Smart meters 'may lead to an increase in fuel poverty'

Government plans to install a smart meter in every British household could force a "significant increase" in fuel poverty because the cost of the programme could far outweigh the savings, the Public Accounts Committee will warn today.

Some 53 million electricity and gas smart meters will be installed in British homes and small businesses between 2014 and 2019 to provide a live display of energy costs and consumption.

The Government says consumers will bear the estimated £240-per-household cost of installing them but will recoup most of their outlay – and many should make a profit – as greater scrutiny of their energy consumption brings down usage.

But the PAC's report doubts whether the smart meters will reduce energy consumption by much and says the installation costs will hit poorer consumers especially hard.

Margaret Hodge, who chairs the PAC, said the meters were a good idea in theory, but that the Government's proposals of how it will work are "both challenging and subject to significant uncertainty".