BEIS Consultation on the New and Replacement Obligation (NRO) Activation Date
In our response we highlight the risk of inactivity in the non-domestic roll-out and recommend two further exceptions to the NRO that would maintain momentum by allowing suppliers greater flexibility in the metering they can offer their non-domestic customers.
We are concerned that the NRO will delay the roll-out of smart metering to non-domestic customers
The consultation letter states that the NRO is intended to drive the roll-out, however; current policy and market conditions in the non-domestic sector will produce the opposite effect. In conjunction with the expiry of the Advanced Meter Exception (AME), the lack of a 3-Phase electricity Smart meter and workable Alt-HAN solutions; the NRO will unnecessarily halt progress in the non-domestic roll-out and excessively restrict consumer choice.
Prioritisation of the domestic roll-out will exacerbate this by diverting dual band comms hub availability and supply chain capacity. If suppliers were granted more flexibility in offering alternatives to SMETS2 then these issues could be avoided by leveraging well-established supply chains for Advanced metering – a technology that delivers equivalent benefits and better satisfies the requirements of the non-domestic sector.
Suppliers’ options have not been clearly communicated, which is limiting opportunities to maintain roll-out momentum
The “non-microbusiness exception” helps to mitigate the above but BEIS have not communicated this policy very effectively and as a result many suppliers are unaware that it exists or do not understand how to apply it.
Without clear and unequivocal guidelines on the exceptions to the NRO, its activation has the potential to cause similar levels of misinterpretation and ambiguity, which will cause further unnecessary inactivity. Separately to the Supply Licence Conditions, BEIS should clarify that in activating the NRO;
- Suppliers can continue to offer their non-microbusiness customers a choice between an Advanced or a Smart meter when replacing a meter or making a new connection in their estate
- It does not affect a consumer’s ability to reject the offer of a Smart meter
- Current Transformer electricity meters will always require an Advanced meter
- It does not apply to the existing HH market
We believe BEIS should make two further exceptions to the NRO to allow suppliers to maintain roll-out momentum
Where a micro business customer has had an Advanced meter installed under the AME, their supplier should be able to offer a choice of replacement metering; Smart or Advanced.
These consumers are already getting equivalent benefits to SMETS2 with accurate bills, access to granular data, faster switching and interoperability. As currently written, the NRO would only permit the supplier to offer a Smart meter as a replacement, which if rejected would mean the customer loses these benefits.
Clearly, this should be avoided. If adopted, this approach would also provide greater resilience for the non-domestic roll-out by utilising a separate and independent supply chain to the domestic SMETS2 roll-out.
Additionally, suppliers should also be able to offer all microbusiness customers with a Traditional meter installed a choice between a Smart or Advanced meter in the roll-out, rather than limiting this option to non-microbusinesses.
Asking these consumers to make a choice in metering is a fundamental way of getting them to engage in the energy market as well as their energy usage, which is a primary concern for BEIS currently , and would drive the roll-out and its long-term consumer benefits better than the singular choice presented by the NRO.
Again, an established and robust supply chain for Advanced metering is already in place to service this sector and can be utilised to maintain momentum in the non-domestic roll-out.