How does data sharing for customers with smart meters work?

The energy regulator, Ofgem, is making changes to the rules around how energy suppliers collect and use the consumption data from their customers’ electricity smart meters. When the changes take place, it means that suppliers will begin collecting half-hourly consumption data from smart meters, with customers’ permission, and using it for the industry settlement process.  Find out more about this below.

Right now, customers already have choice over how often their consumption data may be retrieved from their smart meters for billing purposes - they can choose from half-hourly, daily or monthly data options.

What is settlement?

Energy suppliers forecast how much electricity they think their customers will use and purchase based on that forecast.  Settlement is the industry process to reconcile the differences between the amount of electricity each supplier purchases and the amount their customers actually use.  Energy suppliers and generators trade electricity in half-hourly periods.   The settlement process is needed to sort these differences for each half hour of every day.

Most traditional meters record electricity consumption for a period of weeks or months and are unable to show how much was used in each half hour. The settlements process has relied on forecasts and profiling to estimate this.   With the increasing diversity of demands, coupled with the need for ever greater flexibility of our energy systems, we need more accuracy than ever before.

How smart meters help

With smart meters, reads from each half-hour can be taken and shared, rather than using estimates.   This means that energy suppliers have an improved indication of how much electricity is actually being used in each period throughout the day.   They can then buy more accurately with less waste.   The potential cost benefit of this can then be passed to the customer.   Overall, the benefits may include lower bills, reduced environmental impact, improved security of supply and enhanced customer service.   Ofgem, the energy regulator, predicts that such reform of settlements will see net benefits to British consumers of between £1.6bn and £4.5bn between now and 2045.

How does this affect me?

These changes are expected to take effect sometime in 2025, although we will need to begin gathering data in advance of that to allow the systems to be populated.   We will write to you nearer the time to ask for permission to access your half-hourly data for settlement purposes.   Then, with your permission, we will begin collecting your half-hourly consumption data from your smart meter and entering it into the industry settlement process as described above.

Here’s some more information on data sharing for customers with smart meters.