Six of the UK’s biggest gas and electricity suppliers have been ordered to pay £10.8 million after failing to meet targets to install smart meters.

Energy watchdog Ofgem said British Gas, Bulb, OVO, E.On, Scottish Power and SSE all fell short of the target for 2022 by more than one million smart meters.

It is the first-time energy suppliers have had to meet the target, which is part of a four-year plan from the government launched in January 2022.

The companies have agreed to pay the money into Ofgem’s fund to help vulnerable households, with British Gas paying out the most, at £3.4 million, followed by Ovo at £2.4 million and Bulb, which was bought out of administration by Octopus in December 2022, at £1.8 million.

The Government set the industry annual minimum goals to roll out smart meters, as they are seen as being an important part of reducing energy usage and switching to a more flexible energy system.

Smart meters allow households to track energy usage and access smarter tariffs that can save money by encouraging energy use outside peak times or when there is an excess of clean electricity available.

Cathryn Scott, director of enforcement and emerging issues at Ofgem, said: “The installation of smart meters is a vital step in the modernisation of our energy system and the path to net zero by 2050.

“Smart meters give customers better information about their energy usage helping them budget and control their costs.”

Ofgem said as a result of the agreed payouts, it will not conduct a further probe into the reasons for the missed targets.

As of June this year, Ofgem said more than 33 million smart meters have now been installed in British homes and small businesses, representing 58% of all meters across the UK.

How much will your energy supplier be forced to pay?

Ofgem said the suppliers will make the following payments into its Energy Industry Voluntary Redress Fund:

  • British Gas – £3.37 million
  • Ovo – £2.39 million
  • Bulb – £1.83 million
  • E.On- £1.72 million
  • Scottish Power – £1.24 million
  • SSE – £252,000

Scottish Power will also make a further £440,000 payment into the redress fund in relation to missing its own smart meter goals in 2019, before the latest government targets were set.