. “He’s not told me.”

– This article first appeared in the New York Times

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