Applies from 1 Sep 2027 · GB business supplies
Business Smart Meter Rules 2027: What Changes for Fixed-Term Energy Contracts?
From 1 September 2027, businesses with smaller and medium-sized energy supplies entering a new fixed-term electricity or gas contract will need to either already have a smart or advanced meter, or agree to have one installed as part of the contract. It is a significant change to the business energy market, but it does not mean every UK business is being forced to have a smart meter from September 2027.
Your supplier may simply need to confirm the existing smart or advanced metering arrangement.
You will need to agree to a suitable smart or advanced meter installation as part of the contract.
The new requirement attaches to new fixed-term contracts for premises in scope.
The framework includes protections where genuine barriers outside the customer's control prevent installation.
This is not a blanket order requiring every business to install a smart meter on 1 September 2027.
The change is about new fixed-term energy contracts. From 1 September 2027, where a qualifying non-domestic site enters a new fixed-term contract, the supplier must make sure the contract says the customer already has, or agrees to have, suitable smart or advanced metering installed.
That distinction matters. For most businesses this should be treated as part of renewal planning, not as a reason to replace a working meter immediately.
Which business supplies are in scope?
The initial policy focuses on smaller non-domestic sites, which government guidance refers to as designated premises.
For electricity, the current smart-meter mandate covers non-domestic sites in profile classes 1 to 4. For gas, it covers sites using less than 732 MWh a year. Larger electricity and gas supplies are already subject to separate advanced-metering obligations.
In practical terms, that means the change is particularly relevant to many shops, offices, hospitality venues, professional services businesses, smaller manufacturers, public-sector sites and other everyday commercial premises.
A recent bill, MPAN or MPRN details and meter information will usually tell us enough to establish the current metering arrangement before renewal becomes time-sensitive.
Ask us about your metering set-up →Can a business refuse a smart meter?
This is where the headlines can become misleading.
A business is not simply being told that every premises must have a smart meter installed on a particular day. The rule works through the contract.
If the site is in scope, you must already have suitable smart or advanced metering, or agree to an installation.
The government's own material is candid that the usual alternatives are deemed or out-of-contract arrangements, which it describes as significantly more expensive than a fixed term.
That is why the meter should be considered alongside price, term, supplier service and the rest of the contract. If the alternative is remaining on an expensive out-of-contract or deemed rate, the commercial impact can be much more important than the meter itself.
What if my current contract runs beyond September 2027?
The change concerns new fixed-term contracts entered into from 1 September 2027. It does not automatically rewrite or cancel an existing fixed agreement.
If your present contract runs into 2028, for example, the rule becomes important when you arrange the next fixed-term contract. There is therefore no reason to panic or replace a perfectly functional meter purely because the policy has been announced.
The sensible step is to identify problems early. A locked communal meter room, landlord consent, an unusual meter arrangement or known technical work can all become frustrating if they are first discovered when a renewal is already due.
What if you agree, but the meter cannot be installed?
The new framework is not intended to punish a co-operative customer for a problem genuinely outside their control.
The policy includes a legally binding consumer protection code for smart-contingent contracts. Where an installation cannot proceed because of a genuine barrier outside the customer's control, the supplier should not attempt to enforce the smart-meter terms, and should not treat the customer as if they had simply refused to co-operate.
For example, the existing installation or site set-up means the work cannot yet be completed.
The meter may sit in a locked or shared area controlled by somebody else.
Where additional works are needed before the meter can go in, the supplier must take all reasonable steps to make sure you keep the benefit of your fixed-term contract at no additional cost while the works remain unresolved.
This is different. Contract consequences may apply where the customer agreed to installation and then chooses not to proceed without an external barrier.
Where the supplier cannot verify the barrier itself, it may ask you to sign a declaration confirming the circumstances. That declaration is treated as evidence, so it must be accurate: false statements carry consequences for the contract.
The practical point is simple: if something prevents installation, record it, tell the supplier and keep the paper trail rather than letting the issue drift.
What if I rent my business premises?
Commercial tenants may need landlord permission before a meter exchange or related work takes place, depending on the lease and the nature of the installation.
DESNZ has specifically addressed the landlord and tenant issue because it can otherwise prevent a business meeting a contractual commitment to its supplier. Its published view is that a commercial landlord who refuses a tenant's request to install a smart meter, where the tenant needs it to meet that commitment, would likely be acting unreasonably.
That does not mean every request is automatically straightforward. Some sites need building work, electrical alterations or access arrangements first. If you already know your landlord or managing agent controls the meter room, raise it before the renewal is urgent.
We can help identify the current metering position and the parties likely to need involving before the next contract starts.
Talk to us about the site →The customer is not the only party with obligations.
Suppliers must tell customers about the smart-meter condition before a contract is agreed, from 1 January 2027 at the latest, and must comply with the consumer protection code once it is in force on 1 September 2027.
The code also sets an expected timetable. If you do not already have a smart meter, your supplier should contact you within three months of supply starting under the contract to book the appointment, and should ensure the meter is installed within 12 months of supply starting. The legal obligation is to take all reasonable steps to meet both, so treat them as the expected timetable rather than a guarantee, and chase if that first contact does not arrive.
Separately, Ofgem's smart-meter Guaranteed Standards of Performance have applied since 23 February 2026. A microbusiness is due £40 automatic compensation if the supplier does not offer an installation appointment within 60 working days of you requesting one, cancels within 24 hours of the appointment, fails the installation on the day because of something within its own control, or does not respond to a reported smart-meter fault within five working days. Microbusiness broadly means fewer than 10 employees and turnover of no more than £2 million, or under 100,000 kWh of electricity or 293,000 kWh of gas a year.
For the business customer, the key point is that an agreement to install a meter should not mean accepting an open-ended process with no information. Keep appointment records, emails and details of any access or technical issues.
Is this the same as Market-wide Half-Hourly Settlement?
No. They are related to the wider modernisation of the energy system, but they are different changes.
Market-wide Half-Hourly Settlement, or MHHS, changes how electricity consumption is settled across the market using more detailed consumption data. The 2027 smart-contingent contract policy is about whether qualifying business customers already have, or agree to have, suitable metering when entering a new fixed-term energy contract.
Five sensible checks before your next renewal.
Many businesses will already have suitable smart or advanced metering and may have very little to do.
The rule matters at the point of a new fixed-term contract from 1 September 2027, not simply because the calendar reaches that date.
A renewal is the wrong time to discover nobody knows who has the key to the meter room.
Understand what you are agreeing to, what the supplier says will happen if the installation cannot proceed, and whether you are being asked to sign a declaration.
Price, term, pass-through charges, supplier service and metering conditions should be considered together.
Plain-English answers.
Do businesses have to have a smart meter from September 2027?
Not automatically. For qualifying non-domestic premises, new fixed-term contracts entered into from 1 September 2027 must include a term that the customer already has, or agrees to have, smart or advanced metering installed.
Can a business refuse a smart meter?
A business can choose not to agree to an installation, but a qualifying site would then need to consider a different contract arrangement rather than the new fixed-term contract subject to the smart-meter condition.
Does the rule apply to electricity and gas?
Yes. The initial scope covers smaller non-domestic electricity and gas sites within the existing smart-meter mandate.
What if I already have a smart meter?
If the existing meter meets the relevant requirement, there should not be a need to agree to another installation simply because of the new contract rule. The supplier may still need to verify the arrangement.
Does it affect a fixed contract I have already signed?
The new universal implementation requirement applies to new fixed-term contracts entered into from 1 September 2027. It does not automatically rewrite an existing fixed agreement.
What if my landlord prevents the installation?
The framework includes protections for genuine barriers outside the customer's control. The supplier may need information or evidence about the circumstances, sometimes a signed declaration, and should follow the consumer protection process rather than treating the situation as a simple refusal.
Is a smart meter the same as a Half-Hourly meter?
Not necessarily. Smart, advanced and Half-Hourly metering describe related but different aspects of metering and data collection. Read our MHHS guide for the settlement changes.
From September 2027, the meter becomes part of the contract decision.
We can review your contract end date, current metering and supplier options together, so you understand what you are agreeing to before you sign. If a metering issue appears afterwards, you still have a named adviser to come back to.
No obligation · Named adviser · Commission disclosed before signing
