SaskPower says it has reached an agreement with U.S.-based manufacturer Sensus to recover the $47 million cost of removing smart meters that were installed across the province.

The Crown utility says it will receive a $24 million cash refund from Sensus for all the smart meters purchased by SaskPower, including the ones that had already been installed.

SaskPower will receive an additional $18 million credit from Sensus for future metering products. In addition, the manufacturer will invest $5 million towards the research and development of a next-generation meter that meets SaskPower’s specific needs.

In a news release Tuesday, SaskPower said the new meter will meet industry standards and pass verification by an independent third party to ensure the units function safely.

SaskPower president and CEO Robert Watson says a “smart grid” will bring benefits to customers, including faster restoration of service following an outage, reduced carbon emissions and more timely and accurate billing.

Watson says SaskPower will continue to replace the smart meters with digital ones until a new model is ready.

He says Sensus has a three-year window to come up with an improved meter.

"If they're not able to produce a meter that's acceptable to SaskPower or independent specifications, they will pay us $18 million cash," Watson said at a news conference Tuesday.

"We're talking about a meter that's brand new for the environment. Not only is it a good business decision, not only is it going to assure our customers of a safer meter, it will be the next generation."

Crews are expected to finish removing all the smart meters that had already been installed by the end of this year. SaskPower says there will be no impact on electricity rates.

Sensus, which is based in North Carolina, has said tests indicate some of the fires were caused by power surges or holes in the meter boxes that allowed water in.

Sensus stressed the "critical importance" of careful meter installation, including examination of meter boxes and wiring. It also said installers need to be properly trained and that fast action is required when problems are first detected.

The NDP Opposition said it's not sure that entering into another contract with Sensus is a good idea.

Deputy leader Trent Wotherspoon said accepting $24 million for the faulty meters is little more than "pennies on the dollar."

"The contract that was put together by this government with this American provider wasn't worth the paper that it was written on," he said.

And the $18 million in credit, he added, simply keeps the province tethered to the manufacturer with no other options.

"Our taxpayer dollars ... are being held by Sensus and we're tied into entering into contract with them once again."

Wotherspoon also said the government receiving full compensation for the money it spent on the smart meters is proof that the province didn't complete due diligence.

The Saskatchewan government previously ordered SaskPower to remove 105,000 installed smart meters after eight fires linked to the devices were reported in the province.

With files from The Canadian Press