The way energy companies and their customers measure their power consumption is to be changed forever thanks to the introduction of the Smart Meter. These advanced meter reading systems are to replace traditional gas, water and electricity meters by 2022, and could lead to savings for all of us.

The UK government has therefore decided that we will all have Smart Meters installed in our homes by 2020, so just what are these Smart Meters and what does this change mean for the everyday consumer?

1. Rather than just receiving one value every month or quarter from a standard gas or electric meter, you will now be able to receive energy consumption information at any time of day using your new Smart Meter, allowing you to better monitor your energy use.

2. The new meters allow the energy providers to keep tabs on your energy usage, so there will be no need to give them readings and there will be no need for them to estimate your readings any longer. This avoids any risk of overcharging, as so often happens with estimated bills.

3. As a result, energy companies will need to employ fewer staff: no more meter readers, and fewer call centre staff needed to deal with estimated bill complaints. This could well lead to energy price cuts across the board as companies pass savings onto their customers.

4. The Smart Meter is a giant leap forward in meter reading technology, allowing users to see up-to-the-minute information on their energy consumption, and how much this is costing, on a display screen fitted within their homes. Here users can compare their usage by day, week or month to see where they are using most energy and where they can make improvements.

5. The meters can be controlled remotely by the energy suppliers who can disconnect and reconnect power remotely, as well as monitor power quality, change the maximum amount of power supplied to a customer, and change meter billing plans at the touch of a button.

Smart Meters are just the first step required in transforming our energy supply system in readiness for the switch to renewable and alternative energy sources. The current meter system is simply not flexible enough to deal with supplies that may be sourced from a variety of power sources.