Pubs Face Smart Meter Requirement for New Fixed-Term Energy Deals From 2027
Pubs and other small and medium-sized hospitality businesses will need to have, or agree to install, a smart meter in order to sign up to a new fixed-term energy contract from September 2027, under rules confirmed by the Government.
The Department for Energy Security and Net Zero (DESNZ) has set out plans to expand smart meter uptake across non-domestic premises, including licensed venues, as part of a wider drive to give businesses clearer insight into their energy consumption.
What’s changing
From 1 September 2027, energy suppliers will be required to make smart or advanced meter installation — or agreement to one — a condition of entering into a new fixed-term contract for eligible businesses. Suppliers must begin informing affected customers of the upcoming change from 1 January 2027, giving operators several months’ notice before the rule takes effect.
The requirement will not apply universally to all commercial premises, but is aimed at smaller and medium-sized non-domestic businesses, a category that covers the vast majority of independent and small-group pubs.
Why the Government is acting
Ministers say fixed-term energy contracts, while typically cheaper than default out-of-contract rates, are increasingly only accessible to businesses willing to have a smart meter fitted. DESNZ argues the change will help close that gap while boosting overall smart meter coverage.
The department forecasts that smart meter penetration among smaller businesses and other non-domestic sites will reach 88% by the end of 2030 under the new rules, compared with a projected 73% if no action were taken.
Officials estimate the policy could save non-domestic energy customers as much as £194 million over the scheme’s ten-year appraisal period, with total benefits — including efficiency and system-wide gains — put at up to £340 million. DESNZ says the savings will largely come from businesses being able to monitor and manage their energy use more precisely, though it acknowledged some supplier costs linked to the rollout could be passed on to customers.
The Government published its full response to the consultation on the policy on 1 September 2026, alongside a final impact assessment and accompanying guidance for both suppliers and businesses.
Political reaction
The plans have drawn criticism from the Conservatives. Shadow energy secretary Andrew Bowie argued that businesses should retain the choice over whether to have a smart meter fitted, rather than facing what he characterised as pressure to comply in order to access competitive contract terms. He linked the move to broader concerns over rising costs facing employers, and said the Opposition’s alternative approach would prioritise cutting bills for business through its own energy policy proposals.