Smart Metering is a major initiative throughout North America and has merit in respect to empowering the consumer to conserve electricity.  A Smart Meter monitors and records how much electricity you use and when you use it. It then communicates this data wirelessly to a central computer. When time-of-use (TOU) prices come into effect, they will vary depending on the time of day, the day of the week, and the month of the year (summer or winter). This technology will provide customers with the information they need to make choices about how and when they use electricity. Further, Utilities will have the advantage to better monitor lawful use of electricity.  The key word here is lawful use of electricity.

Smart Metering can also help reduce tampering at the meter, however when it comes to a straight electrical bypass of electricity; the Smart Meter cannot identify this theft remotely.*

Numerous Smart Metering companies are promoting Smart Metering as a means of Reducing Theft, while upon closer scrutiny the reductions are very limited.  The Smart Meter can determine if there is tampering at the meter or if the meter is reversed (upside down) and it can measure substantial voltage drops (depending on model & Utility Infrastructure), but a service crew has to attend the area, further, the voltage drop has to be measured against something; namely a separate meter at the transformer. Further, the extreme costs associated with placing a separate meter at every transformer and associated installation, maintenance, and communication costs are prohibitive for any Utility.

The President and Founder of dTechs has extensive experience dealing with Organized Crime.  He has instructed and lectured on this issue throughout North America and the United Kingdom.  In his policing career he has observed over 700 electrical bypasses or tampering.  In these 700 he has seen one inverted meter and approximately 30 meter tamperings where the criminal went into the back of the meter and jumped the meter posts.  The remainder, 96% of electricity theft was obtained with a bypass prior to the meter, and thusly would not be detected by a Smart Meter.  Whatever crime groups that are tampering with the meter (4%) would simply learn to switch to a full bypass.

*Theft of power may be detected more easily if it involves meter tampering. However, theft accomplished by tapping conductors before they reach the meter would not be detected by smart metering.  The benefit may not be significant if most power is stolen by this latter method.  However, aggregated load data by transformer would facilitate comparison with transformer capacity and help an LDC (Local Distribution Company) determine if meter bypass was likely cause of overloading leading to failure." 

Ontario Energy Boards 'Smart Meter Initiative' Working Group