GB Smart Meter Roll-out Programme: Right time for starting the roll out

Government of UK has issued a mandate to all utility suppliers in the country to ensure that smart meter is fitted in the premises of all their domestic customer by 2020 or earlier(DECC,2010). The main reason for governing bodies impose regulations is to reduce harmful emissions and also secure energy resources for future. This initiative of installing smart meter in every household is also linked to strengthening UK governments’ commitment to achieve its set target in reducing energy usage while empowering consumer with clear information of their usage and thus make a conscious effort to use, only required amount of energy.(DECC, 2010) This initiative is expected to affect energy utility industry in many ways now and in future, first major implication of this initiative is launch of a nationwide meter replacement campaign where suppliers are expected to replace every electricity and gas meter with smart meter in all their domestic customer. Making a huge challenge to suppliers who not only need to adopt to new technology and include it in their process but also convince customer to actively take part in the campaign. Consultation and study carried out by government regulatory organizations like Ofgem and DECC has showed that major part of success in this initiative can be derived only when customer fully engages with the program hence the challenge is to educate the customer on smart meter. It also said to provide utility companies with an opportunity to engage consumers in a way that they not only retain their existing customers and may be win customers from competitors but also reap advantage learning from early experience and use it to gain long term profitability. In the light of above context E.ON UK like any other energy retailer in the utility industry is faced with challenge of responding to regulatory changes, demand fluctuations and price volatility and new competition. Hence it has to develop a customer engagement strategy for smart meter installation and also given the uncertainty and newness concept in domestic household market it is also important for company to of decide the timing of this launch. Through this report an attempt is made to study the environmental conditions around smart meter and more importantly so look at sector and consumer survey results to determine the best time of entry. Report will review the literature on first mover, second mover and fast second and also look at timing for adopting environmental regulation to assist in evaluating best strategy for E.ON UK to adopt in smart meter roll out