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Great Britain will be the first country in the world to have an overhaul of this size for both electricity and gas meters.
Smart meters enable meter readings to be taken remotely and together with a display device give householders real time information on their energy use.
The new information smart meters provide will help consumers to see what energy they are using and how to save money on their bills.
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Smart meters will mean the end of estimated bills, no more having to stay in for home readings, quicker and smoother switching between suppliers and cheaper, easier prepayment.
The Government has today set out the different options for rolling out the revolutionary kit across Great Britain and on what the smart meters should be capable of doing.
Energy and Climate Change Secretary Ed Miliband said: "This is another part of our Great British refurb. The meters most of us have in our homes were designed for a different age, before climate change. Now we need to get smarter with our energy.
"Smart meters will empower all consumers to monitor their own energy use and make reductions in energy consumption and carbon emissions as a result. Smart meters will also mean the end of inaccurate bills and estimated meter readings.
"This is a big project affecting 26 million homes, and several million businesses, so it's important we design a system that brings best value to everyone involved."
(CD/JM)
