The energy firm has continued to install ‘first generation’ smart meters (SMETS1), failing to install ‘second generation’ meters (SMETS2) when it should have done so.

Ofgem said this means that for customers with a first generation smart meter wishing to switch, they could lose all functionality, face inaccurate bills, need to provide manual readings and the display unit could show old tariff information.

Ofgem said this therefore “undermines the smart meter rollout” and means Utilita is not currently meeting its licence obligations.

As such Ofgem is consulting on whether to issue Utilita with a final order which would require it to install 250 new smart meters by 30 April 2021 and 15,000 by 31 July 2021 or it will be banned from taking on new customers.

Charles Hargreaves, Ofgem’s deputy director of conduct and enforcement at Ofgem, said: “Smart meters are vital for upgrading Great Britain’s energy infrastructure, enabling customers to be better informed and engaged in managing their energy consumption by providing them with real time information on their energy use.

“Smart meters also help enable the transition to a more flexible energy market and the move to a low carbon economy.

“Ensuring all energy suppliers take all reasonable steps to install SMETS2 meters for new and replacement meters is critical to the success of the smart meter rollout as it enables smart meters to operate reliably for all consumers regardless of their energy supplier.”

Ofgem will consult on the final order until 4 January where it will then make a decision.

If Utilita fails to install SMETS2 smart meters when it should do so, Ofgem could take further enforcement action.