Ministers hope the smart meters will help people use energy more efficiently by providing a range of useful information ranging from how much is being used on a daily basis to the total cost.
The mammoth roll-out of smart meters will be a world first and will involve the installation of 47 million units in just over a decade.
Energy and Climate Change Minister Lord Hunt of Kings Heath said the meters would provide consumers with "better information on how to manage their energy use, accurate bills and easier access to a wider range of tariffs".
But he said the sheer numbers involved introduced a "scale of complexity".
"Given the scale of the issues that we require a sensible period of preparation. We anticipate a period of around two years to resolve the issues and design the full details of the domestic roll-out.
"Our aim is therefore to ensure that subsequent roll-outs happens over a period of 10 years. This would see delivery of smart meters by the end of 2020," he added.
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