Smart meters are being rolled out across Australia, giving households a clearer picture of how they use electricity. While your bills may be more accurate, whether a smart meter actually saves you money comes down to how and when you use your power.
How do smart meters work?
Smart meters – also known as advanced meters – track how much electricity you use in real time, measuring your usage in short intervals of five to 30 minutes and sending this information to your energy retailer. Unlike older meters, they don’t need someone to visit your home to take a reading. Instead, they use secure wireless communication such as mobile networks or dedicated radio signals to transmit the information.
This gives a much more detailed picture of how and when you use power throughout the day – meaning retailers can bill you more accurately.
What are time-of-use tariffs?
Before smart meters, most households were on flat rate tariffs, where you paid the same price for electricity no matter when you used it as there was no way to monitor it. With the rollout of smart meters, many distributors and retailers have shifted to time-of-use tariffs, allowing them to charge different rates depending on the time of day.
Under this structure, customers pay more during peak periods and less during off-peak times. Some regions may also have shoulder pricing and solar sponge periods, which offer reduced-cost energy at specific times.
The exact time periods depend on where you live. Generally, peak times occur in the afternoons and evenings when most people are at home and energy usage spikes; some areas also have morning peak periods. These are the most expensive times to use electricity.
Off-peak times are when demand is lowest, often overnight or in the early morning hours, and electricity is cheapest during these times.
In some cases, you might be placed on a demand tariff, where part of your bill is based on the highest amount of electricity you use during any short period – usually a 30-minute window – within a billing cycle. This means you pay extra based on your highest power demand during peak hours, in addition to your normal energy usage charges.
Can I choose my electricity tariff if I have a smart meter?
When you have a smart meter, you’ll usually be placed on a time-of-use or demand tariff as the default. While you might be able to switch between these dynamic tariffs, moving back to a flat rate tariff can be difficult.
If you want to switch tariffs, you’ll need to apply through your electricity retailer. Since distributors often charge retailers based on time-of-use rates and the retailer will have to cover any extra costs if the new tariff is more expensive for them, they may be reluctant to approve a switch back to a flat rate tariff.
Switching tariffs may also involve fees, and generally, you can only change your tariff once every 12 months.
Consumer protections for new smart meter installations
For smart meters installed between 2025 and 2030, new Australian consumer protections require your electricity retailer to get your consent before changing your tariff structure for two years after installation.
This means your retailer cannot switch your plan from a flat rate tariff to a time-of-use tariff without your permission during that time.
How do I know if I have a smart meter?
If you’re not sure what type of meter you have, you can usually tell by taking a quick look at the meter inside your property’s electrical box.
Basic meters
A basic meter may have:
- A set of spinning dials
- An odometer-style number display
- A small digital screen that simply shows your total usage
These meters can’t send data automatically, so you’ll either need to submit your own readings or have someone visit periodically to take a manual reading. Around this, your bill will be based on estimates.
A digital display doesn’t automatically mean it’s a smart meter. Many older meters have digital readouts but no communication technology.
Smart meters
A smart meter will typically have:
- A larger, more detailed digital screen
- Extra information such as usage data, error codes and signal indicators
- Built-in communication technology that sends your usage data directly to your retailer
Because they transmit data automatically, you won’t need to submit readings yourself.
Are smart meters compulsory in Australia?
Whether you have to get a smart meter depends on where you live in Australia.
Victoria was the first state to mandate smart meters, starting the rollout in 2008 and completing it by 2014. Almost all Victorian households now have smart meters.
In New South Wales, South Australia, Queensland, the ACT and Tasmania, smart meter installation is also accelerating.
In late 2024, the Australian Energy Market Commission (AEMC) announced changes to speed up smart meter rollout across these regions. They removed the previous opt-out option, making smart meters compulsory starting June 2025. This means if your electricity retailer contacts you to arrange installation, you won’t be able to refuse.
As of November 2024, here’s the percentage of households with smart meters in these areas:
| State/territory | Percentage of households with a smart meter |
|---|---|
| ACT | 40.27% |
| NSW | 39.17% |
| QLD | 42.63% |
| SA | 46.49% |
| TAS | 78.06% |
| Source: AEMC | |
In Western Australia and the Northern Territory, energy markets and regulations work differently, but both governments are focused on smart meter rollout, aiming to reach 100% smart meter coverage by 2027 and 2034 respectively.
While you can’t prevent a smart meter from being installed on your property in these regions, you may be able to get the ‘smart’ function disabled at a cost.
Do I need to pay to install a smart meter?
If your electricity retailer contacts you to install a smart meter, there won’t be any fees for the installation. However, if you request the installation yourself, such as when adding solar panels or a battery, you may be charged.
Before any installation, your retailer must notify you beforehand and give a time range for when the installation will take place.
Smart meter pros and cons
Pros
-
Accurate billing
You pay for the electricity you actually use, not estimates. This helps avoid overpaying upfront or facing unexpected bills later.
-
Track your energy usage
You can see when you use the most power and adjust your habits to take advantage of cheaper times of day.
-
Less hassle
There’s no need to submit meter readings or wait for someone to visit as your usage is sent automatically to your retailer.
Cons
-
May cost more
If you can’t shift your electricity use to off-peak times, moving to a time-of-use tariff could increase your costs – and you might not have the option to switch back to a flat rate tariff.
-
Data sharing and privacy concerns
Smart meters collect and transmit detailed information about your household’s energy use. There are concerns about this data being intercepted or misused.
Can a smart meter help me save money on my energy bills?
Simply having a smart meter won’t lower your energy bills. In some cases, it could even lead to higher costs due to the dynamic tariffs in place, which charge different rates depending on the time of day.
If most of your power use is during peak hours, your bills could go up rather than down. To actually save money, you’ll need to pay closer attention to when you use electricity and try to shift your usage away from peak times to take advantage of lower rates – though this isn’t always easy, especially if you work typical 9-to-5 hours.
Your energy bill will show your peak times and the rates for each period. These times are set by your energy distributor, not your retailer, and vary by region. Here’s a breakdown of time-of-use periods across all states and territories:
As an example, an electricity customer in South Australia might have a time-of-use plan with peak rates of 60c/kWh and off-peak rates of 40c/kWh. If they stopped running the washing machine during peak evening times and instead programmed it to start early in the morning, they could reduce the cost of running it by about a third.
If they were able to run the washing during SA’s solar sponge period – from 10 am to 3 pm – they could benefit from even lower costs. Assuming prices around 20c/kWh during this time, they could save up to two-thirds compared to peak rates.
These changes might seem minor but can add up over time and make a noticeable difference to the energy bill.
While peak times are fixed, rates vary by retailer, so if you have high energy use or can’t shift your consumption, it pays to compare plans and look for ones with lower usage rates to help keep your bills down.
