The vast majority of homes in Canada have smart meters, already enabling a third of Canadian provinces and territories to implement demand flexibility incentives, but regional disparities persist.
A future net zero electricity grid will not just mean building more clean electricity, but also being smarter about how Canadians are using electricity, and importantly, when.
That involves making Canada’s electricity grid more flexible by shifting consumption away from peak periods of electricity demand where possible and enabling consumers to make more flexible decisions about when they use electricity. Smart meters are a key technology in accomplishing this goal. They allow two-way communication between utilities and consumers, empowering both with real-time data on energy consumption patterns. Critically, they give utilities the ability to offer electricity rates that incentivize shifts in consumption away from peak periods.
This Insight explores the progress of smart metering deployment in Canada. Despite more than twenty years of deployment, the installation of these technologies is still uneven across the country. That risks leaving valuable benefits on the table especially as households become more electrified than ever before.
What are smart meters?
Smart meters are devices that automatically measure and record electricity usage in real-time or near real-time. This is in contrast to traditional analog meters, where meters are measured on a bi-monthly or monthly basis by operators collecting the data on-site instead. In many ways, implementing smart meters is a first step to making it easier for utilities to improve flexibility in the electricity grid.
The switch to smart meters brings immediate administrative benefits. They help reduce expenses for manual meter reading, and lower administrative and billing costs since data is recorded electronically. Because the data is collected in real time, they provide customers more accurate billing and greater visibility into their energy use, and enable better conservation practices. Smart meters also enable customers who have solar generation to sell electricity they generate at home back to the grid (known as net metering), making the grid more responsive to other sources of generation.
Perhaps the most important benefit of smart meters is that they enable utilities to know exactly how much electricity a customer is using and when. That in turn enables a set of tools to influence customer choices about when they use electricity, including time-of-use pricing and peak reduction incentives such as British Columbia’s Peak Saver program. Time of use pricing allows utilities to set prices that change with the rise and fall of energy demand. Customers typically shift their consumption of electricity off of peak demand periods when prices are high to access lower rates, presenting a win-win scenario on affordability: lower rates for households who use electricity in off-peak hours, and lower costs for utilities can balance their load and optimize their existing assets and can defer costly capital peak technology investments.
It can also mean lowering emissions if utilities can avoid using emissions-intensive gas peaker plants.
Canada has made big progress deploying smart meters
Canada has been an early adopter of smart meters. Programs to update analog meters to their smart ones started being introduced in the early 2000s. By the end of 2018, Natural Resources Canada estimated that 82 per cent of meters in Canada were classified as smart meters. Figure 1 shows the progress of smart meter deployment across provinces and territories in Canada.
Figure 1
Several jurisdictions have already completed their smart meter rollout, including British Columbia, Quebec, Ontario, and most recently, Nova Scotia.
British Columbia’s Smart Metering Program was completed at the end of 2015 and deployed more than 2 million meters to customers while staying about $150 million under budget. BC Hydro estimated that smart meters delivered $235 million in benefits in the first five years of the program.
Similarly, Nova Scotia recently completed their deployment of smart meters to more than 500,000 customers, and anticipates savings of about $203 million over 20 years against the maximum installation cost of $133 million (including contingency).
Quebec also finished their rollout in 2015, and in the 2024–2025 season alone, more than 400,000 households participated in flexible rate schemes, which was able to shift 530 MW of demand off of each peak period event. That’s the equivalent to saving electricity to meet the demands of 70,000 homes.
Additionally, jurisdictions that have completed their mass deployment of smart meters have also rolled out residential demand response programs. These programs encourage households to reduce consumption during ‘peak events’ in return for financial incentives.
Other jurisdictions are catching up. New Brunswick began installations in 2023 and has reached 61 per cent of customers. P.E.I.’s regulator approved a smart meter rollout by Maritime Electric in 2023. In Alberta, Fortis—operating mostly in rural Alberta outside of Edmonton and Calgary—plans to install 760,000 meters by 2029. SaskPower in Saskatchewan had completed 24 per cent of installations as of December 2024. In Nunavut, Qulliq Energy Corporation, in partnership with Natural Resources Canada, has installed 4,000 meters in Iqaluit—the first smart meter deployment in Canada’s Arctic.
Smart meters will become increasingly important as households electrify
As a first step in making the grid more flexible, the peak shaving value of smart meters depends on utilities using them to deploy demand-flexibility tools like time-of-use pricing. Once deployed, smart meters can create incentives for customers to shift their power demands accordingly.
This will become increasingly valuable as more households electrify and the demand for electricity grows over time. According to Canada’s Energy Futures, electricity consumption is expected to dominate end-use residential energy by 2050 (Figure 2).
Figure 2
Much of this added energy demand for electricity will come from the switch from fossil fuel technologies to electric ones like electric vehicles and electrified heating. Already, there is an increasing appetite for smarter use of electricity. Many of Ontario’s customers, for instance, are offered the choice between time-of-use rates or Ultra-Low overnight rates, introduced in 2023, which gives customers a 2.8¢/kWh rate overnight in exchange for higher on-peak rates at 28.4¢/kWh. BC Hydro also allows the option for time-of-use rates to their electric vehicle meter only, offering additional flexibility to customers who would like to keep their main household meter out of time-of-use pricing.These rates are particularly tailored to households that rely on electric vehicles or more flexible technologies such as battery storage.
As Canada continues to build bigger, cleaner, smarter electricity systems, the benefits of flexibility measures like smart meters will be more apparent for both utilities and customers. The success of tools like smart meters and time-of-use pricing is contingent on utilities being enabled by their regulators to design and roll out good tools that customers want.
Arthur Zhang is a Senior Research Associate at the Canadian Climate Institute. Alexander Vanderhoof was a Research Associate, Mitigation at the Canadian Climate Institute.