Compensation for faulty smart meters and install delays
It comes as part of a crackdown on broken smart meters, which has seen the regulator help enforce the repair or replacement of more than 600,000 faulty meters since July last year.
MoneySavingExpert.com founder Martin Lewis welcomed the proposals as he said 'likely one in five' smart meters are faulty.
It is thought that millions of smart meters have been left in so-called dumb mode, where they have poor connectivity or stop automatically transmitting readings.
Ofgem said that by extending rules to cover poor connectivity, it will mean more consumers can get compensation.
Charlotte Friel, director of retail pricing and systems at Ofgem, said: 'Millions of consumers rely on their smart meter every day for accurate billing, cheaper tariffs, automatic meter readings and real-time data to help keep track of spending.
'But we know many customers that want a smart meter wait too long to get one installed or face delays on repairs when it stops working – this needs to change.'
She added: 'These new rules are about setting clear expectations of suppliers, incentivising them to boost smart meter standards, and protecting consumers from poor service if things go wrong.'
The plans mean that suppliers will need to improve smart meter standards or pay out from early 2026, according to Ofgem.
Mr Lewis said: 'Far too many smart meters, likely one in five, don't work as they should – a problem not just for all the homes with broken ones, but for the smart meter rollout.
'With so many dissatisfied customers, word-of-mouth is bad, so people tell their friends and neighbours not to get one.
'We need to shift firms' focus from just installing smart meters to promptly fixing those that are broken – not just meters that go into dumb mode, but crucially all elements, including in-home displays that stop working.'
Under the new rules, micro-businesses will also be able to get compensation for smart meter issues.
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Minister for energy consumers Miatta Fahnbulleh, said: 'Consumers are at the heart of our mission to deliver an energy retail market that works for everyone, as we accelerate towards a clean, homegrown power system to protect households against global fossil fuel price spikes.
'That's why the Government is taking action, alongside Ofgem, to ensure families are better protected when they get a smart meter installed.'
U-switch said its research found that one in five households with a faulty smart meter had been waiting more than two years to have their device fixed.
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