Sue Chetwin, Consumer NZ Chief Executive

The Parliamentary Commissioner for the Environment’s report on the rollout of smart electricity meters has realised all our fears.

It’s not that we don’t like smart meters, they have potential to bring benefits for consumers, but as Commissioner Jan Wright says, the majority of meters being installed are not smart, they are dumb and any benefits will accrue to power companies.

Smart meters replace old meters with an electronic unit. Instead of your meter being read six times a year, the electricity company can read it every 30 minutes. Some 1.3 million households will have new meters within four years.

The benefits to industry are obvious - billing systems are improved, collection costs are reduced and a huge amount of data becomes available on consumption patterns.

The benefits could be there for consumers too - as long as there is a choice between cost-reflective tariffs for those who can afford to switch off in peak time, and importantly a flat rate or average rate for those who can’t and who might otherwise be forced to make unhealthy choices. The commissioner is strongly recommending a flat-rate option.  We agree.

Dr Wright is also recommending these meters really be smart. Some 800,000 are going to be installed that won’t be. That’s because electricity generators are deciding the functionality. The commissioner is recommending one key function - home area network (HAN) capability. This is what will provide most benefits for consumers (and the environment) by allowing people to monitor their electricity use and decide when to shift and shed load, and potentially in future smart meters interacting with smart appliances. We agree HAN capability should be mandatory.

Also of concern is power companies are installing different kinds of meters, which may present barriers to consumers easily being able to switch to different suppliers. Open protocols between companies are being recommended. We believe these should be mandatory.

The report from the Commerce Commission on electricity market competition showing price gouging of consumers means a light-handed regulatory approach to electricity supply does not work. Despite that, the rollout of smart meters is being driven by the market. Electricity is too important a utility for that. We urge the government to heed Dr Wright’s recommendations.

Sue Chetwin
Chief Executive
Consumer NZ

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