A utility meter that not only records consumption but reports it back over a network on its own — the return channel, not the display, is what makes it smart.
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A smart meter is a utility meter that records how much electricity, gas or water is used and sends the reading back on its own. EU law defines it as a system that measures, gives more information than a conventional meter, and can transmit and receive data electronically. That return channel is the whole distinction, and it is where the label gets stretched: Windhoek's prepaid water units are sold as smart meters, but residents buy a 20-digit code from a vendor and type it into a battery-powered in-home unit. Nothing travels anywhere.
A real channel changes what a utility can see and charge for. Incheon's water utility has fitted IoT terminals to digital meters since 2021, replacing a monthly manual reading with one every six hours — often enough to flag an abnormal flow as a suspected leak, which is how utilities chase non-revenue water. Electricity meters change the bill instead: Ontario moved Toronto Hydro customers onto time-of-use rates from June 2009, so an afternoon kilowatt-hour costs more than a night-time one.
The meter is the cheap half. Ontario's Auditor General found the province had spent close to CAD 2 billion against an initial CAD 1 billion projection, on a business case written after installation began — and a peer-reviewed study of more than 20,000 households measured a 2.6% fall in on-peak demand. Interval readings are also a record of when a home is occupied, and a prepaid meter can cut supply without anyone deciding to.
Added 2026-08-10 · Part of the growing Smart City Glossary