This document describes a smart energy meter system that uses GSM technology to send electricity meter readings to a central server and alert users when their consumption is approaching a higher billing threshold. The system uses an ARM7 microcontroller connected to an energy meter, GSM module, LCD display and relay circuit. It takes readings from the energy meter periodically and sends them via GSM to be stored in a database. It also alerts users via SMS before their consumption increases and leads to a higher billing rate. This allows users to reduce usage and lower their bills. When bills are unpaid, the relay circuit disconnects power supply to the meter until payment is received.