The payments should be automatic in three situations
Households with smart meters could receive automatic £40 payments each time they encounter one of these three issues as new rules come into play from today (Feb 23). However, one more issue is still being considered by Ofgem and could be added to the eligibility list later this year.
Previously, firms only had targets for installing smart meters for customers and many were left with failing devices and poor customer service. These new rules are meant to force energy firms to prioritise repairs and ensure every smart meter is functioning correctly.
Problems that can result in £40 compensation:
- Waiting more than six weeks to have your smart meter installed
- Installation appointment fails due to fault within the supplier’s control
- You don’t receive a ‘resolution plan’ within five days of reporting an issue with your smart meter
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 first category only applies to new or first-time installations. It will not apply if you are waiting more than six weeks for an appointment to repair or replace your smart meter.
Issues that are deemed to be ‘within a supplier’s control’ for the second category include things like not having an engineer with the right skillset available or not having the correct equipment to safely complete the installation.
Resolution plans are meant to explain what they have done to assess the issue you have reported and what actions the firm is taking to resolve it. Resolution plans cover both smart meters and linked in-home devices.
Ofgem first rolled out the proposals for these smart meter compensation rules in August 2025. At the time, the list of situations that could trigger automatic compensation also included if your smart meter was operating in ‘dumb’ mode.
These are smart meters that don’t send readings to the supplier. The original proposal said households would be eligible for the compensation if this wasn’t fixed within 90 days but this rule is still being contemplated.
Ofgem said, according to MoneySavingExpert, that it “intends to take forward further work” on the issue “with a view to implementing it later this year”. But the regulator is awaiting the Government’s response to its own review or smart meter performance standards.
If you experience one of the qualifying issues, your supplier should pay out the £40 compensation within 10 working days and you shouldn’t have to do anything to request it. It may be issued as credit in your energy account or paid directly into your bank account, the supplier can choose which of these methods it wants to use.
If you end up waiting more than 10 working days for the payment, you could get an extra £40 on top of the original compensation but this will only happen once per incident.
