What is the Smart Export Guarantee and how does it work?

What is the Smart Export Guarantee?

The Smart Export Guarantee (SEG) is a government-backed scheme that requires licensed energy suppliers to pay households and businesses for surplus solar electricity they export back to the National Grid. It was introduced on 1 January 2020 under the Smart Export Guarantee Regulations, replacing the Feed-in Tariff (FiT), which closed to new applicants in March 2019.

Unlike the Feed-in Tariff, the SEG does not offer a fixed rate set by the government. Suppliers set their own rates, and they compete with each other for export customers.

Who must offer a SEG tariff?

Any licensed electricity supplier with 150,000 or more domestic customers is required by law to offer at least one SEG tariff. Smaller suppliers can offer SEG tariffs voluntarily. As of 2024, most major UK energy suppliers offer SEG tariffs, though the rates vary considerably.

You are not required to use the same supplier for your import (buying electricity) and export (selling surplus) tariffs. You can shop around independently for the best SEG rate.

What do you need to qualify for the SEG?

To register for a SEG tariff, your solar system must meet the following requirements:

• The installation must be certified under the Microgeneration Certification Scheme (MCS), or an equivalent standard.
• The system must have a maximum capacity of 5 megawatts (for most residential and small commercial solar, this is not a limiting factor).
• A smart meter must be installed at the property so that export can be accurately measured.

Once these conditions are met, you apply directly to your chosen energy supplier for a SEG tariff. The supplier cannot legally refuse if your system meets the eligibility criteria.

How much can you earn from the SEG?

SEG rates are set by individual suppliers and change over time. Rates in the UK have ranged from 1p to over 15p per kilowatt-hour depending on the supplier and tariff type. Some suppliers offer variable rates that move with the wholesale electricity price; others offer fixed rates for a set period.

The Ofgem SEG register lists all approved SEG licensees and their published rates. Comparing tariffs before you sign up is straightforward and can make a meaningful difference to annual export income.

What is the difference between the SEG and the old Feed-in Tariff?

The Feed-in Tariff paid a fixed rate for both generation (all electricity produced) and export (surplus sent to the grid), regardless of whether the electricity was actually used or measured. The rates were set by government and guaranteed for 20 years from registration.

The SEG pays only for electricity that is metered and exported. There is no generation payment. Rates are set by suppliers, not the government, and are not guaranteed long-term. For households that installed solar before March 2019, the Feed-in Tariff continues to apply for the full 20-year term.