Despite everything, the smart meter initiative is still viable, but Uttar Pradesh must now build the regulatory, procurement, and communication infrastructure it originally skipped to rebuild consumer trust, a process Bihar successfully completed beforehand.
A private company official entered Jagatpur Adil village in Uttar Pradesh's Fatehpur district in the first week of April to install smart meters, but the villagers opposed. The official tried to convince them by saying the installation of smart prepaid meters was compulsory.
"It is the order of the Junior Engineer of the electrical department," said the official. "The JE doesn't hold so much power that he can forcefully install smart meters," the villagers responded.
Their resistance came from suspicions already building: reports from neighbouring villages about over-billing and abrupt connection cuts had travelled faster than any official communication from the electricity department.
The private company official, for his part, was not wrong either. He had been assigned a task his employer needed completed. Whether it was truly compulsory was a question nobody in the chain above him had thought to resolve before sending him to the door.
The Electricity Act of 2003 gave consumers the right to choose between prepaid and postpaid supply. The Central Electricity Authority's (CEA) 2022 Metering Regulations said something different: consumers in areas with communication networks "shall" be supplied electricity through smart meters in prepayment mode.
The UP Power Corporation Limited (UPPCL) read the CEA provision as a mandate and proceeded accordingly. Even the UP Electricity Regulation Commission (UPERC), when asked to rule on the contradiction, declined to give a conclusive verdict. The Centre, which had written both provisions, said nothing for four years.
What failed was the system behind the villagers and the official both: a legal ambiguity the Centre left unresolved, a contractor model that paid the company only after meters were installed and passed that pressure down to field staff, and two years of tender collapses that compressed the entire rollout into a rushed sprint.
When that system finally broke, in protests across dozens of UP districts, in suo motu intervention by the state's own regulator, in consumers removing meters from their own walls, the Yogi Adityanath government reversed course entirely.
All 85 lakh prepaid smart meters would be converted to postpaid. No exceptions, including for consumers who had called UPPCL asking to retain prepaid connections, citing a 2 per cent bill rebate and real-time usage visibility. Those requests were declined.
The government that had stripped consumers of the choice to stay postpaid now stripped them of the choice to stay prepaid. The absence of consumer agency, the original sin of the rollout, survived the rollback intact.
The reversal came after Union Power Minister Manohar Lal Khattar told the Lok Sabha in April 2026 that prepaid smart meters were never mandatory, a clarification that should have come in 2022, before a single consumer was told otherwise. Days later, the CEA issued a revised gazette notification to that effect.
The smart meter idea was sound. UP's power sector carries accumulated discom losses of over Rs 1 lakh crore: a figure that has grown even as Aggregate Technical and Commercial (AT&C) losses have reduced, because efficiency gains have not translated into financial recovery.
A billing system that required a field visit to disconnect a defaulting consumer and another to reconnect them after payment was not just operationally expensive: it was a system that power thieves and chronic defaulters had learned to navigate with ease.
A digital metering system that could read consumption remotely, send SMS alerts, cut connections automatically on non-payment, and restore supply instantly on recharge was a genuine reform, the kind that, done well, could have meaningfully cut those losses and made Yogi Adityanath's administration a case study in power-sector modernisation.
What happened instead is a study in how good policy gets hollowed out between intention and doorstep.
The Yogi government was not naive about electoral timing. The tenders were floated in October 2022, seven months after the BJP's March 2022 assembly victory, in what appeared to be the safe middle of a five-year term.
The calculation was sound: absorb the friction of a difficult reform while votes were not immediately at stake. What the government did not calculate was that two years of tender collapses would push mass installation into 2025-26, compressing the entire consumer-facing rollout into the twelve months before election season began.
The Revamped Distribution Sector Scheme (RDSS) was launched in July 2021, with a total outlay of Rs 3 lakh crore and a target of installing 25 crore smart meters nationwide. UP's four main discoms floated tenders in October 2022 for 2.84 crore meters valued at Rs 23,000 crore.
The companies that submitted bids: Adani Group, GMR Group, L&T, and IntelliSmart, had one thing in common: none of them manufactures smart meters. Three were general infrastructure conglomerates for whom smart metering was one contract among many.
The fourth, IntelliSmart, was purpose-built as a metering solutions provider, but it too procures meters from manufacturers rather than making them.
The UP Electricity Consumer Council filed a petition with UPERC almost immediately, presenting a specific objection. Bid rates were running 48 to 65 per cent above the Rural Electrification Corporation's own pricing guidelines. Adani had quoted Rs 10,000 per meter against an REC guideline of Rs 6,000.
The council asked the regulator to break the clusters into smaller units so that actual meter manufacturers, companies that make the devices rather than merely manage contracts for others, could participate directly in the bid and bring costs down. The regulators took time. The discoms began reviewing the bids. By February 2023, one discom had cancelled its tender. By April 2023, three of the four had done the same.
The re-tendering took months. Eventually, IntelliSmart, a joint venture between the government-linked National Investment and Infrastructure Fund and Energy Efficiency Services Limited, won the PVVNL contract in April 2023 for 67 lakh meters across 14 districts of western UP. It was, at the time, the largest smart metering project competitively bid under RDSS in the country.
The solution to the problem of corporate intermediaries was, in effect, a government-linked intermediary. Mass installation began in earnest only in late 2024. New electricity connections were mandated to be prepaid from 10 September 2025.
The timeline of smart meter installation before the rollback.The two years lost to tender collapses had consequences beyond timing. They compressed the entire deployment into a sprint and handed it to a payment model that rewarded installation above everything else.
The AMISP (Advanced Metering Infrastructure Service Provider) model that UP eventually deployed is not unique to the state; it is the standard structure the Ministry of Power designed for RDSS across the country.
Under it, the AMISP finances meter procurement, handles installation, establishes communication infrastructure, and maintains the system for a contract period of eight to ten years. The discom pays nothing upfront. Instead, it pays the AMISP a per-meter-per-month service charge for the duration of the contract, but only after each meter is successfully installed and commissioned. Until the meter is not installed, the AMISP earns nothing on it.
The consequence of this structure at the field level is direct. An AMISP has borrowed capital to procure and deploy meters. That capital is idle until installation happens. The faster meters go in, the sooner revenue flows. Field staff are working against an installation count.
The delay in the procurement of smart meters and the subsequent quick deployment gave people little time to understand the scheme, the absence of consent made them suspicious, and the cases of overbilling and sudden power cuts, as the recharge done reflected late in the system, led them to lose trust in the scheme.
A more measured response: fixing billing irregularities, replacing faulty meters, enforcing AMISP accountability, might have saved the programme. But by April 2026, with protests spreading and the 2027 elections twelve months away, the government had run out of political runway for incremental correction. A full rollback was faster and cleaner than a repair process that would have required admitting specific failures in public.
What had been planned for 2022 reached consumers' walls by the end of 2025. The government's own downplaying of the issues by calling them the opposition's allegations left even less time for any course correction.
Thus, in the peak of the summer season, when power cuts naturally become frequent due to load issues, the power cuts due to smart meters compounded the crisis, which was felt more due to soaring temperatures, fueling outrage against the scheme overall.
The only immediate solution left was a full rollback, abandoning a programme that had drawn tenders worth Rs 23,000 crore and UP Budget 2026-27 allocation of Rs 4,155 crore, ignoring even those consumers who would have preferred to stay on prepaid.
While the scheme has been rolled back, a few other pricing and quality issues have surfaced, demonstrating that the pricing, the deployment, and the quality verification, each layer of the rollout produced its own irregularity.
One such irregularity was eventually uncovered by UPERC. UPPCL's own discoms had been procuring smart meters at Rs 2,500 to Rs 2,630 per unit. Consumers were being charged Rs 6,016 per meter, a markup of over 130 per cent.
How UP consumers paid more than double the meter cost.A consumer from West UP, on the condition of anonymity, told Swarajya, "We got our smart meter installed from a private company, which charges us Rs 3,500. The electricity department officials were asking for Rs 5,500 for the same smart meter."
UPERC has now ordered a refund of approximately Rs 200 crore to over five lakh consumers, calling the recovery "impermissible in a regulated regime." The order came in April 2026. The overcharging had been running for months before that.
Billing was not the only failure. UPERC's April 2026 order noted that reconnection within the mandated two-hour window, the basic service standard that a prepaid system must meet if consumers are to trust it, was achieved in only 77 per cent of cases against a benchmark of 95 per cent.
The commission asked UPPCL why a penalty of Rs 1 lakh per day should not be imposed. Network and software failures meant consumers who had recharged found their power still cut, because the confirmation of payment had not processed through a congested communication link between the meter and the central server.
The network and software failures can also be traced to poor-quality meters being used. Over 11 lakh meters installed were allegedly found to be using outdated 2G/3G communication modules. These struggled to connect to the 4G/5G-dominated network, leading to server errors during recharges.
UPPCL constituted a four-member technical committee on 12 April to examine complaints related to meter quality, connectivity and performance. The preliminary report found smart meters were functioning within prescribed parameters, with the final report still to be submitted.
But the testing process itself came under question. Avadhesh Kumar Verma, chairman of the UP Rajya Vidyut Upbhokta Parishad and a member of the Central Electricity Regulatory Commission's advisory committee, pointed out that the Gomti Nagar laboratory holds NABL accreditation only for testing conventional meters under IS 14697 and IS 13779 standards, not for smart prepaid meters, which are governed by IS 16444.
Smart meter testing under IS 16444 requires specialised assessment of electrical requirements, power consumption, radio frequency technology, communication capability and functional performance, none of which fall within the laboratory's accredited scope.
REC, which funds RDSS in UP, requires smart meters to be tested at Central Power Research Institute laboratories, utility laboratories, or NABL-accredited labs with the appropriate testing scope. The Gomti Nagar laboratory qualifies on none of these counts for IS 16444 testing.
The electricity corporation defended the process, saying the laboratory could conduct the "accuracy subset" tests of IS 16444 because those parameters overlap with the older standards. Verma has urged UPPCL to ensure all future testing is conducted at fully authorised laboratories.
What makes it look worse for the UP government is that it appears to be the only state to have messed up this project. Bihar, a neighbouring state that shares UP's scale, its urban-rural divide, its income profile, and its history of low consumer trust in utilities, took to smart meters with little difficulty, with the same prepaid mandate, and broadly the same starting conditions. What it did differently was everything between the policy and the doorstep.
As of early 2026, Bihar leads the country in smart meter adoption: all its sanctioned meters under RDSS are awarded, and the state operates entirely in prepaid mode. The difference between Bihar and UP is not the technology, the scheme, or the consumer base but the process.
Bihar phased its rollout. Urban areas came first, with a proof-of-concept stage before scale was attempted. Bihar chose Secure Meters, an actual meter manufacturer with installations across 12 countries, as its primary technology partner, rather than an infrastructure conglomerate subcontracting to one.
For connectivity, Secure Meters partnered with Airtel to deploy NB-IoT, Narrowband Internet of Things, across North Bihar, India's first such deployment at scale. NB-IoT is designed specifically for devices like smart meters: it penetrates thick walls and basement installations that standard cellular signals struggle to reach, consumes significantly less power, and maintains a stable low-bandwidth connection even in congested networks. Bihar's meters were built to communicate reliably. UP's running on modules that media reports alleged were outdated 2G and 3G technology.
Bihar did not stop at connectivity. The state used smart meter data to rebuild its understanding of where power was actually going. By comparing electricity input at the distribution transformer level against billed consumption at the consumer level, Bihar could identify, street by street, transformer by transformer, exactly where losses were occurring, without requiring additional hardware or blanket consumer suspicion.
In 2024, Bihar State Power Holding Company Limited partnered with Bidgely, a California-based AI analytics firm, to take this further. Bidgely's AI analyses individual consumer usage patterns to flag anomalous behaviour, meter bypassing, night theft, tariff misuse, processing data at the consumer level rather than working top-down from feeder to transformer. Within the programme's initial phase, over 136 potential theft cases were flagged, with successful enforcement action in 41 per cent of confirmed cases.
The result of this architecture is a system that can tell the honest consumer why their bill is what it is, and tell the discom where its revenue is disappearing. UP's rollout could do neither. Balances depleted faster than consumption explained, and the system had no answer for why.
Consumer trust, in Bihar, was also built through the interface. The Bihar Bijli Smart Meter app, serving both SBPDCL and NBPDCL consumers, offers real-time usage tracking, transaction history, and recharge functionality, and carries a 4.4-star rating from over one lakh reviews.
The app has complaints: server downtime, payment gateway friction, and delayed reconnection. But a 4.4-star rating from one lakh users in a state with Bihar's infrastructure profile is not a minor achievement. It reflects a consumer base that, on balance, finds the system usable - which is the minimum condition for a prepaid metering programme to survive politically. UP never got there.
How Bihar succeeded, but UP couldn't.In early 2026, REC Limited signed a tripartite agreement with Bihar's two discoms for independent third-party verification of installation quality, an external check on whether what was installed matched what was contracted. UP built no equivalent safeguard into its AMISP contracts. The consequence was a testing process, conducted after the crisis had already broken out, at a laboratory not accredited for the purpose.
The technology, deployed at scale in India's grid conditions, produces friction regardless of which state it is in. The difference is that Bihar built friction-reduction infrastructure before the scale arrived. UP deployed at scale and expected the friction to resolve itself.
The question UP's second attempt, if it comes, will need to answer is not whether smart meters work. Bihar has answered that. The question is whether the procurement process will select companies that have experience managing consumer relationships alongside installation targets, whether the AMISP contracts will include enforceable consumer communication requirements, and whether the regulatory oversight that was absent the first time will be designed in from the start.
Yogi Adityanath will manage the political costs of this episode. The rollback came early enough before the 2027 elections that the issue will lose salience, the Rs 200 crore in refunds will be adjusted quietly against future bills, and the government will describe the climbdown as consumer-responsive governance. Opposition parties will claim it as a victory. Both framings will be deployed, consume a news cycle, and recede.
The governance cost is harder to manage and will not recede on the same timeline.
UP's AT&C losses, which had improved to 16.39 per cent in FY2023-24, rose to 19.54 per cent in FY2024-25 - moving in the wrong direction in the year the smart meter rollout actively started. The accumulated discom losses stand at Rs 1.05 lakh crore.
The billing discipline that prepaid metering could have introduced, automatic disconnection on non-payment, instant reconnection on recharge, remote reading that eliminates the field visit, has now been removed from 85 lakh meters and replaced with the postpaid system, whose inefficiencies drove the reform in the first place.
The AMISP contractors are still being paid. The per-meter-per-month service charge that IntelliSmart and other contract holders receive is tied to the meter being installed and operational - not to whether it is running in prepaid or postpaid mode.
The financial architecture of the rollout is still running, collecting its monthly fee, for a model the government has officially abandoned. What that fee amounts to across 85 lakh meters and the remaining contract months is not a number UPPCL has disclosed, because the contracts remain confidential, but whether that amount would be collected from consumers is yet to be decided.
Any second attempt will carry the memory of this one. The consumers who had meters installed without consent, who were overcharged by 130 per cent, who lost power after recharging because a network failed to confirm their payment, are the same consumers the next rollout will need to convince. Consumer trust, once spent, is not restored by a gazette notification. It is restored by a system that works, every time, without requiring the regulator to intervene before it behaves correctly.