Some of the world’s biggest telecoms and technology companies have begun discussions to team up for a multi-billion-pound contract to run “smart meters” in Britain. Telecoms giants Vodafone, O2 and BT and system integrators Logica, Accenture, IBM and Capgemini are understood to have started talks to form bidding consortiums. The scheme envisages the installation of digital meters in every home to tell customers how much energy they are using. The government expects the scheme to revolutionise the energy industry and lead to lower consumption. The tender will be launched in the new year.

The discussions were kick-started after the government and industry agreed in recent weeks to a broad outline on how smart meters would be rolled out and how the reams of digital data they produce would be handled. The contract for this central data-handling function is expected to be worth several billion pounds. The scheme requires each of the country’s 26m homes to be fitted with new gas and electricity meters – 46m meters in all – which will allow customers to monitor their energy consumption on easy-to-use digital devices. These have been shown to reduce consumption and will put an end to estimated bills. The government has put smart meters at the heart of its energy policy but progress on its implemen-tation has been slow. A consensus has emerged recently between the Department for Energy and Climate Change, Ofgem, the regulator, and the big six utility companies over how it will be done.

Each utility will be responsible for fitting new meters for its customers, starting a roll-out from 2010. It is estimated this will cost about £7 billion, equivalent to about £15 per home per year. With reduced operating costs for utilities – which will be able to jettison their armies of meter readers – and lower consumption, this cost is expected to be more than offset by customer savings. To ensure transparency, a “central communications” group would be set up to electronically collect, process and distribute data and serve as the go-between for energy companies and the meters in their customers’ homes.

Ofgem is expected to run the tender for the contract, which would operate from 2010 to 2020. The winning group would likely consist of a telecoms provider and a systems integrator. There is an outside chance that the contract could be broken down regionally.

At a meeting tomorrow, the bosses of the big six companies are expected to press Ed Miliband, the energy secretary, to speed up the process if it is to meet the government’s stated goal of 2010.

A Centrica spokesman said: “Smart meters will really revolutionise the energy-supply industry, and should give the UK’s energy customers very significant benefits through cuts in energy usage and much better customer service.

“They will also provide a key element of encouraging more micro-generation in people’s homes.”

- Mobile-phone group Orange will this week announce plans to site a new research-and-development facility in Britain, with the creation of 80 jobs. Its Technocentre, run from London and Bristol, aims to develop new services for customers.

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