New Zealand's environmental watchdog has warned that the 1.3 million household smart meters to be installed nationwide by 2012 will not be smart enough to deliver expected cuts in energy use.
Parliamentary commissioner for the environment, Jan Wright, said that she has "heard mutterings that the smart meters being installed in New Zealand are actually 'dumb meters'", adding that the new meters lacked the functionality required to underpin a truly "smart" electricity grid.
Power companies are in the process of replacing 800,000 outdated household electricity meters with newer models that would enable utility firms to obtain meter readings remotely. However, as there are no guidelines for the standard of the meters, different companies are installing varying types.
In a report presented to New Zealand parliament last week, Wright said that many of the new meters lacked basic real-time monitoring functions that would provide consumers with an incentive to curb energy use at peak times.
The devices also lack a microchip that would enable meters to "talk" to smart appliances, which are not yet available in the country.
Advocates of the technology argue that this ability to automatically turn off smart appliances at times of peak energy demand is one of the main environmental benefits of smart-grid projects.
Wright warned that without the necessary microchip, there would be little incentive to sell smart appliances in New Zealand.
The report also warned that retrofitting the real-time reporting and smart appliance functionality at a later date would cost at least an additional NZ$60m (£23.5m).
Green Party co-leader Jeanette Fitzsimons accused power companies of installing 150,000 smart meters "with only half a brain" and the intention to install a further 650,000 "served nobody's interests but their own".
Wright's report noted that the rollout of smart electricity meters in New Zealand, unlike other countries, is being done without government oversight. " Regulatory intervention is needed to ensure environmental and consumer benefits can be delivered," she said.
Domestic power companies have defended their meters, saying that state regulation is unnecessary. Jason Delamore, general manager of retail at power firm Contact Energy, told the New Zealand Press Association that the utility had looked at a range of smart meters available in the international market to ensure the right choice was made.
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