Upgrading to a Smart Electricity Meter: Projected Cost & What to Expect

Smart meters, much like the name would suggest, perform the same function as your ordinary electricity meter, with some key differences that give it more advanced capabilities benefitting both you and energy retailers. But before we discuss the cost, installation process and evaluate their benefits, let’s quickly run through the basics of solar smart meters - what are they, what’s their purpose, how do they work and who is responsible for installation?

At its core, a smart meter has the same fundamental purpose as a traditional meter: to measure and record electricity usage so your energy retailer can calculate your power bill. However, smart meters offer enhanced features that go well beyond the capabilities of analogue meters, especially for homes with solar power or energy storage.

The key feature that sets smart meters apart is two-way communication. While traditional meters require manual readings, smart meters automatically send real-time data to your energy retailer, typically every 15 to 30 minutes.

This is particularly beneficial for solar-powered homes, as smart meters can track electricity flowing into your home (from the grid) and out (when you export excess solar power). This makes them essential for receiving accurate solar feed-in credits.

Smart meters deliver more precise readings, eliminating the need for estimated bills, and their wireless communication removes the reliance on manual meter readings. They can also detect outages or faults and instantly alert the network provider, allowing quicker response times. In contrast, traditional analog meters only capture usage data periodically, usually once per billing cycle, require a technician to read them, and cannot support or measure exported solar energy.

Accurate and Frequent Readings
Smart meters record and transmit your usage data every 15–30 minutes. This ensures your solar feed-in credits are calculated correctly and that your energy bill reflects your actual consumption and generation.

Two-Way Power Flow Support
Solar homes often use grid electricity at night or on cloudy days and export excess energy during peak solar hours. Smart meters are designed to handle these two-way energy flows, unlike traditional meters.

Before your smart meter installation, your energy retailer is required to provide key details to ensure you’re well-informed about the process. This includes:

• Who will be installing your smart meter – typically a licensed technician or contractor arranged by your retailer.

• When the installation will take place – installations are usually completed within 15 business days, or on a mutually agreed date.

• An overview of the installation process – including notice that your electricity supply will need to be temporarily turned off during the procedure.

• Any associated costs or changes to your contract – such as updated pricing, metering charges, or billing arrangements.

In 2018, updates to the National Electricity Rules (NER) introduced clearer regulations for smart meter installation timeframes. These rules were designed to reduce delays and provide greater certainty for households and businesses awaiting meter upgrades.

Overview of Installation Timeframes:
These regulations apply to both new electricity connections and existing meter upgrades or replacements. Installations must occur either:

• On a date agreed upon by both you and your energy retailer, or

• If no agreement is reached, the installation must take place within:

  • 6 business days for new electricity connections

  • 15 business days for meter exchanges or upgrades

Now you have a general understanding of smart meters, we'll take a look at some key information like the overall and individual costs of a smart meter, any additional fees as well as important points on pricing and contract changes. 

Costs vary depending on your location, energy provider, and property type. According to the Australian Energy Regulator (AER), the average installation cost in 2020 was $226—but how and when you pay can differ.

• No Upfront Cost: The retailer covers installation and adds the cost to your bill—either as a lump sum or spread over time.

• Promotional Upgrade Offers: Some retailers provide "free" smart meter upgrades. Be sure to check for hidden costs—like increased electricity rates or changes to your plan.

• Upfront Payment: Some providers require full payment for the meter and installation. This is straightforward but still warrants reviewing contract terms carefully.

• Pay Over Time: Costs may be spread across monthly or yearly payments, separate from your regular usage charges. This can make budgeting easier.

Some households will incur additional charges relating to any additional electrical maintenance or upgrades that must be conducted before the retailer can install your smart meter. This isn’t common, though. More than 90% of households looking to install a smart meter feature adequate electrical systems that can handle the integration of a smart meter and require no further work. 

The other 10% of the time, the home's electrical systems will need further work before it is safe, feasible or even possible to install the smart meter. This is mostly seen in older homes and buildings where the existing electrical systems are outdated and will usually require maintenance in order to facilitate the meter. The most common ways homeowners choose to have this carried out : 

1. Pay your energy retailer the grid isolation fee in order to shut off your power, and the work can then be conducted. 

2. Alternatively, you can hire your own registered electrician to carry out all the necessary work for you. 

Here are a couple of common questions around installing a new smart meter along with some helpful information and important considerations: 

Again, I wish I could give you a straight answer on this, but much like the overall cost, this is highly dependent on your energy retailer. It’s not unusual for your supplier to ask you to enter into a new contract, which then, in turn, means new pricing. This price change may not come into effect until the term of your current contract ends, so this is an important element to check over. It’s vital to know the parameters around this before installation. 

For some retailers and their billing plans, this is NOT a requirement of owning a smart meter, although don’t knock it until you try it; many find a time-of-use plan beneficial and the preferred option for their home. 

If you do feel that remaining on a flat rate electricity plan is the best option for your lifestyle and individual situation, even after the installation of your smart meter, you may need to shop around to find a retailer who will offer you this service. Many retailers are hesitant to offer fixed rate plans to households with smart meters installed; this isn’t greatly beneficial to either you or your supplier.

A fixed plan essentially means the price that you pay for your energy is fixed, not subject to change and fluctuations, remaining the same no matter the time of day. When on a fixed rate plan, the amount you are charged on your power bill is calculated using the energy used and time spent using the electricity.  The benefit of this is in the predictability of expenses. Still, it’s important to note that while, yes, you will have a better idea of what to expect and not leave yourself open to nasty surprises, the flip side of this is you’re also eliminating all possibility of receiving any pleasant surprises too.

The Australian Government is all for the installation of smart meters across the country due to their more accurate and reliable nature. National rules have been put in place to ensure the widespread uptake of digital energy meters. As of December 2017, all new electricity meter installations for residential properties and small businesses must be smart/digital meters. The aim is to phase out the use of analog or accumulation meters entirely across all states. 

This essentially places the onus on local network providers to facilitate the installation of upgraded smart meters in their area. This applies to both residential and small business properties. Under this legislation, a modern smart meter must be used for any necessary or requested meter upgrades. 

Your energy retailer may offer upgrades to a group or individual properties in their area. You can opt out of this, provided your existing meter is operational and functions as it should.

An embedded network is a private electricity network with a single, main electricity meter (commonly called the ‘parent meter’) and smaller meters (‘child meters’) located on individual sites. This is a common structure for shopping malls, retirement villages, caravan parks and apartment buildings. 

Step one for this process is ensuring the meterboards and any other components are in good working order and don’t require any additional work to be carried out. 

Step two is to contact your embedded network manager or operator. If you’re unsure who this is, you may need to ask the building owner/owners' corporation. 

If your existing meter is not faulty and still functions as it should, you may incur additional costs depending on your retailer.

Although it’s difficult to give firm pricing, hopefully, this article has helped to provide clarity on what this process could look like for your property and has also helped you to either prepare for your upcoming upgrade or has helped you decide whether a smart meter is a good option for your specific situation.