Ofgem has warned that it could stop utility Utilita Energy from taking on new customers unless it installs 15,000 second generation smart meters by 31 July 2021.
The number of smart meters rolled out in October hit a record high, with almost a quarter of a million installations.
Energy regulator Ofgem is investigating ScottishPower in a bid to determine if the supplier breached rules around its smart meter obligations.
During the second quarter of 2020, 850,000 less domestic smart meters were installed in Britain than in Q1 due to COVID-19.
The number of smart meters installed in the UK jumped by 120% in July from the previous month.
Half of suppliers have failed to reach their smart meter installation milestones, and were more than 10% outside of the tolerance allowed.
The government has extended the obligation to take All Reasonable Steps (ARS) to install smart meters by six months, as a result of COVID-19.
Regulations will come back into full force from 1 July, Ofgem has signalled in an open letter to suppliers.
Smart meter installations dropped in Q1 of 2020, as the impact of COVID-19 began to be felt in the UK in March.