The Department of Energy and Climate Change (DECC) has unveiled the “preferred bidders” to deliver its smart meter roll-out contracts, subject to final clearance, as an influential committee of MPs warned that the government needs to do more to enable smaller businesses to benefit from the scheme.
Five companies have been named as the preferred bidders of the contracts. Capita PLC is in line for the 12 year, £174 million DCC license, contracting and managing data and communications service providers, while CGI IT is set to be awarded the eight-year £75 million data service provider contract to develop and operate the system controlling the movement of messages to and from smart meters.
Communications service provider contracts are likely to be provided by Arqiva in the north of England and Scotland, and Telefonica in central and southern England and Wales. Gemserv has been selected as the preferred bidder for the smart energy code administrator and secretariat contract, which will maintain and update the industry code governing the the use of smart meters across the industry.
The companies have not been confirmed as winners yet, although it looks extremely likely that they will walk away with the prizes on offer. DECC said it would issue a statement to Parliament in early September, once contracts had been finalised.
The move is a step forward in the government’s smart meter programme, which suffered a set back earlier this year when it emerged that the scheme was to be delayed by 12 months, pushing back the final roll-out date to 2020.
The delay was due to the companies competing for the data service contracts calling for more time to design, build and test their programmes.
The announcement comes as the Select Committee on Energy and Climate Change, a panel of MPs tasked with scrutinising the government’s energy policy, warned that smaller businesses may need the same assistance offered to domestic users to make energy savings from the roll-out.
According to DECC, small businesses on dual fuel tariffs could save £164 a year as a result of the smart meter roll out.
But under the roll-out non-domestic customers will not be eligible for free “in-home displays” (IHDs) or free access to consumption and billing data which will be offered to domestic customers. DECC and Ofgem have both argued that there is “no business case” for offering this to non-domestic users, as many larger businesses have dedicated energy management teams.
However DECC has admitted that this is not the case for many small and micro-businesses.
The Committee said it saw “a fundamental incongruity in DECC and Ofgem’s position that on the one hand IHDs are integral to domestic consumers’ ability to reduce and manage energy consumption and should therefore be offered to them, but that on the other they need not be offered to small and micro-businesses.” The committee recommended that all of these services should be given free of charge to SMEs.
Lord Rupert Redesdale, CEO of the Energy Manager’s Association (EMA), welcomed the recommendation, but warned that an IHD would be no replacement for a dedicated energy manager. “It is a positive step that politicians are beginning to recognise that energy management should be ingrained at all levels of business and are extending support,” he said. “But a smart meter is only as effective as the person who interprets the data. We would hope that politicians would consider this when implanting any provision.”