Can energy suppliers charge more at peak times with a smart meter?

The distinction matters because the two things are widely conflated. A meter is the measurement device; a time-of-use tariff is a contract. Smart Energy GB notes that all new flexible time-of-use tariffs require a smart meter to access all the benefits², and that some suppliers are already offering smart meter-only tariffs and smart time-of-use tariffs³. The meter is the entry ticket, not the ticket itself.

Where peak pricing does bite is at the end of the Radio Teleswitch Service, which older Economy 7 and similar setups rely on to switch between day and night rates. Without an upgrade, the supplier loses the ability to tell peak from off-peak use, and the consequences fall on the bill.

What a smart meter lets your supplier see

The unit of measurement is the half hour. A smart meter sends readings automatically, and the frequency can be monthly, weekly, daily or even half-hourly⁴. Smart Energy GB puts it more precisely: half-hourly readings mean the meter sends a reading to the supplier every 30 minutes². The same organisation notes that a meter sends readings on a half-hourly, daily or, in some cases, monthly basis⁸, and that this produces accurate rather than estimated bills⁹.

Frequency is not fixed at the highest setting. When a household accepts a smart meter, there is a choice about how often readings are sent to the supplier, including the option of roughly every 30 minutes¹⁰. Which? sets out the default position for older installations: a meter installed before 3 November 2022, with no supplier switch or contract change since, sends daily readings, and this can be increased to half-hourly or reduced to monthly¹¹. That is a meaningful control, because the resolution of the data is what makes time-based charging possible in the first place.

What the supplier sees is consumption by time, not what is happening inside the home. Ofgem lists the uses of smart meter data as billing for the energy used, offering new products and services such as new tariffs where permission has been given, and helping make the energy system more efficient by recording demand more accurately⁶. The same billing purpose appears in Ofgem's consumer guidance¹². For a household thinking about independence, this is the trade: finer data in exchange for access to tariffs and rewards that a dumb meter cannot support.

Can suppliers charge more at peak times?

Yes, within the terms of the tariff a household has agreed to. Smart Energy GB states that smart meters will enable suppliers to offer a greater range of time-of-use tariffs, and similar services, in the future¹³. That is the enabling condition rather than a description of any single price. The same organisation records that some suppliers are already offering smart meter-only tariffs and smart time-of-use tariffs³.

The structure of those tariffs is where peak pricing lives. Which? describes smart time-of-use tariffs as charging at least two different rates for electricity used during peak hours and off-peak hours⁵. Energy Saving Trust adds a third band, noting that prices can vary depending on whether it is peak hours, off-peak hours or shoulder hours¹⁴. A time-of-use tariff will charge a higher price for electricity used in the peak period¹⁴, and a lower price during lower demand, off-peak periods¹⁴.

There is no single national peak window. Which? notes that some heat pump tariffs come with a pricier peak rate between 4pm and 7pm⁵. That is one example from one tariff family, not a universal rule, and the hours that apply to any household are set out in its own tariff terms. The practical consequence is that the same appliance, run at 5pm and at 11pm, can cost different amounts, and the meter is what makes that distinction enforceable.

Time-of-use tariffs: cheaper off-peak, dearer at peak

A time-of-use tariff uses the meter to log electricity use and charges different rates during different time windows¹¹. Energy Saving Trust describes the offer as different electricity prices based on peak and off-peak times¹⁵, and Smart Energy GB describes a different price of energy at different times of the day¹⁶. The Welsh Government's climate action pages summarise the benefit as cheaper rates during off-peak hours and incentives for energy usage on high-supply days¹⁷.

Access is the constraint. Smart Energy GB states that all new flexible time-of-use tariffs require a smart meter to access all the benefits, including off-peak and EV tariffs², and that these tariffs are offered by some energy suppliers to their customers with smart meters⁸. Which? makes the same point from the consumer side: having a smart meter lets a household take advantage of advanced time of use tariffs⁷, and smart meters open up access to new tariffs that charge less for off-peak energy use, particularly beneficial to plug-in electric and hybrid vehicle owners¹⁸.

For electric vehicle charging specifically, the Energy Ombudsman states that for many EV-specific tariffs, particularly smart or time-of-use tariffs, a working smart meter is needed¹⁹. That is a hard dependency: without a functioning meter, the tariff cannot operate as designed.

The independence question here is real but partial. A household on a time-of-use tariff can shift load, use its own solar generation at the right hours, or charge a battery overnight, and be paid in lower rates for doing so. What it cannot do is escape the grid, the supplier or the tariff structure itself. The meter makes the household's flexibility visible and tradeable; it does not make the household self-sufficient.

Peak-time incentives for reducing demand

Alongside tariffs, there are schemes that pay for not using power at the busiest times. Smart Energy GB states that smart meters allow energy suppliers to offer incentives for households who can reduce their energy use during peak hours, helping to balance supply and demand and reduce pressure on the grid²⁰. The same organisation notes that smart meters enable access to smart tariffs and demand-flexibility events, which could reward you for using energy during off-peak times or when lots of clean electricity is available¹.

The National Energy Action guidance describes the Demand Flexibility Service directly: households with a smart meter could be eligible to take part in schemes such as the Demand Flexibility Service, which offers small financial rewards for using less electricity during peak times, usually late afternoon or early evening²¹. The phrase "small financial rewards" is the source's own, and it is worth taking at face value.

The system-level case is set out by Smart Energy GB as improving understanding of energy demand, supporting renewable energy integration, helping manage peak electricity demand and reducing energy waste²². The DCC notes that many energy suppliers offer lower rates during off-peak times, making it an attractive option for cost-conscious households²³, and that smart meters support demand response initiatives where users can shift consumption to off-peak times²³. Ofgem's list of data uses includes helping make the energy system more efficient by recording demand more accurately¹².

For a household, these schemes are a modest income stream tied to behaviour, not a route to independence. They reward flexibility the household already has, and they depend on the supplier, the scheme operator and a working meter. The Demand Flexibility Service and the wider household flexibility and reward schemes are covered in more detail elsewhere.

Where peak pricing hurts: RTS customers and billing

The sharpest problem is not peak pricing itself but the loss of the signal that separates peak from off-peak. The Radio Teleswitch Service is being switched off, and some older Economy 7 meters use it and will be affected, though not all Economy 7 meters are²⁴. Where a meter is not upgraded, the consequences are practical and financial.

Smart Energy GB states that electricity suppliers will not know how much electricity customers with RTS meters use during peak and off-peak times, and that electricity costs could be much higher than before²⁴. National Energy Action sets out the same failure in more detail: heating or hot water could be continually left on or off, charging-up happens at the wrong time of day, and the supplier cannot confirm peak or off-peak usage, which could mean higher electricity bills²⁵. The same wording appears in its RTS meters guidance²⁶.

Home Energy Scotland puts the billing risk plainly: you may be charged the wrong amount, because your supplier will not be able to track your energy use properly²⁷. Act on Energy describes the replacement options: moving to a smart meter allows a household to continue on a time-of-use tariff with cheaper electricity at night, and where a smart meter cannot be installed the supplier may install a different type of meter that can still offer a cheaper night rate, varying between suppliers²⁸.

For households that decline a smart meter, Home Energy Scotland notes that the supplier may install a meter with the tariff pre-programmed, requiring manual readings, without the full benefits of a smart meter, but with heating continuing to work²⁷. That is a workable fallback rather than an equivalent one. The RTS switch-off page covers the timetable and options in full.

Do you have to accept a smart meter?

No. Energy Saving Trust states that it is not compulsory to have a smart meter installed, and that if a supplier offers one it can be refused⁷. Uswitch notes that by law energy suppliers are required to offer smart meters to all their customers by a certain deadline, but customers can decline the offer²⁹. Confused.com records the same split: the government requires electricity suppliers to offer smart meters to all customers, and some providers require a smart meter for their tariff³⁰. WW Utilities states that suppliers are required to offer smart meters to their customers, but customers do not have to have one³¹.

The Energy Ombudsman adds an important technical point: all smart meters can support tariffs which charge different prices at different times throughout the day and night, including Economy 7, and Economy 10 meters are also available³². So the choice is not between a smart meter and time-based pricing; it is between a smart meter and a meter that cannot deliver time-based pricing reliably once RTS ends.

On cost, Ofgem states that a smart meter can be obtained free of charge by contacting the supplier⁶, and the same wording appears in its consumer guidance¹². Smart Energy GB notes that occasionally a supplier might need to carry out extra work that requires the homeowner to cover the costs³. On reversal, the Energy Ombudsman states that only under exceptional circumstances would a supplier be expected to change a smart meter to a traditional meter, and the supplier may charge the costs if it agrees³².

If something goes wrong, the government's rights and expectations guidance states that if a household suspects an issue with its smart meter, or the supplier identifies one, the supplier should promptly investigate it, resolving it themselves or with third parties, and keep the consumer informed³³. The smart meter rules and supplier obligations page sets out the wider framework, and are smart meters compulsory answers the refusal question in more depth.