Chinese smart meters could be a threat to power supplies critics fear

2022-10-16

Chinese smart meters could be a threat to power supplies in Britain if used as ‘a Trojan horse that could pull down the whole of the grid’, experts warn

Thousands of smart meters installed in UK have links to Chinese Government
Three major UK energy supplies have struck a deal with Kaifa Technology UK
There are already 250,000 Kaifa meters installed in homes across the country
Experts fear Beijing could ‘destroy’ the national grid because of the rollout

A quarter of a million smart meters made by a firm linked to the Chinese government have been installed in UK homes, sparking fears Beijing could ‘destroy’ the national grid.

At least three major UK energy suppliers have struck deals with Kaifa Technology UK, which is controlled by a subsidiary of the state-owned China Electronics Corporation (CEC).

There are already 250,000 Kaifa meters in homes across the country, according to industry figures obtained by the Daily Mail.

But experts predict there could be more than three million by the end of the rollout.

It has sparked accusations that penny-pinching energy firms are ignoring ‘a Trojan horse that could pull down the whole of the grid’ as they source cheaper meters.

Tory MP Sir Iain Duncan Smith, co-chairman of the Inter-Parliamentary Alliance on China, slammed ministers for their ‘complacency in assessing the risk posed by Chinese state-owned companies’ and exposing Britain to ‘the security risk posed by an aggressive’ Beijing.

How our supply could go off with a flick of a switch

All smart meters in the UK are fitted with a remote controlled off switch.

This is not essential to their functioning, but utility companies argue it saves them money if they don’t have to send a bailiff to disconnect a house should it default on bills.

But the measure has sparked security concerns.

If the switches were used to turn off a significant proportion of meters in tandem, the national grid would be generating far more energy than was being used.

This would trigger a surge and damage substations, leaving entire cities without power.

It comes after the head of GCHQ warned that China’s plans for global technological dominance posed a ‘huge threat to us all’.

Sir Jeremy Fleming said China was seeking to create ‘client economies and governments’ by selling technology cheaply to other countries in order to leverage influence.

The UK Government has ordered telecoms equipment from Chinese tech giant Huawei to be stripped out of the UK’s 5G network.

But Nick Hunn, a director at WiFore Consulting, who gave evidence to a parliamentary inquiry on smart meters, warned that Kaifa could represent a greater threat.

He said this was because all meters featured a switch that can be used to remotely turn off power, potentially blacking out homes and ‘destroying’ the national grid.

Energy suppliers say meter manufacturers cannot access this switch, but Mr Hunn said it ‘shows a frightening lack of complacency if they think the system can’t be hacked’, adding: ‘It is handing a loaded gun to China.’

The International Cyber Policy Centre has designated CEC as ‘very high risk’ due to its role as one of China’s leading producers of military electronics, while the US has blocked the use of Chinese smart meters.

But Octopus Energy hailed the installation of its 100,000th Kaifa meter this year by declaring it was ‘just the beginning’ of a ‘great partnership’. Ovo Energy has ordered 38,000 Kaifa meters for 2022 alone, while Eon has signed a four-year deal with the Chinese firm.

Multiple industry sources have told the Mail that Kaifa is winning around 20 per cent of contracts by undercutting European competitors by as much as 30 per cent.

They believe Kaifa’s strategy is to use the UK market to gain credibility before it ‘jacks up’ prices.

An Octopus spokesman said Kaifa meters constituted less than 4 per cent of its installations.

Both Energy UK and the Government stressed that all smart meters operating in Great Britain were subject to ‘robust security standards’.

Michael Wu, head of Kaifa UK, said the accusations were not ‘an honest reflection of our company’ and a result of an ‘adversarial political narrative’.

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