News

The regulator has appointed DCC2 Ltd, a wholly owned subsidiary of the Smart Energy Code Company (SECCo), as the Successor Licensee that will hold the new Smart Meter Communication Licence when it comes into effect in March 2026.

A New Governance Era for Smart Metering

The appointment of DCC2 marks a significant step in the transition to a reformed governance and regulatory framework for the national smart metering system. According to Ofgem, DCC2 will operate on a not‑for‑profit, purpose‑driven basis and will be responsible for implementing key reforms arising from the DCC review programme. These include:

• Transition to majority independent governance,
• Introduction of an ex‑ante cost control model, and
• Production of a long‑term business strategy and technology roadmap.

These changes aim to ensure that the smart metering communications network continues to deliver value for consumers, strengthens regulatory oversight, and enhances long‑term system resilience.

A Competitive Selection Process

The decision follows a structured tender process launched after Ofgem’s Expression of Interest in March 2025. Key stages included:

• March 2025 – Expression of interest and initial questionnaire
• July 2025 – Publication of evaluation criteria
• 8 September – 6 October 2025 – Open qualification stage
• 5 November 2025 – 12 January 2026 – Closed proposal phase for qualified bidders
• 9 February 2026 – Final selection of the successor licensee 

Ofgem confirmed the process was conducted in line with the Smart Meter Communication Licence Tender Regulations (SI 2012/2414). 

Industry Reaction

In response to the announcement, Smart DCC—the current operator of the national smart meter communications infrastructure—welcomed Ofgem’s decision. The organisation highlighted that the selection of SECCo’s subsidiary does not alter DCC’s operational responsibility for running the national smart meter network during the transition. Instead, both organisations will begin joint preparations for a handover expected to complete in November 2026.

DCC CEO Chris Lovatt described the announcement as “an important step in the process towards our new regulatory framework,” noting that the transition is designed to ensure continuity of service, independent governance, and maximum consumer value.

Looking Ahead

Ofgem plans to publish the final version of the new SMCL and bring it into legal effect in March 2026, marking the official start of the transition to DCC2 as licensee. 

This decision represents a major evolution in the UK’s smart metering landscape—one that aims to strengthen accountability, reduce costs, and ensure that energy data communications continue to support a modern, flexible, and consumer‑focused energy system.

Elexon has officially confirmed that over one million electricity meters have now transitioned into Market-wide Half-Hourly Settlement (MHHS)—a major milestone in the ongoing reform of the GB electricity market.

Key Points

• 80% of all GB meters (approx. 25.9 million) are expected to be settled half-hourly by October 2026, making 2026 a pivotal year in the rollout.
• The shift enables suppliers to use actual half-hourly consumption data, helping them create more flexible, time‑of‑use tariffs.
• These tariffs can support:
  • Smart EV charging that automatically charges at optimal times.
  • Consumer participation in demand balancing by exporting power at remunerated rates.
• Settlement Accuracy Improvements: More actual data (vs estimates) is already being used, improving billing precision and system efficiency.
• Smart Data Repository:
  Launching in autumn 2026, it will publish aggregated half-hourly data, enabling innovators to develop new products and flexibility services accessible to all market participants.
• Next Steps for Industry:
  More than 100 companies still need to complete qualification to operate in the new MHHS arrangements, and Elexon’s focus is on supporting a smooth transition.

More than one million meters transferred to half-hourly settlement – Elexon

This joint blog from Ofgem and the Energy Ombudsman explains how artificial intelligence (AI) is increasingly used across the energy sector in Great Britain and what it means for consumers.

1. How AI is being used in the energy sector

AI is already shaping how energy companies operate and how customers experience energy services:

• Smart meters use AI to track energy usage and help tailor tariffs and billing.
• Customer service is increasingly supported by chatbots, automated email systems, and virtual assistants.
• System management: AI helps energy companies analyse large datasets, balance supply and demand, predict faults, and run networks more efficiently.

2. Benefits for consumers

AI can:

• Improve service efficiency and reliability
• Provide more personalised plans
• Detect issues early across the energy system
• Support customers who may need extra help by identifying signs of vulnerability

3. Risks and challenges

Ofgem highlights several risks if AI is not used responsibly:

• Bias and unfair outcomes if AI systems are trained on incomplete or skewed data
• Digital exclusion for people unable or unwilling to use digital tools
• Lack of transparency, e.g., consumers not realising they are interacting with AI

4. What Ofgem expects from energy companies

Ofgem requires that energy companies:

• Use AI fairly, transparently, and responsibly
• Protect consumers, especially vulnerable groups
• Ensure AI-driven decisions do not unfairly impact customers
• Provide clear routes for dispute resolution (supported by the Energy Ombudsman)
  
  

Key Changes

• Automatic £40 Compensation will be paid when:
  • Installation appointments take longer than six weeks to be offered.
  • An installation appointment fails due to supplier fault.
  • A customer reports a smart meter issue and the supplier fails to provide a resolution plan within five working days.
    
    

Why These Rules Are Being Introduced

• Ofgem has reviewed its Guaranteed Standards of Performance, aiming to raise industry accountability and ensure customers receive timely support. 
• The regulator’s compliance efforts since 2024 have already led to 900,000+ faulty smart meters being repaired or replaced, and the new rules are intended to accelerate this progress. 

What This Means for Consumers

• Faster installation and repair times.
• Clearer expectations of supplier performance.
• Stronger protections when issues arise.
• A push toward ensuring smart meters operate correctly from day one.
  
  

Looking Ahead

• Ofgem also plans further action on compensation for smart meters not working in smart mode for over 90 days, aiming to introduce this later in 2026.