Written by Tiana Lee-Collins
Reviewed by Meredith O’Brien
Last updated 14/02/2024
If you’ve ever researched electricity retailers (also known as providers) and how they track your energy usage, chances are you’ve heard about smart meters. But what are these devices, how do they measure energy usage data and can they help you keep energy bills down? We answer these questions and more.
A smart meter is a power-monitoring device that replaces traditional electricity meters and provides you (and your energy retailer) with insight into your energy consumption.
Smart meters record and send energy usage information data in half-hourly blocks to your energy provider to measure the amount of electricity you use.
These digital meters (also known as type 4 meters or advanced interval meters) can do more than track your power usage. They can:
There are also other meters available that aren’t smart meters. For example, basic meters only record data every 3 months. Type 5 meters can still record half-hourly data but can’t do things that type 4 or advanced meters can do (such as send the data to the distributors) and a meter reader is required to download the data from the meter.
If you have a smart meter, or are looking at getting one installed, you may be able to use it to access certain tariffs and better manage your energy so you can save on electricity bills. Our Head of Energy, Meredith O’Brien, has some tips on helping you get the most of your smart meter.
Sign up to your provider’s online account or app to view your smart meter data. By doing so, you’ll be able to see what times of the day and days of the week you’re using the most energy and make changes to ensure you aren’t wasting energy.
With a smart meter, you may be able to take advantage of flexible pricing with time-of-use tariffs. Check with your electricity retailer on whether you can shift this usage to off-peak times to save on costs or compare electricity retailers to search for one where you can. With this, you’ll also need to change your energy habits to ensure that you use most of your electricity during off peak or shoulder periods. Otherwise, this can be more expensive if you only use the bulk of electricity during peak periods.
You can use your smart meter to connect to smart devices in your home. You may be able to remotely power our smart devices and time them, so they only operate when you need them to, helping you lower your energy use.
Smart meters record how much electricity you use and when, then sends this information to your electricity distributor. While smart meters are widely used in Victoria, many states still rely on three-monthly actual or estimated readings (where your energy usage is calculated based on previous usage patterns). In fact, only 30% of all homes outside of Victoria currently have a smart meter.1
However, it works differently depending on your state or the type of meter you have.
According to the Victorian State Government, smart meters work through a four-step process:2
However, type 4 meters operate slightly different and are more common in New South Wales and Queensland. While they still record half-hourly information about your energy usage, the fastest they currently send data to distributors is every 24 hours. Once this information is available, your provider will share it with you.
Your eligibility for a smart meter will depend on a series of factors, including if:
Contact your energy provider to see whether you’re eligible to get a smart meter and what the next steps are. Your electricity provider will provide you with a smart meter if your current meter needs replacing or if you move to a plan that requires a smart meter.
The cost for smart meters varies between electricity providers. Some may waive upfront costs or smart meter installation fees but include other fees as part of your bill. Others may set their own servicing and maintenance fees. Always discuss these costs with your provider and compare your options.
Smart meters give you more options for saving money; primarily, through electricity tariffs. If you’re on a time of use tariff, you could potentially save money by using your energy-heavy appliances during off-peak times and minimising your electricity usage during peak periods.
Adjusting your behaviour using data from your smart meter is one way to save – provided you have the corresponding tariff to support it.
With smart meters, you may have access to time-of-use tariffs as your provider will have the ability to monitor your usage throughout the day and charge accordingly.
If you’re eligible for a time-of-use tariff, you can take advantage of this by:
The core function of some smart meters is to transmit your household’s energy usage levels to your electricity provider. Of course, some smart readers may still require a manual read, so check your smart meter’s capability with your provider.
It might surprise you to learn that your smart meter can also act as a simple communications device if you have an in-home display, registered for SMS alerts or have an online account or app to view your energy information. Energy providers can send public warnings about major power outages in your area and the estimated restoration time.
Thanks to your smart meter’s continuous two-way dialogue between your household and your energy provider, it can also help your distributor quickly identify any faults in the service or on the smart grid. This minimises downtime and helps streamline the reconnection process in the event of a blackout, ensuring your provider can get your power up and running again as quickly as possible.
Smart meters can remotely perform some key tasks on behalf of your energy provider, such as connecting and disconnecting your energy when moving. This makes moving to a new home quicker, easier and cheaper, as your meter is read daily.
Smart meters can also slash disconnection and reconnection fees, as companies don’t physically need to come to a property to turn power on or off. However, this can only occur if it’s safe, otherwise a meter reader will still need to physically attend the property. Distributors can still set their own fees for this service, which can vary between states.
You can monitor your energy usage in real-time with web portals, smart meter apps and in-home displays, which gives you more control over your usage. For example, they can help you figure out the best and worst times to use appliances with high-energy usage. You can also set up your system to receive warning messages for excessive energy usage.
What’s more, if you have solar power, you can use your smart meter to monitor how much of it you’re using and change your usage patterns to take advantage of your solar panels’ electricity generation.
With smart meters, you can time when your appliances will start or turn them on remotely to manage energy usage if you have smart devices and a Wi-Fi connection.
While smart meters can track your electricity usage, they’re not something you can read manually. Instead, the meter service provider will receive information about your electricity consumption and then make this information available to you.3
You’ll usually be able to access this information online by logging into an account with your electricity provider. You typically have the option of viewing your hourly, daily, weekly and yearly usage, including any solar energy you’re generating if you have solar panels.
Smart meters look similar to the older electricity meters you’re probably used to. While they’re similar in size, you’ll notice that most smart meters don’t have a dial and have a digital display. Of course, the exact appearance can vary between models and providers.
As the Head of Energy at Compare the Market, Meredith O’Brien understands that energy is something we all rely on and is passionate about helping Australians to be as informed as possible when it comes to their energy plans.
Meredith has six years within the energy industry, following 15 years of experience in financial services and is currently studying a Master of Business Administration. Meredith is a dedicated customer advocate who is passionate about empowering Australians to find the right products to suit their needs by removing the confusion from comparing.
1 Australian Energy Market Commission (AEMC). Review of the regulatory framework for metering services. Published August 2023. Accessed October 2023.
2 Victorian State Government: Environment, Land, Water and Planning. Smart meters. Last updated September 2022. Accessed October 2023.
3 Australian Government: Australian Radiation Protection and Nuclear Safety Agency. Smart meters and health. Accessed October 2023.
