PARLIAMENTARY WRITTEN QUESTION
Energy: Meters (6 January 2015)

To ask the Secretary of State for Energy and Climate Change, what estimate he has made of the likely level of any extra funds the Date Communications Company may request before May 2015 regarding the smart meter roll-out.

Asked by:
Jonathan Reynolds (Labour)

In line with its licence requirements, the Data and Communications Company (DCC) published a draft Charging Statement in December 2014 for its service charges for the Regulatory Year ending 31 March 2016. This Charging Statement will be published in a form approved by Ofgem in accordance with the DCC’s Licence on 31 March 2015.

The draft Charging Statement notes that actual costs may vary owing to a number of uncertainties, one of which is the proposed changes to the DCC’s Plan and Implementation Milestones, consulted on by the DCC late last year. No decisions have been taken on this, and therefore the additional costs are not yet finalised. DCC’s consultation estimates the additional costs arising from the revised plan to be in the region of £60 million - £90 million. These costs would be recovered from the DCC’s service users over a number of years. The DCC is regulated by Ofgem, which conducts an ex post review of DCC’s costs to ensure that they are economically and efficiently incurred.

The procurement of the service providers for the GB-wide smart meters data and communication systems, completed in September 2013, was delivered £375 million below the estimated costs set out in our January 2013 Impact Assessment.

The latest Impact Assessment, published in January 2014, estimates the total costs of the Programme to be about £10.9 billion, with total benefits of about £17.1 billion, providing a strong business case for the roll-out with net benefits of £6 billion.

Answered by:
Amber Rudd (Independent)
15 January 2015