Cameron sets out smart grid vision

David Cameron will today lay out his vision for a low-carbon Britain, reiterating his commitment to scrap the expansion of Heathrow and outlining plans for a £1bn investment in an energy smart grid that will deliver a smart meter to every home.

The proposed smart grid would allow energy companies and grid operators to sell electricity much more efficiently by reducing the need to generate more electricity than is needed to cover peaks in demand.

Smart grid technologies would manage peaks in demand by automatically cutting electricity supply to non-essential items within a home, such as washing machines or other white goods. They would also allow customers with electric cars or micro-generation technologies such as solar panels to sell energy back to the grid at a premium during peak hours.

"In energy and electricity terms this is like going from analogue television to digital television where you have an enormous amount of choice and interactivity," Cameron said.

The government has already laid out plans to mandate smart meters, although it has not yet promised any state investment.

Cameron said his party had already held talks with the National Grid and would be in a position to approve the 10-year programme as soon as it came in to office.

The proposals mirror the plan set out by US president-elect Barack Obama who has pledged to make smart grid technologies one of the centrepieces of his multi-billion dollar infrastructure investment programme.

Cameron will also repeat his pledge to reverse the government's decision yesterday to grant approval to a third runway at Heathrow, and instead invest in a high-speed rail network connecting London to Manchester, Birmingham and Leeds.

The Conservatives are confident that work on the project will not be that advanced by the time of election, meaning that if elected they would not have to pay exorbitant levels of compensation to airport operator BAA when scrapping the planning permission.

Responding to plans, Garry Felgate, chief executive of the Energy Retail Association, which represents the six major gas and electricity suppliers in Great Britain, said:

"We wholeheartedly welcome this announcement from the Conservative party on smart meters. Smart meters are the cornerstone for energy saving within the home, as they will allow customers to see their actual energy usage at any time of day, for the first time."