The Smart Export Guarantee: getting paid for the electricity you send to the grid
By the Offrano editorial team · · 4 min read
Solar panels produce most when many households are out, and whatever the house does not use flows back into the network. The Smart Export Guarantee makes sure that small generators in Great Britain can be paid for that exported electricity. It is not a grant and it does not pay a fixed rate. This guide explains how it works, what you need before you can apply and what to compare when choosing a tariff.
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What the scheme is
The Smart Export Guarantee, or SEG, launched on 1 January 2020 as a government-backed scheme administered by Ofgem. It requires some electricity suppliers, called SEG Licensees, to offer a payment for low-carbon electricity that small-scale generators export to the grid. Payments are based on export meter readings.
Solar PV is one of five eligible technologies, alongside wind, micro combined heat and power, hydro and anaerobic digestion. Installations must be in Great Britain and within the scheme's capacity limits, which comfortably cover domestic systems. Northern Ireland is not part of the scheme.
Source: ofgem.gov.uk
What the guarantee does and does not guarantee
The word 'guarantee' refers to access, not to the price. SEG Licensees set their own rates, contract lengths and other terms. The only fixed rule on price is that the tariff must always be above zero. One supplier may offer a flat rate; another may offer a rate that varies with the time of day or with wholesale prices; some pay more if you also take their electricity supply.
That is why Ofgem advises generators to shop around. It also means that any quote presenting a precise export income over 20 years is making an assumption about tariffs nobody can guarantee.
Source: ofgem.gov.uk
What you need before you can apply
Two things decide whether an application goes smoothly. First, payments are calculated from export meter readings, so you need a meter that records what you export, in practice usually a smart meter. Second, installations up to 50 kW must show suitable certification of both the installation and the installer, which for solar PV in practice means an MCS certificate issued by the installer, or an equivalent scheme.
If your panels were installed without certification, for example by a general electrician, you may struggle to join a SEG tariff. Ask about certification before you choose an installer, not after.
- an MCS certificate for the installation, or equivalent
- an export-capable meter, usually a smart meter
- proof of ownership or the right to the payments
- your bank details and the installation's details for the application
Source: ofgem.gov.uk
You do not have to use your own supplier
You can apply for a SEG tariff with any SEG Licensee. It does not need to be the company that supplies your electricity, and you can use separate companies for export payments, electricity supply and gas. Every licensee must offer a tariff to all eligible generators and publishes its own application process.
Some of the most attractive export rates are tied to taking the same company's import tariff. Compare the combination, not the export rate alone: a high export rate paired with an expensive import tariff can leave you worse off.
Source: ofgem.gov.uk
Batteries and the value of exporting
Exported electricity usually earns less than you pay to buy electricity. For most households, using more of their own generation is worth more than exporting it. That is the argument for timing appliances, heating water with surplus solar and, in some cases, a home battery.
Whether electricity exported from a battery qualifies depends on the supplier's terms and on how the battery is metered and charged. Ask the supplier directly before counting on it.
The same applies to heat pumps and electric cars: a household that shifts hot water heating or car charging into sunny hours changes how much it exports, and therefore which tariff suits it best.
Order of events for a new system
A sensible sequence is: choose a certified installer; make sure the network operator is notified; have the system commissioned and receive the MCS certificate; make sure an export-capable meter is in place; then compare SEG tariffs and apply. Payments start from the date agreed with the licensee, so avoid a long gap between commissioning and applying.
If you are planning solar panels and would like a quote, you can send a request through Offrano. It is offered to installers in your area without your contact details, and exactly one can buy it; we tell you who by email before it sees your details. There is no charge to you.
Source: mcscertified.com