One of Britain’s biggest national infrastructure projects in decades is coming off the rails, according to a welter of criticism from politicians, consumer groups and media outlets.

The target of the carping is not the HS2 railway project or Heathrow runway expansion, but the government’s requirement for energy suppliers to offer all homes and businesses a smart meter by the end of 2020.

The meters automate readings, encourage saving by showing consumption in pounds and pence, and should put an end to billing problems.

Industry and government both argue that they are vital for helping the UK’s electricity grid cope with an increasing but variable amount of wind and solar power.

They could also reduce the need for costly upgrades to power grids, aid integration of electric cars into the energy system and open up a host of innovative tariffs where energy costs vary based on time of use. In short, they are seen as a essential foundation for much of the UK’s energy future.

But this summer saw calls for their rollout to be halted because of problems occurring after customers switch. A downbeat report by the British Infrastructure Group – a parliamentary body run by the former Tory party chairman Grant Shapps – topped the news bulletins.

Separately, statistics released in August showed that the rollout has lost momentum at exactly the time it should be speeding up. About 1.25 million smart meters were fitted in the second quarter of 2018, up just 1% on the previous quarter.

Installations have only just passed the 13 million mark – a long way from the 53 million there would be if every household and business had one.

Embarrassingly, about 940,000 have lost their smart functionality after people switched supplier – meaning consumers once again have to manually submit readings.

The figures prompted the consumer group Citizens Advice, which recently called for the 2020 deadline to be delayed to 2023, to declare that energy suppliers would have to work at an “increasingly unrealistic pace” to complete the rollout.

However, advocates argue that, far from coming off the rails, the project is actually, finally, coming of age.

This was meant to be the year that most of the programme’s problems were fixed by energy suppliers switching from fitting first-generation meters, known as Smets1, to second-generation Smets2 units.

Technical problems with the newer ones have meant the government has had to repeatedly push back the cut-off date for installing Smets1 meters. However, those problems appear to have finally been solved.

The Observer can reveal there are now more than 30,000 Smets2 meters installed in homes and businesses across the country – a rapid acceleration from a total of just 1,000 in June. About 1,000 are now being fitted each day.

British Gas, the UK’s biggest energy supplier, has fitted more than 5,000. Smaller suppliers, which have been waiting for Smets2 units, say they are starting to install them at pace.

British Gas, the UK’s biggest energy supplier, has fitted more than 5,000 second-generation smart meters. Photograph: Darren Staples/Reuters

Robert Cheesewright, director of policy and communications at Smart Energy GB, the body set up to promote smart meters, said the arrival of Smets2 meters in homes was “an important milestone”.

The programme should get a further boost from November, when the first-generation meters’ problem of losing smart functionality after switching suppliers starts to be fixed. That will involve an over-the-air patch to “enrol” them into a central body handling the meter data, which is run by the outsourcing firm Capita. Angus Flett, chief executive of that body – the Data Communications Company – said it had made “significant progress”.

Still, there is little doubt among industry watchers that the rollout remains behind schedule.

Alan Whitehead, the shadow energy minister, said: “The car hasn’t actually crashed yet, but all the signs of a big accident are around us.”

Whitehead said he believed that the 2020 target would be missed but did not want to see the technology ditched. “We really shouldn’t contemplate a future where we simply abandon smart meters and continue with old analogue meters.”

James Heappey, Conservative MP and chair of the all-party parliamentary Clean Energy Group, said installation of the older meters should continue in the short term, despite their problems, to stop the rollout from faltering.

“I certainly wouldn’t argue in favour of a hiatus, because then the momentum is lost,” he said.

A spokesperson at the Department for Business, Energy and Industrial Strategy said: “More than 400,000 smart meters are being installed every month, helping people to take control of their energy use and save money on their bills.

“Everyone who wants a smart meter will get one by the end of 2020.”