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Incorrect Billing of Customers with a Smart Meter

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KoRWraith
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I discovered something quite interesting when I switched my electricity from Octopus to EDF last year, as EDF offered a cheaper night time rate. When I was with Octopus, my off-peak usage accounted for ~97% of my bill. When I switched to EDF that dropped to ~92%. Any normal person might not have noticed, but given how sensitive my payback is to this peak/off-peak split I spotted it immediately.

I downloaded my 30-minute data from my smart meter and sure enough, I had been billed incorrectly. 

I contacted EDF with my findings and long story short EDF's dual rate tariffs don't use the half hourly data, instead they use two counters within the smart meter. One runs from 6am to 1am, the other from 1am to 6am (offset by an hour during winter). Through some experimentation I discovered that the counters don't switch over at these exact times, there seems to be a lag of maybe 10 minutes. Which means that I was being charged peak rate for the first few minutes of my EV & home battery charging every night. It added up to ~£50 a year difference in EDF's favour.

It took literally 38 emails back and forth to EDF before they finally confirmed the issue, they said they were planning to change their system to use the half hourly data in the 'near future', and offered me £50 to stop bugging them.

At this point it was more the principle than the money that bothered me, I told them £50 compensation for a 38 long email chain wasn't appropriate, especially where on multiple occasions they denied the existence of the problem. Additionally, presumably everyone else on an EDF dual rate tariff is also being overcharged and so I would expect them to offer compensation across the board to all affected customers until they fix the billing system. At this point they offered me £100.

I've referred the case on to the Energy Ombudsman for their consideration. I hope EDF's admission of a systematic billing issue may result in greater action from the Ombudsman but I've no idea if that's even within the remit of the department that my case sits with.

I also wonder if other energy companies are similarly using this 'counter' system for their dual rate tariffs rather than the 30-minute data, which would have repercussions for many more people than just EDF customers...

This topic was modified 1 month ago by Mars

   
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Mars
 Mars
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@korwraith that’s super interesting. This “minor” 10 minutes that adds up to £50 per year, multiplied by millions of customers is a tidy additional income, and something EDF customers should be aware of.

Why did you leave Octopus in favour of EDF?

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Toodles
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@editor Sounds as though EDF could show as cheaper as they have a 10 minute subsidy daily from every 2-rate tariff customer!!!😉 Toodles.

Toodles, 76 years young and hoping to see 100 and make some ROI on my renewable energy investment!


   
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KoRWraith
(@korwraith)
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@editor indeed - one suspects that if the metering error was in the customer's favour rather than EDF's favour they would have switched to the 30-minute readings some time ago! (although it should also be recognised that the vast majority of customers won't be on dual rate tariffs so most people are unaffected)

If memory serves, I was paying 10p/kWh off peak with Octopus and EDF's comparative tariff was 8p/kWh off peak (peak rates were similar enough between the two tariffs as to be net cheaper with EDF, I also had a £100 refer a friend offer with EDF). 


   
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Transparent
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We need to note that the Smart Meter itself is accurate and within spec, but the way in which its functionality is being used by an Energy Supplier is resulting in incorrect billing. That is a subtle, but important point.

Incorrect Billing is a breach of Licence Conditions, and results in hefty fines by Ofgem, the industry regulator. This is not a 'light matter'.

Taking the issue to the Office of the Energy Ombudsman will most likely result in an investigation of that particular account, a finding against EDF, and the requirement that they pay notional compensation of £50. To avoid further censure, that's why EDF have already offered that sum.

The issue of Incorrect Billing of customers who have ToU tariffs on Smart Meters has already been brought to the attention of the Commons Select Committee on Energy Security and Net Zero during autumn'23, although that evidence did not then consider the particular two counters which @korwraith has become aware of.

I will explain more (with graphs and diagrams) once we're in the new topic.

This post was modified 1 month ago by Mars

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Transparent
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Update. Someone needs to instigate an FOI request to DESNZ.
I've outlined the situation to Korwraith, but he feels unable to pursue that route.
That's quite understandable. He's already handled a 38 email dialogue with EDF and his application to the Ombudsman is still 'live'. 😫 

Does anyone else feel able to write to DESNZ?
They were communicating (privately) with Suppliers last autumn on the need to mitigate against risks of incorrect billing.
So it's reasonable for 'us' to now ask for those communications.
I can provide the relevant references and body text via DM.

For my part I'm going to pick up the loose ends with the Commons Select Committee because I've already got correspondence with them on the matter of incorrect billing.

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Mars
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@transparent I can kick up an "informal" fuss, by bringing this thread to the attention of EDF and its senior management. It's unlikely to lead to any resolutions though. Also happy to send a similar email to OFGEM if you think it'll help.

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Transparent
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@editor this is much bigger than you might at first suppose.

The issue doesn't just involve EDF.
And alerting Ofgem at this stage will likely cause email deletions.

The problem goes back to Ofgem having given permission to Energy Suppliers that they need not implement in its entirety the Smart Meter specification and regulations which Parliament approved in 2013/14. Partial implementation is at the heart of the Billing Errors.

Ofgem is a non-ministerial government department.
So who holds it to account?

What happens with the Suppliers that have already been required to pay £millions by way of fines and redress for previous breaches of their Licences?
Once they realise that Ofgem itself has presided over a number of different billing error issues, will they all be wanting their money back?

Remember I've already corresponded with MPs over this subject matter.
So @korwraith shouldn't have been able to detect any such error in 2024.

As the Forum Manager, I'd suggest you contact a couple of investigative journalism outlets, and alert them that there's about to be a major revelation here.

  • Private Eye?
  • Martin Lewis?

 

This post was modified 1 month ago 2 times by Transparent

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Transparent
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Here I'm starting the explanation of what @korwraith observed at the start of this topic:

Posted by: @korwraith

EDF's dual rate tariffs don't use the half hourly data, instead they use two counters within the smart meter. One runs from 6am to 1am, the other from 1am to 6am [...]. Through some experimentation I discovered that the counters don't switch over at these exact times, there seems to be a lag of maybe 10 minutes.

A Smart Meter system commonly consists of four devices

  • communications hub
  • electricity meter - more properly called the Electricity Smart Meter Equipment (ESME)
  • gas meter - GSME
  • In-Home Display - IHD

 

Here we're going to concentrate only only the first two of these, which are bolted together:

SMETS2 E2sm

Both the Comms Hub and the ESME are aware of Coordinated Universal Time (UTC), which is synchronised across the world by an atomic clock.
The Comms Hub sends UTC to the IHD, where it is displayed, amended by Daylight Saving Time as appropriate.

However, each ESME retains another clock which is offset (delayed) from UTC by a number of whole seconds between 1 - 1799.

The Randomised Offset is derived from two numbers

A: Randomised Offset Number, which is between 0 and 1 (but cannot be either 0 or 1). It is set in each ESME by the manufacturer using a random-seed, and cannot be changed.

B: Randomised Offset Limit; an integer between 1 and 1799 (inclusive). Set randomly at manufacture, but can be re-written by the Data Communications Company (DCC)

image

The Randomised Offset is used to define the delay between UTC and the start of the half-hour (HH) periods of the Tariff Switching Table which are used for Time-of-Use (ToU) tariffs.

♩  It is not possible for the delay to be Zero.
♩  No Smart Meter tariff periods can be precisely aligned with UTC.

As a result, there is a statistical probability of when your Smart Meter will commence the HH period.
Within a notional random set of 4000 meters, the probability of a particular delay applying to a given meter is presented thus:

image

Statistically, by the end of the 8th minute, half of the meters have still not switched onto the next tariff period.

The Randomised Offset is held within the secure envelope of the meter.
It is not possible for the consumer to read that information.
DESNZ have stated that the Randomised Offset can be seen by Energy Suppliers, but have presented no evidence to support that.

Customers on fixed-rate tariffs will probably be unaware of the 48 time-slots each day.

The issue matters only for those who use
• Economy-7, Smart EV Charger tariffs, or similar off-peak cheap-rate tariffs
• A flexible Time of Use (ToU) tariff, such as those currently offered by Octopus Energy

The 10-minute delay observed by @korwraith  is most likely due to the particular Randomised Offset within his ESME.

This post was modified 1 month ago 7 times by Transparent

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Transparent
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Part 2:

All consumers can see the 48 time-periods if they check their daily energy usage on the website of their Energy Supplier, or when using the matching App on a smartphone, eg:

image

For those using a standard fixed-rate tariff, each time-period is being billed at the same rate in p/kWh.

Customers who have selected Cheap-rate or ToU tariffs will have differing p/kWh rates throughout the day.
The following timeline shows three such Octopus tariffs over 3 days (144 half-hour periods)

image

 

The simplest of these three tariffs is Octopus Go.
It has a single cheap-rate timeslot of between 00:30 and 04:30 each night, which was set at 12p/kWh in the above example.

In practice, those times are delayed by each customer’s Smart Meter. The lower 12p rate will commence after a random delay beyond 00:30

Since the customer doesn’t know the delay applied by their Smart Meter, if they choose to switch on an appliance at 00:30, they will still be paying the higher 43p/kWh rate until the actual tariff time-period starts.

They are being over-charged.

They are unaware of this.

Consumers lack knowledge of the Randomised Tariff Offset

image

Above: Consumer using a manual switch-on for 30-minutes; Smart Meter with a Tariff Offset of 7mins 40 secs

 

The actual peak rate will vary according to the electricity Distribution Region of the country, even for customers who are on the same Octopus Go tariff

This post was modified 1 month ago by Transparent

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Transparent
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Part 3: The Smart EV Charger Problem

Energy Suppliers are aware of the Randomised Tariff Offset.

The delay on Smart Meter Switching Timetable is designed to ensure that the grid is not subjected to demand surges if devices were switched on simultaneously.

Under the The Electric Vehicles (Smart Charge Points) Regulations 2021, Section 11 stipulates another (different) time offset which should be used to avoid demand surges.
The 2021 law requires all chargers to be ‘Smart’. All approved chargers operate using Imposed Smartness, controlled by the Energy Supplier.

image

That means there are actually three clocks used by any Energy Supplier which offers a special rate for their customers'  EV Smart Chargers:

image

 

We cannot tell how each Energy Supplier has interpreted, nor implemented, the two delays stipulated in 11.1a (30 minutes) or 11.2a (10 minutes).
However, it is clear that:

  1. the delays required by the Electric Vehicles Charging Regulations are independent of the Randomised Offset to the Tariff Switching Table within the Smart Meter
  2. the ‘smart’ commands are sent using the internet, rather than the Smart Meter Wide Area Network (SMWAN)
  3. the ‘smart’ nature of the EV charger is defined by the ability of the Energy Supplier to issue on/off commands to it remotely
  4. the EV Charger itself contains no ability to operate ‘smartly’ in an autonomous fashion. If the customer operates it manually, then it has no smart functionality.

 

The ‘random’ delay required by these Charging Regulations will interact with the existing delay imposed by the Randomised Tariff Offset within the Smart Meter.
If we assume that the EV charger is delayed up to 10 minutes (600 seconds) by the Energy Supplier, then the probabilities can be shown as follows:

image

And if the Energy Supplier imposes a delay of up to 30 minutes (1800 secs), then the probability of delays to which the EV charger is subjected are these:

image

Where the Combined Offset of the two (independent) delays is positive, the amount billed for the electricity used by the EV charger is less than the customer’s tariff indicates.

However, where the Combined Offset is negative, then the customer is being billed for a higher amount than they should be. The Energy Supplier is over-charging.

If the Energy Supplier is sending a command to switch on an EV Charger of 10 minutes or less, then 57% of customers are paying too much.

If the delay for switching on the EV Charger is up to 30 minutes, then 25% of customers are being overcharged.

The following two histograms show only the probabilities associated with those customers being over-charged.

image

The algorithm used in the Smart Meter to calculate the Randomised Offset to the Tariff Switching Table is based on a random number which was fixed at the time of manufacture. Therefore the same customers are being consistently over-charged.

The Smart Meter specification (2014) prohibits the Randomised Offset from being accessed externally.
It is not possible to tell who these customers are without access granted by DCC.

image

 

At its heart, the problems of incorrect billing are a consequence of the regulator, Ofgem, allowing Energy Suppliers to partially implement the Smart Meter Specifications.

The Smart Meter is the bedrock on which the UK's future smart electricity supply system is to be built.

Allowing Licensed Suppliers to use the internet as an alternative route through which commands may be sent has undermined the very principles on which the security of our electricity supply is to be based.

Ofgem's failure to insist that all seven main functions of the SMETS2 specification be implemented has resulted in Suppliers omitting the functionality which would be most beneficial to their customers.

They are not even required to populate the  several Tariff matrices:

image

Instead, Energy Suppliers are retrieving consumption data per half-hour from the Smart Meter, and then retrospectively applying the customer's tariff pricing within their in-house billing system.

The Smart Meters are operating correctly and accurately.

The Billing Systems are a work of fiction, applying a thin veneer of procedures to make it appear that the terms of the Suppliers' Licences are being adhered to.

 

You may feel free to comment!

This post was modified 1 month ago by Transparent

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Mars
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Posted by: @transparent

As the Forum Manager, I'd suggest you contact a couple of investigative journalism outlets, and alert them that there's about to be a major revelation here.

  • Private Eye?
  • Martin Lewis?

Will do. Plan on taking it easy tomorrow, so will send out some emails.

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