What if every pound you spent on energy could tell you why it left your account — which appliance asked for it, at what time it was used or if the expense was just waste while no one was watching?
Most companies couldn’t answer these questions. They just pay their bill, negotiate a cost per kilowatt and forget about it — none the wiser about common, everyday waste that slowly eats away at profits.
Smart meters were invented to tackle this. Not as the fancy bits of technology we think of them, but as translating tools — changing invisible consumption to a language that can finally be understood by your business. In some company’s cases, the translation has revealed £1,000s of avoidable waste, in others, it has marked them out as already very efficient.
This isn’t a story about technology for the sake of having technology. It’s about whether knowing more can actually mean you can spend less, and what really businesses in the UK found after installing smart meters.
It is useful to understand what is “smart” about the devices before figuring potential savings. A smart meter is an electronic energy monitor that electronically ‘reads’ and sends your gas or electricity usage to your supplier. Smart meters replace estimates and manual meter readings with precise data that always reflects your real-time consumption.
There are two basic types:
• SMETS1 meters – the initial versions that do not usually work as well if you change suppliers; and
• SMETS2 meters – the current version with industry upgrades that work, regardless of who supplies your energy.
Large sites, leased buildings, or energy-intensive operations may use Advanced Meter Reading (AMR) or sub-metering instead. AMR systems generally provide data more frequently, and meter readings can be used with other energy management software for businesses to have further control over usage growth patterns and where the costs are allocated.
It’s not the smart meter itself that is valuable. It’s that because of the information obtained from the meter, you can make the necessary decisions. Here are how those insights translate into measurable financial benefit.
Every estimated bill has an inherent unknown internal risk — are you overpaying or underpaying? Smart meters eliminate that risk. You are only paying for what you use, at the time you use it. For small and medium businesses, that accuracy by itself can easily save hundreds of pounds in annual bills.
Data from smart meters provides immediate visibility of energy use patterns that can go unnoticed in operational daily practice. These behaviors can include lights continuing to burn after-hours, machines idling during lunch breaks and air-conditioning running in empty rooms. Many organisations find they achieve 2-5% reduced usage at no expense for equipment changes, simply acting on smart meter insights.
With half-hourly consumption data, suppliers and consultants can develop more precise tariff structures. Organisations with load-profile data can negotiate much more efficiently on flexible rates, time-of-use rates, and can time energy intensive processes to off-peak periods. In energy procurement, knowledge equals power.
Companies with carbon emissions tracking programs, or ones targeting net-zero carbon emissions, can leverage the time-stamped, reliable data from smart meters to produce sustainability reports and compliance submissions. Smart meters automatically feed into ISO 50001 energy-management systems and corporate ESG frameworks.
Smart meters indeed hold much promise for the future, but they are not without their downsides. Recognising them sooner rather than later can help businesses set an appropriate baseline.
Some of the early SMETS1 meters were not able to properly communicate after supplier changes. Most have since been migrated onto the national network of communication, but many meters will still lose their communication capability in locations that cover great distances or in areas of high interference (especially on industrial sites).
Smart-meter readings are just numbers — not opportunities. Without supporting dashboards or reporting you may not even view the data. Only when someone is interpreting the patterns and making decisions can real savings and opportunities result.
Large premises or multiple building estates will often need sub-metering if they wish to have a view of specific departments or tenants. A single main smart meter will just show total usage and is not the best way to get detailed insights across several departments.
For small businesses, installation is usually free, but complex commercial premises may need bespoke meters or integrated software, and there may be a charge. Some businesses are also concerned with how suppliers store and use consumption data. In the UK, protections are in place for this type of data, but it is worth checking the rights to use the data before signing up.
Government and industry statistics indicate that more than two-thirds of commercial meters throughout Great Britain are already smart or advanced meters. The ramp-up in adoption among multi-site retailers, hospitality chains, and manufacturing SMEs is among the highest.
Latest reports from the Department for Energy Security and Net Zero indicate that businesses that review their energy consumption data regularly are achieving average energy reductions of 3-5% to those who have smart meters installed and ignore the readings, which show almost zero change.
As two contrasting examples illustrate:
• A hotel in the Midlands used smart meters on its main supply and laundry area. The data pointed to heavy overnight demand from the water heaters. After reprogramming the timers, the hotel saw a reduction in costs of about £4,200 a year – a 6% reduction in electricity costs
• A London retailer monitored its smart meter data and found that it was using very little energy at night. This didn’t decrease consumption further from their already lean revising but provided assurance of operational efficiency, which justified sustainability claims to landlords and investors.
Bottom line: smart meters don’t save energy – but they show you where the energy savings are.
Smart meters provide operational benefits beyond pounds and pence that nevertheless, make business life easier:
• Early fault detection: Sudden spikes in consumption, if they occur, are often the first sign that something isn’t right with the equipment. If you act quickly enough you can avoid the costs of not having equipment working.
• Better financial forecasting: Access to real-time data helps budget accuracy and avoids the surprise bills of seasonal swings in demand.
• Centralised and simpler multi-site management: Management can see energy data from all locations in one spot and use this to benchmark efficiency across the business.
• Time savings for the finance team: No longer needing to chase manual meter readings or compare estimated invoices.
In some competitive industries, these process benefits are worth just as much as direct energy savings.
Installing a smart meter is the easy part. Making that stream of numbers translate into lower bills is where analysis and strategy come in. That’s where professional energy consultants (such as E for Energy) can make the difference.
An experienced partner can:
• Compare SMETS, AMR, and sub-metering options for your property type.
• Analyse consumption data to shed light on inefficiencies.
• Benchmark usage to compare to similar businesses.
• Recommend operational changes or tariff options that align with your real demand.
When technology and expert insight are used together, businesses generally achieve double-digit savings in the first year, not just from reduced use, but from smarter procurement as well.
A smart meter will not reduce your bills by itself. It’s a mirror, and not a magic wand – one that shows exactly when and where your energy pounds are going. The companies that achieve the most are not necessarily the biggest users of energy; they are the companies that are looking at the smart-meter data and doing something with it.
When energy markets are volatile, visibility is power. If you are a single office or a national portfolio, a smart meter offers insight to plan, optimise and negotiate. Everything else is very personal – or will come down to the honing of the right analytics to turn your numbers into strategy.
If you’d like to know what your energy bill has been trying to tell you, book a smart-meter assessment or energy audit with E for Energy, and start turning insights into savings.