Why Do We Need Smart Meters?

Smart meters are the future of integrating technology into our daily energy management. Most people don't think about how much energy they consume on a daily basis but with the advance of smart meters, consumers will be able to monitor how much gas and electricity they are using and how much it is costing them in real time.

The question is: Do we really need smart meters? In the UK the government has pledged to get 26 million electricity meters and 22 million gas meters replaced with smart meters across the country by 2020, at an estimated cost of £7 billion. In the US, President Obama has called for 40 million smart meters to be installed, with 6 per cent of US citizens already using smart meters in their homes.

However, as the social commentator Peter Drucker said: "There is nothing quite so meaningless as doing well that which need not be done at all." The charge against smart meters is simple: why should we replace an existing technology which works perfectly well? As the old adage goes: if it ain't broke, don't fix it.

The problem is that our thinking on energy is broken and finding new ways to combat our constantly expanding demand for gas and electricity is necessary to solve the problem of decreasing fuel resources. Foundation Capital expects that by 2060, world energy consumption will double from 14 terawatts per day to 28 terawatts. Just finding another 14 terawatts is not a sustainable solution but changing energy consumption habits is one way to reduce the burden.

Smart meters are one way that people can start to reduce the amount of energy they consume on a daily basis. The electronic meters replace the current analogue meters with a digital display that can calculate exactly how much gas and electricity is being used at any given time of day. Smart meters allow consumers to track their energy consumption day by day, which means people will be able to watch how changing their habits has a direct impact on their utility usage.

A simple gesture - such as switching off appliances at the mains rather than leaving them on standby - will have a noticeable effect on the smart meter, which customers will be able to see for themselves. Smart meters put the power in the hands of consumers and allow them to mark their own progress as they move to reduce their energy consumption.