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In the future, all electricity and gas supply points will automatically record and transmit the amount of energy being used at every property across the UK, creating a smarter, more flexible energy grid. The rollout of smart meters to small businesses is a key component of this development.
Commercial smart meters let business owners benefit from accurate, real-time information about their energy usage. Our energy experts have compiled this guide to smart energy meters tailored to business owners. Jump to the key sections below.
Contents
Small businesses will automatically receive a smart meter as part of the UK’s universal rollout. However, here are three reasons why you should consider requesting a smart meter installation early.
A smart meter will automatically transmit regular meter readings to your business energy supplier. In other words, no more manually reading the dials of each of your existing energy meters, saving you time and effort.
In the absence of readings, suppliers often estimate your business energy usage to calculate monthly bills. A smart meter ensures accurate billing by providing real-time usage data, preventing your business from being overcharged on its business electricity rates.
With a smart meter installed, your business can participate in the Demand Flexibility Service. This scheme offers financial incentives for businesses willing to reduce electricity usage during times of peak demand on the grid.
Smart meters are the latest generation of electricity and gas meters. They transmit real-time energy consumption data to your business energy supplier and business energy monitor.
Smart meters are currently being rolled out to both small businesses and homes, replacing older analogue meters. The fundamental function of the meter remains the same, with a few key differences:
Smart meters usually come in a bland-looking grey box with a digital display on the front. Here’s a typical example.
Smart meter technology is continuously evolving. Currently, there are two main types of smart meters:
These are known as “SMETS 1” or “Smart Metering Equipment Technical Specification 1” in industry terms. First-generation meters connect to the 3G mobile network, which is fine for sending readings. The issue is that these meters can’t be used when you switch business energy suppliers.
Second-generation meters, or “SMETS 2”, represent a more advanced generation of meters. They transmit data to a centralised network operated by the Data Communications Company. This centralisation means that all business energy suppliers can access the consumption data from these meters.
The Data Communications Company is undertaking a programme to upgrade first-generation devices to second-generation smart meters.
Ofgem, the energy regulator, has set binding targets for energy suppliers to achieve universal smart meter coverage by the end of 2025.
The universal smart meter rollout encompasses both home energy users and businesses. The type of meter your business will receive depends on your business’s energy consumption.
All businesses with an electricity profile class of 03 or 04 will receive smart meters:
Your electricity profile class is the first two digits of the MPAN associated with each business electricity supply point at your property.
The simplest way to find your MPAN is by looking at a recent business energy bill.
💡 Profile classes 01 and 02 are used for domestic electricity users, who will also be equipped with smart meters.
Commercial properties with higher energy consumption (profile classes 05 – 00) should already be equipped with advanced meters that transmit half-hourly meter readings. These businesses are not affected by the universal rollout of smart meters.
This regulation, implemented in 2017 and known as P272, marked the energy industry’s first step towards automatic meter readings.
For more information on whether this regulation affects your business, see our guide to large business energy.
The primary difference between a half-hourly meter and a smart meter is that smart meters can connect to a local network used by business energy monitoring devices. Smart meters not only communicate your consumption to your business energy supplier but also provide you with access to this data.
Source: BEIS – Non-domestic smart metering policy guidance.
You may request a smart meter installation from your current business energy supplier, provided that your business meets the eligibility criteria.
An engineer is required to visit your premises for a site inspection, to install the new meter, and to ensure its correct connection. The entire process usually takes less than two hours; however, it will involve a power cut for approximately 30 minutes. Therefore, it is advisable to make the necessary arrangements.
You can request your smart meter installation from your supplier using one of the relevant links for the biggest commercial energy suppliers:
For other smaller suppliers, you can use GB Energy’s search function to find the relevant page for your supplier.
💡 No obligation: Unlike domestic energy suppliers, it’s not mandatory for business energy suppliers to provide a free energy monitoring device with a smart meter installation.
Only second-generation smart meters are compatible across all business energy suppliers. Second-generation smart meters, installed after 2018, are manufactured by the following companies:
Source: Smart Me – SMETs 2
The only foolproof way to determine the generation of your smart meter is to contact the customer services department of your business energy supplier.
If you have a first-generation smart meter, it will continue to function, but it may not automatically transmit readings to your supplier. In such cases, you must manually submit periodic meter readings to avoid receiving estimated bills.
Here at AquaSwitch, we offer a business energy comparison service to help businesses switch to a cheaper tariff. Start today:
Our business energy experts answer the questions most frequently asked by small business owners about smart meters.
It’s not mandatory, and if offered an installation you may decline.
However, if your current analogue electricity and gas meter is at the end of its useful life, a business energy supplier will replace it with a smart meter.
Smart meters help business owners to better understand their energy consumption and avoid unexpected charges on their bills.
As part of the national rollout, business energy suppliers are required to offer smart meters.
Yes, second-generation smart meters are fully compatible with commercial solar panels and other forms of renewable energy for businesses. Owners of solar panels can export any unused electricity back to the grid under the Smart Export Guarantee scheme. Modern smart meters are capable of measuring both electricity imported from the mains and exported under the Smart Export Guarantee.
Smart meters automatically transmit consumption data to your business energy supplier. However, you can also use your smart meter to monitor your own energy consumption in two ways:
i. Using a Business Energy Monitor
A business energy monitor is a digital display that connects wirelessly to your smart energy meters. It collates consumption data over time, providing:
A business energy monitor presents smart meter data in a user-friendly format and can be placed in a convenient location, as opposed to the meter’s usual storage space.
ii. Using Traditional Meter Reading
Like traditional meters, you can manually read a smart meter. It displays a digital dial showing the energy consumption in kilowatt-hours (kWh) since the meter was installed. When switching business energy suppliers, it may be necessary to inform your new supplier of the reading on the switch-over date.