Why we need a smart energy system

The UK has committed to becoming carbon neutral by 2050. But to achieve our ambitious climate targets, we need to change our energy system radically. We need a smarter and more flexible system to supply more renewable, efficient and low-carbon energy to households, and help us all to manage our valuable natural resources more efficiently. It’s called a smart energy system — and the 14.9 million smart meters we are having installed in our homes are playing an integral role in making it a reality.

Why upgrade?

Our current energy system can’t accurately map the demand from homes and smaller businesses and, as a result, a lot of energy goes to waste between the point of generation and supply to the customer. On top of this, the system is not always able to meet demand in the most efficient or environmentally friendly way — i.e. we rely on burning fossil fuels in times of low renewable supply.

While the current system is coping, it’s becoming increasingly clear that we need a more flexible and agile structure that wastes less and can make the most of renewable sources. And with more of us looking to switch to electric cars and heat pumps in coming years, the demand for clean electricity grows even bigger.

What is a smart system?

A smart energy system uses digital technology to monitor exactly how much energy the country is using and when — thus allowing network operators to understand exactly how much energy is needed, so demand can be met in the most efficient, cost-effective and sustainable way possible.

A key component of the system is smart meters — the digital energy meters which are being installed in homes and microbusinesses across Britain. They gather information on how much energy we as a country are using and when.

Flexibility

Unlike our current system, the smart energy infrastructure is fully digital, and its usage of near real-time data means a much more accurate understanding of energy usage.

The network can use this information to flexibly balance our energy supply with our needs using battery storage and innovative time-of-use energy tariffs. These will cost less when renewable supply is high, encouraging people to shift their use of high energy devices (for example, electric car chargers) to times when there is less demand on the system.

This will help the country to reduce energy wastage on a national scale, adding to the existing savings that smart meters already deliver to individual households through reducing consumption.

Crucially, the smart energy infrastructure will also make it easier to incorporate as much green energy as possible into the system. With more flexibility and greater storage, we can make much better use of wind and solar.

Innovation

This is just the beginning of a transformation of the way we use energy. It is anticipated that the smart energy system will drive innovations throughout the energy services market, transforming the way that energy is bought and sold.

There are trials in progress, for example, of outcome-based services rather than pay-per-use energy tariffs. Customers will be able to choose an outcome (for example, a fully charged electric car, or a warm home) and it will be up to providers to make this happen in the cheapest and greenest way. Again, the data to enable these innovations will come from your smart meter.

Make it happen

The smart revolution is happening in Britain, bringing reliable, efficient and low-carbon energy and providing the physical and data infrastructure for a new economic era.

But realising this vision begins in the home. By upgrading to a smart meter, we’re helping build a smarter Britain — delivering a cleaner, greener and smarter energy system better equipped for the future.

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