Smart meters vulnerable to multi-million pound energy theft, ADI warns

Smart meters due to be rolled out to all UK homes from next year will be vulnerable to energy theft through magnetic tampering, resulting in multi-million pound losses for energy suppliers technology company Analog Devices Inc (ADI) has warned.

Ofgem data reveals that energy theft, of which magnetic theft ADI says “is one of the easiest methods of tampering”, resulted in a £400 million pound loss to energy suppliers in 2014.

This loss is passed onto consumers through their energy bills, meaning consumers will continue to pay for these “non-technical losses” which Ofgem says added £7.70 per home in 2014.

Ofgem says energy theft also leads to a “misallocation of costs amongst suppliers, which can distort effective competition and hamper the efficient functioning of the market.”

ADI says it is “currently in conversation” with meter manufacturers servicing the UK market to bring its cost-effective method of preventing magnetic tampering, an isolation chip, to the UK but currently there is no resistant technology present in the market.

UK regulation does not specifically require meters to be resistant to tampering by large magnets held near meters, although there are obligations on suppliers to detect and prevent cases of energy theft.

Suppliers can use sensors built into meters to detect magnetic tampering but these are costly.

ADI marketing manager Mark Strzegowski said: “There are these losses that these energy companies just don’t understand. There is a big push, especially in the European Union to try and reduce these technical losses.”

“It’s in the benefits of everyone to minimise cases of theft because we end up paying for it as a charge on all of our bills.”

While smart meters will not be resistant to energy theft, Strzegowski says the rollout is likely to reduce the number of theft cases due to the more frequent measurement of energy use revealing anomolies usually due to tampering.

But he says ADI believes energy theft is generally on the rise saying: “Some of it is due to economic conditions, as household and business economies get under more economic pressures there are obviously the incentives there.

“But the sharing of the availability of information on the internet is a problem. There is a particular Russian site that lists 50 different ways to tamper with your electricity meter.”