The best way to pay for energy
28 Mar 2024
Smart meters give both you and your energy provider accurate and regular updates on how much electricity and gas you use.
They measure your energy use, like traditional gas and electricity meters, then automatically send it to your energy supplier.
Smart meters usually come with a smart meter monitor – a small display that shows how much energy you use in real time and how much it's costing.
You can often have an online account or app too where you can see your usage and spend. Knowing this should help you to better control your energy use.
Find out what to expect from a smart meter installation.
Smart meters use wireless networks, similar to mobile phone networks, to send usage data directly to your energy supplier. This means you won’t have to read your gas and electricity meters anymore, and your bills won’t be estimated.
If you have a smart meter, then your gas smart meter, electricity smart meter and smart meter monitor (also called an in-home display) talk to each other wirelessly through a communications hub.
Electricity smart meters are connected to the mains and monitor how much power you're using in real time. Gas smart meters are battery powered and 'asleep' for most of the time, waking up every half hour to produce a reading.
Your communications hub is usually attached to or part of your electricity smart meter. It allows your smart meters to communicate with your smart meter monitor using the smart meter home-area network.
It also talks to the wider Data Communications Company (DCC) network via the smart meter wide-area network to send energy-use data to your supplier.
You’ll get a different communications hub depending on where you live. In the south and central areas of Great Britain, hubs use cellular and wireless mesh technology to communicate with the DCC’s central network. Further north, they communicate via long-range radio.
There are also different technologies to connect your smart meter monitor to your communications hub. Most homes will get a standard, ‘single-band’ hub, which work in 70% of properties. If you’re not among these, you’ll most likely get a dual-band communications hub, as these will work in an additional 26-28% of homes.
The latest development is ‘alt HAN’ communications hubs, which will make communication possible in homes where gas and electricity meters are far apart or where there are particularly thick walls, as well as in high-rise flats and rural areas. These hubs will help the final 2-4% of homes. This should become available from July 2023, according to government.
Smart meters are different from energy monitors. While energy monitors can show you how much electricity you’re using, they don’t communicate this information to your provider.
Smart meters send meter readings to your energy supplier automatically. So you shouldn't need to take smart meter readings.
But if your smart meter stops working in smart mode, you’ll need to take manual meter readings again.
Some smart meter monitors show your meter readings. You’ll usually need to scroll through the different screens to find them.
You can also find your meter reading on your smart electricity meter and gas smart meter. Most smart meters have a button to illuminate the digital display so you can read the numbers.
Check the instructions your smart meter installer gave you if you’re not sure. Your energy supplier’s website may also have instructions. If not, ask your supplier for instructions.
If you have a traditional meter, find out how to read your gas meter or how to read your electricity meter.
If you pay as you go and have a smart meter, you won't need to go to the shop to top-up your meter. Instead, depending on your supplier, you can top-up using:
Your credit will often be added to your meter automatically.
You can also add your top-up manually via your smart meter. Some smart meter monitors can also be used to add your top-up.
You'll need the code from your receipt or payment confirmation. Exactly how you do this can vary by supplier and meter so check your supplier's website for instructions.
You can still top up at the shop if you want to. Some suppliers will send you a new top-up card with your smart meter.
Find out more about common concerns with getting a smart meter fitted.
Your smart meter monitor, energy company's website or app and tools from third parties can all help you get the most from the data your smart meter collects.
You should be offered a smart meter monitor (an in-home display) when you get your smart meter fitted.
This handheld device links to your smart meter and shows you how much gas and electricity you're using, and its cost. They usually also:
Some of the newest monitors can connect to your wi-fi so meter readings can be collected in real time and it's easier for your energy provider to update your monitor or diagnose any issues.
You can access the same information displayed by your smart meter monitor displays in your online account or app with many energy providers. Some firms have extra online or app features including showing how your electricity use is split by appliance type. Ovo Energy, Scottish Power and Utilita smart meter customers can get this. Utility Warehouse plans to roll this out soon.
Utilita's app also tracks your carbon footprint and gives a daily Smart Score based on how you use energy, with tips on how to be more efficient.
New energy-saving apps can see data from your smart meter if you give them permission. They work regardless of who your energy supplier is. These are some of the biggest (and free to download):
When you sign up to an app, you'll be asked to give your permission for it to access your smart meter data. You might also be asked for personal details such as your name, address and tariff details so it can make tailored recommendations.
There are two types of smart meter:
SMETS stands for Smart Metering Equipment Technical Specifications.
Energy companies have been installing second-generation smart meters for several years. These are automatically connected to the smart meter network so all energy firms should be able to operate them.
When energy suppliers began installing smart meters, they fitted first-generation smart meters. These work in the same way as more modern meters but a flaw means that they can lose their smart functions when you switch supplier.
Around 11 million of them have now been connected to the smart meter network where they should regain smart functions. That leaves four million to go. Of these, 500,000 may be impossible to connect. If you have one of these, your smart meter should be replaced.
Find out more about smart meter problems and how to solve them.
You don't have to accept a smart meter if you don’t want one.
Energy companies must take ‘all reasonable steps’ to install smart meters in their customers’ homes. This is set out in the conditions of their licences to supply gas and electricity.
Energy firms have annual installation targets, which are worked out by a formula devised by government. Companies that don’t meet their targets can face penalties, so they’re under pressure.
Energy companies also have to take ‘all reasonable steps’ to install smart meters where they’re replacing an old meter, or installing a meter for the first time (for example in a new-build home).
If one is being installed in your home but you're not interested in having a smart meter, ask your energy supplier if it can be set up in traditional mode, with all its communications turned off.
But if your energy firm has contacted you to change your meter because it needs replacing (ie it’s too old), then you should get it replaced as it could be a safety hazard if you don't.
Eventually all homes should be able to have smart meters. The government department for Energy, Security and Net Zero told us that smart meters should be able to work in 99% of homes from July 2023 thanks to new technology for smart meters in high-rise flats.
You may have been told you had to wait longer for a smart meter if:
These factors meant that your gas and electricity meters may struggle to communicate with each other, or with the communications hub that sends your energy-use data to your energy firm.
Contact your supplier to check whether it's now possible to fit a smart meter in your home.
Yes, if you rent your home, you can get a smart meter installed as long as you're paying the gas and electricity bills directly to the supplier.
If your landlord pays the energy bills, it's their decision whether to get smart meters.
Check your tenancy agreement if you’re not sure, as it might also restrict how energy is supplied to the property you're renting. This could include the type of meter that can be installed.
It’s a good idea to tell your landlord before you get a smart meter installed, even if your tenancy agreement doesn’t say you have to.
Find out more about getting a smart meter installed in a rented home
Automatic meter readings sent by your smart meter will mean more accurate bills for you. Your energy provider will save on the costs of sending out meter readings, which were paid for through your bills.
Companies are also expected to make savings from receiving fewer customers enquiries and making fewer home visits. In principle, they should pass on these savings to customers.
Right now, the financial benefits are most obvious if you have an electric vehicle (EV) that you charge at home.
Specially designed tariffs give cheapest charging rates overnight, or respond to price signals to charge your EV whenever it's cheapest.
Without an EV you might still be able to save money by being more energy efficient. Nesta's Behavioural Insights Team found that homes with smart meters reduced their electricity use by 3.3-3.6% and gas use by 2.9-3.1%.
But you'll only save in this way if you act on the information provided by your smart meter monitor to cut your consumption. It will also depend on how frugal you are already.
Follow our tips to become more energy efficient – see our expert advice on 10 ways to save on energy bills.
In the short term, smart meters are costing more on energy bills, as we all pay the costs of installation within our standing charges, whether you get one installed or not. The cost of smart meter installation to around £16 for an annual energy bill for a typical household from October 2022.
You do not need to pay anything upfront to have smart meters installed. There is no upfront cost for your smart meter monitor either.
But energy companies shouldn't tell you that smart meters are ‘free’, because ultimately you pay for them indirectly, through your energy bills. This is how traditional gas and electricity meters are paid for too.
No. You don’t need wi-fi or a broadband connection in your home to have smart meters.
Inside your home your smart meters communicate via a home area network, created by the communications hub installed with them. They use this to communicate with your smart meter monitor too.
Outside your home they communicate using a secure national wireless network used only by smart meters.
In this video, our experts cut through the conspiracy theories about smart meters. If you're concerned that smart meters could be a risk to your health, your privacy or your bills, discover whether or not you really have anything to fear.
Yes, smart meters work if you prepay for your gas and electricity. You should be able to see how much credit you have left on your smart meter monitor or using your energy company’s app.
You’ll be able to top up without going to the shop with many energy firms, via an app, text, over the phone or in your online account.
If you top up at a store, credit is automatically added to your meter without needing to insert your key or card.
If you want to change how you pay, for example to credit, you won’t need to get a new meter fitted. Smart meters can be switched between prepay and credit mode remotely.
Some prepayment smart meter monitors can:
Find out whether a prepayment meter is right for you.
Smart meters record your gas and electricity use. They don’t store or transmit personal information that could identify you, such as your name, address or bank details. Your energy supplier will still have these on your account but they're not in or connected to your smart meter.
The gas and electricity meter readings that your smart meter collects are shared with your energy supplier so they can bill you accurately.
Information about your energy use is your data, so you can choose what you want to do with it – and change your mind about how much you share, and how often. The only exception is when your energy data is required for billing or other regulated purposes (such as responding to customer questions, registering a prepayment meter top-up or investigating theft, for example).
You can choose:
Yes. Having a smart meter does not stop you from switching supplier.
There have been many reports of smart meters losing their smart functionality after switching supplier. They still measure your energy use but you have to take meter readings and send them to your supplier. Your smart meter monitor might stop showing your energy costs too.
This issue affected first-generation smart meters installed several years ago.
Energy firms have been installing second generation meters recently which are not affected.
Smart meters should make it quicker to switch suppliers as they can send information to a new supplier about your energy use instantly.
Find out what to do if your smart meter stops working and other smart meter problems and how to solve them.