Smart Meters Explained: Pros, Cons, and Do You Need One?

Last updated: February 2026 | Smart meters are now in over 30 million UK homes. But are they worth it? We explain what they do, the real pros and cons, and whether you should get one.

Smart meters have become a hot topic in the UK. Energy suppliers push them constantly, but many people remain sceptical. Let’s cut through the marketing and look at what smart meters actually do — and whether they’re right for you.

What is a Smart Meter?

A smart meter automatically sends your gas and electricity readings to your energy supplier. No more estimated bills, no more manual readings, no more strangers coming to read your meter.

There are two key components:

The smart meter itself: Replaces your old gas and electricity meters. Installed on your wall, usually in the same location.
In-Home Display (IHD): A small screen that shows your energy use in real-time, in pounds and pence.

Important: A smart meter is not the same as a smart thermostat. Smart meters measure energy use. Smart thermostats control your heating. They’re separate systems.

Smart Meter Generations

SMETS1 (First Generation)

Early smart meters that often “went dumb” when you switched suppliers. Many have now been upgraded remotely to work properly.

SMETS2 (Second Generation)

Current standard since 2019. Works with any supplier when you switch. Uses a national network (DCC) so your data follows you.

If you’re getting a smart meter installed now, it will be SMETS2.

Pros of Smart Meters

1. Accurate Bills — No More Estimates

Your bills are based on actual usage, not estimates. No more surprise “catch-up” bills where you’ve underpaid for months.

2. See Your Usage in Real-Time

The In-Home Display shows exactly how much you’re spending. Many people find this helps them identify energy-hungry appliances and change habits.

3. Switch Suppliers Easily

Your new supplier gets accurate data immediately. No more waiting for meter readings or starting on estimates.

4. Required for Some Tariffs

Many of the best energy deals now require a smart meter:

Octopus Agile: Half-hourly pricing that can save money with smart usage
Octopus Go: Cheap overnight rates for EV charging
Economy-style tariffs: Often need smart meters for accurate time-of-use tracking

5. Better for Solar/Battery Owners

If you have solar panels or home batteries, smart meters track export accurately. Essential for selling electricity back to the grid.

6. Free Installation

Smart meters are supplied and installed free by your energy supplier. You pay nothing upfront.

Cons of Smart Meters

1. They Don’t Actually Save You Money

This is the big one. A smart meter measures energy — it doesn’t reduce it. You save money by changing behaviour. The meter just shows you the numbers.

Studies suggest average savings of 2-3% for those who actively use their IHD. Not as dramatic as suppliers imply.

2. Privacy Concerns

Smart meters record your usage in detail. Some people worry about:

Data being shared with third parties
Usage patterns revealing when you’re home
Future time-of-use pricing penalising certain usage times

In practice, you can limit data sharing. Half-hourly data requires your consent.

3. Installation Can Cause Issues

While rare, some installations cause problems:

Old wiring flagged as unsafe (requiring £££ to fix before installation)
Signal issues in some buildings (meters can’t connect)
Very occasionally, incorrect installations affecting supply

4. The IHD Often Gets Ignored

Many people check the In-Home Display enthusiastically for a few weeks, then forget about it. The novelty wears off.

5. Prepayment Concerns

Smart meters can be switched to prepayment mode remotely. Consumer groups worry this could make it easier for suppliers to force vulnerable customers onto prepay.

Do You Need a Smart Meter?

You Should Get One If:

You want access to time-of-use tariffs (Octopus Agile, Go, etc.)
You have or plan to get solar panels
You’re getting an EV and want cheap overnight charging
You’re fed up with estimated bills
You’re curious about your energy usage patterns

You Can Wait If:

Your current meter works fine and you submit readings regularly
You’re not interested in time-of-use tariffs
You have concerns about data privacy
Your property has signal issues (basement meter, thick walls)

Smart Meters and Smart Homes

Smart meters can complement your smart home setup:

Time-of-use tariffs: Schedule your smart plugs to run appliances during cheap rate periods
Energy monitoring: Combine smart meter data with smart plug monitoring to identify exactly which devices cost most
Solar integration: Smart meters track export, essential for seeing your solar payback
EV charging: Smart chargers can use smart meter data to charge when rates are lowest

However, smart meters don’t directly integrate with smart thermostats or other devices — they’re primarily for billing and monitoring.

How to Get a Smart Meter

Contact your energy supplier (online, phone, or app)
Book an installation appointment (usually 1-2 hours)
The installer replaces your meters and sets up the IHD
Your supply may be off briefly during installation
You’re done — readings are now automatic

Cost: Free. Suppliers are required to offer smart meters at no charge.

Frequently Asked Questions

Can I refuse a smart meter?

Yes. Smart meters are optional. Suppliers may encourage you repeatedly, but you can decline. However, you may miss out on certain tariffs.

Will a smart meter increase my bills?

No — it just measures what you use. If your bills go up after installation, it’s usually because estimated bills were too low before.

Can my supplier cut me off remotely?

Technically possible but heavily regulated. Suppliers cannot disconnect you without following strict protocols, and vulnerable customers have extra protections.

What if I switch suppliers?

SMETS2 meters work with all suppliers. Your new supplier will receive your data automatically.

Do smart meters use much electricity?

Negligible — around £1-2 per year. The IHD also uses very little power.

What happens during a power cut?

The meter stores data locally and syncs when power returns. You won’t lose any readings.

Our Verdict

Smart meters are useful but overhyped. They won’t magically cut your bills, but they do provide accurate billing and access to better tariffs.

Get one if: You want time-of-use tariffs, have solar/EV plans, or hate estimated bills.

Skip for now if: You submit readings regularly and aren’t interested in switching to dynamic tariffs.

For actual energy savings, focus on behaviour changes and smart heating controls — those make a bigger difference than the meter itself.