The pros and cons of smart meters: Are they any good?

Hands holding a home smart meter against a sunlit background

(Image credit: Olga Dobrovolska via Getty Images)

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Pros of smart meters
Cons of smart meters

Installing a smart meter could help you pay less for your energy, but not everyone is convinced by the technology.

While gas and electricity prices today are far below their peak during the 2022 crisis, energy bills remain much higher than they were before the pandemic.

Under the current Ofgem energy price cap, the average household pays £1,758 annually for their energy, assuming they are on a variable two-fuel tariff and they pay by direct debit. The cap is in effect until the end of March.

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The current price cap is marginally higher than the previous quarter’s cap by a marginal 28p a month (up 0.2%).

Smart meter pros and cons

If you currently have a regular meter, we explore whether you should make the switch to smart meters.

The pros of smart meters

It make your bills more accurate

One of the biggest benefits of a smart meter is that it could help make your bills more accurate. Smart meters send readings to your supplier on a daily or half-hourly basis, depending on what sort of deal you opt for.

This means that both you and your supplier will be able to calculate your energy usage as accurately as possible and make sure you only pay for what you use.

If you do not have a meter and do not send regular readings, your supplier will estimate your bills. This could mean you end up paying more or less than you need to and having to make up the difference later on.

While you are able to get your money back if you can show you've overpaid, it may take weeks or even months to come through. You could also underpay with estimated bills, which might lead to you having to fork out a hefty sum in the future.

You won’t face this issue if you have a smart meter.

It can help you keep better track of your usage

Another useful benefit is the in-house display you'll get alongside your smart meter. This small monitor will show you your energy use to the penny.

The gadget can help you figure out how energy-hungry your appliances are and what chores are costing you the most. It means you can shift your energy use to off-peak hours (typically weekends, working hours and overnight), and be greener, while cutting costs.

You do not need to send readings manually

Perhaps the simplest advantage of getting a smart meter is that the hassle of sending monthly meter readings is eliminated.

Often, energy meters can be located in hard-to-access areas of your home, meaning it can be difficult to send a meter reading. As a smart meter gets this information automatically you will no longer need to worry about sending readings manually.

When significant alterations to the Ofgem energy price cap occur, you won't have to send readings ahead of the changes to unit rates. It is still good practice to do so, as it will ensure you do not pay over the odds for your energy.

You may gain access to some better deals

As smart meters make it much easier for both you and your energy supplier to track your usage, they can open the door for you to get some types of tariffs that require more regular meter readings.

For example, if you own an electric vehicle, you will most likely need to have a smart meter that sends half-hourly readings to make the most of the off-peak rates in an EV tariff.

The cons of smart meters

The government had been aiming to offer a smart meter to every home by mid-2025.

However, the latest figures released by the Department for Energy Security and Net Zero (DESNZ) on 27 November 2025 showed 30% of homes were yet to have one fitted by the end of September 2025.

In total, more than 40 million households in Britain now have a smart meter.

That's not to say all homes want one fitted. Some people have refused to get a smart meter due to concerns about the amount of insight they give energy suppliers.

Your smart meter could malfunction

For households with a smart meter, the biggest issue comes when the meter malfunctions.

Common issues include suppliers not receiving readings, the meters not displaying information to consumers, or both. Some have not been working because they haven't been commissioned properly at the point of installation.

Many first-generation smart meters also cannot properly connect to the centralised infrastructure that suppliers use to get readings. If you have a first-generation meter, you will need to get a new one installed.

Can you get compensation if your smart meter is faulty?

While Ofgem says 90% of the smart meters in Britain work as intended, errors and faults can occur. Since 2024, it has seen over 900,000 faulty smart meters repaired or replaced.

From February 2026 onwards, UK consumers will be able to claim compensation if something goes wrong with their smart meter.

Customers will be able to receive an automatic £40 compensation payment if:

They report a problem with their smart meter, but the supplier does not provide a resolution plan within five working days of the report
They have to wait more than six weeks for a smart meter installation appointment
A smart meter installation fails due to a supplier fault

The new rules mean that for the first time, people with faulty smart meters will be able to get compensation.

Melissa Giordano, deputy director of systems and processes at Ofgem said: “Smart meters offer customers accurate bills, cheaper tariffs, and real-time energy use tracking.

“Every customer who wants a smart meter should get one quickly, and it should work from day one. These new rules will set clear expectations of suppliers, drive better performance, and protect consumers when things go wrong.”

The rules will be reviewed in early 2027 to ensure they work for consumers.

Ofgem has also said it also wants to extend compensation to customers whose smart meters do not operate in smart mode and remain unfixed after 90 days. The regulator says it intends to bring these measures forward later this year, subject to consultation.

Are smart meters compulsory?

Smart meters are not compulsory. You are not legally required to have one installed, so if your energy supplier offers you one, you can refuse. However, this might limit your access to energy tariffs, including cheaper time-of-use tariffs.

Do smart meters cost more?

Installing a smart meter will not make your energy cost more. The unit rate you pay for your energy will remain the same after you get a smart meter.

Consumers don’t normally have to pay to get a smart meter installed.

Smart meters allow you to better understand how much energy you’re using. Getting a smart meter won’t automatically lower your bills, but households with one are more likely to access some of the cheapest deals on the energy market.

For example, if you have enough flexibility to be able to shift your energy use to off-peak times of the day, you could reduce your bills. But the type of energy deal that allows you to access these cheaper rates requires a smart meter because it tracks wholesale prices on a half-hourly basis.

So, from a price perspective, it makes sense to opt for a smart meter. However, they may not be easy to install in certain homes – especially older properties. If you live in such a household, it may be best to stick with your existing meter.

Are energy bills falling?

Energy prices have soared in the past three years, but have started to come back down, though they are still much higher than pre-pandemic averages.

The price cap rose by 0.2% in the first quarter of 2026, but it is expected to fall in the second quarter.

Cornwall Insight, which is well-regarded for the accuracy of its price cap predictions, now forecasts the April price cap to be £1,620 per year for a typical dual fuel consumer, down £138 from the January cap.

The prices are expected to fall mostly because of the government’s announcement that they will cut some eco levies from household energy bills, anticipating that this will save Brits around £150 a year.

These predictions should be taken with a pinch of salt, though, as it is incredibly difficult to predict energy prices so far in the future.

For more information on the future of the energy market, read our article on whether energy prices will go down.

Daniel is a financial journalist at MoneyWeek, writing about personal finance, economics, property, politics, and investing.

He covers savings, political news and enjoys translating economic data into simple English, and explaining what it means for your wallet.

Daniel joined MoneyWeek in January 2025. He previously worked at The Economist in their Audience team and read history at Emmanuel College, Cambridge, specialising in the history of political thought.

In his free time, he likes reading, walking around Hampstead Heath, and cooking overambitious meals.