Millions of customers may be able to get compensation if their smart meter is faulty or installation is delayed in the future after Ofgem proposed new rules for energy suppliers.
Some households have faced difficulties with their smart meters since they were rolled out in 2011. Some smart meters have failed, while others have been unable to have them installed.
However, under proposed rules, consumers could be eligible for compensation in four new circumstances from next year.
Try 6 free issues of MoneyWeek today
Get unparalleled financial insight, analysis and expert opinion you can profit from.
Start your trial
Sign up for MoneyWeek’s free twice-daily newsletter.
Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.
Join more than 165,000 subscribers and keep yourself informed with latest financial news, insights and expert analysis to help you understand what really matters when it comes to your finances.
What are the four new rules which could mean customers get automatic compensation?
Ofgem has proposed four new rules which would mean affected customers automatically get compensation. These are:
Latest Videos FromMoneyWeek
- If a customer has to wait more than six weeks for a smart meter installation appointment
- In the event of a failed smart meter installation due to a fault within the supplier’s control
- If a customer reports a problem with their smart meter and the supplier does not provide a resolution plan within five working days
- If the smart meter doesn’t operate in smart mode and it’s not fixed within 90 days, including when this is because of connectivity issues
Ofgem says their compliance team has seen more than 600,000 faulty smart meters reconnected since last July and that the new rules will bolster their ability to make getting a smart meter quicker and easier.
The rules are part of a review of Ofgem’s Guaranteed Standards of Performance and will be consulted on, with key stakeholders being offered the opportunity to give feedback.
If the rules pass the consultation, the regulator aims to have the new smart meter standards in place from early 2026.
Charlotte Friel, director of retail pricing and systems at Ofgem, said: “Millions of consumers rely on their smart meter every day for accurate billing, cheaper tariffs, automatic meter readings and real-time data to help keep track of spending.
“But we know many customers that want a smart meter wait too long to get one installed or face delays on repairs when it stops working – this needs to change.”
She added that the new rules “are about setting clear expectations of suppliers, incentivising them to boost smart meter standards, and protecting consumers from poor service if things go wrong”.
The crackdown comes as Ofgem attempts to increase the rate at which smart meters are rolled out across Britain, as the government aims for 74.5% of homes to have one by the end of 2025.
Ofgem says that around 90% of the 39 million smart meters in the UK work as intended, but that still leaves around 3.9 million households stuck with a faulty meter.
What is a smart meter?
A smart meter is an energy meter that automatically takes readings at regular intervals and sends them to your energy supplier.
Around 67% of homes (39 million) had a smart meter by the end of March 2025, according to the latest data from the Department of Energy Security and Net Zero (DESNZ).
Smart meters can help you track your energy usage, meaning it can be easier for you to reduce your energy bills.
How will compensation be paid for a faulty or delayed smart meter?
If the new rules are implemented in early 2026, you could be in line for compensation if you’re affected by one of the aforementioned problems.
Under Ofgem’s current Guaranteed Standards of Performance (GSoP), consumers are entitled to a standard £40 of compensation if their supplier fails to: make and keep appointments, investigate and fix meter faults, or switch suppliers within five working days.
The proposed new rules for smart meters will be added to the GSoP, meaning suppliers would be required to pay the same level of compensation if you have trouble with your smart meter.
Ofgem has said any compensation that you are owed will be paid to you automatically by your supplier through the existing GSoP system.
Though the regulator says consumers will not have to apply for this compensation, it is probably a good idea to inform your energy supplier if you are having problems with your smart meter so you can get it fixed.
In the event that you do not receive compensation, or you believe that your energy supplier is acting in the wrong, you are able to contact the Energy Ombudsman.
