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Abstract—Industrial Energy Measurement System (IEMS) used for measurement of electrical energy consumed by high-tension industrial consumers. It consists of three current transformers (CTs) and three potential transformers (PTs). Cost of IEMS increases with improvement in its accuracy class. The contribution of this article is that, it adduces design and development of high accuracy class and cost-effective IEMS. To accomplish this, a novel Industrial Energy Measurement-Error Compensation Unit (IEM-ECU) is proposed. To realize this, first, the three different accuracy classes, viz. 0.2, 0.5, and 1.0 IEMS are fabricated in the laboratory. Characteristics of every CT and PT are determined. Second, the proposed error correction algorithm is implemented in real time to improve errors of IEMS. Finally, the experimental results are depicted in LabVIEW for mixed class of CTs and PTs. Various experimental tests have been performed and results are validated by comparing the results obtained from digital storage oscilloscope. These results clearly illustrate that the proposed IEM-ECU not only convert lower accuracy class IEMS to higher accuracy class but it also gives flexibility to use available class of CTs and/or PTs, if required under contingency. Thereby, considerable cost savings can be achieved as the performance of lower accuracy class matches with the higher accuracy class. [ABSTRACT FROM AUTHOR]