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Smart Export Guarantee and Feed-in Tariffs

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Smart Export Guarantee

What is the Smart Export Guarantee (SEG)?

The Smart Export Guarantee is the new support mechanism designed to ensure small-scale generators are paid for the renewable electricity they export to the National Grid. It has been in place since 1 January 2020. You may be eligible to apply if you have one of the below renewable energy generating technologies:

  • solar PV panels,
  • a wind turbine
  • hydro
  • anaerobic digestion
  • micro combined heat and power.

Following the closure of the Feed-in Tariff scheme to new applicants in March 2019, the government recognised the need to pay small-scale renewable energy generators for the electricity they export to the grid. So the Department for Business, Energy and Industrial Strategy (BEIS) introduced the Smart Export Guarantee (SEG).

The Smart Export Guarantee came into force on 1 January 2020.

Under the scheme, all licenced energy suppliers with 150,000 or more customers must provide at least one Smart Export Guarantee tariff. Smaller suppliers can offer a tariff if they want to on a voluntary basis. All suppliers can also choose to offer other means of making payments for exported electricity, separate to the SEG arrangements – see ‘Alternative finance arrangements’ below.

If you already receive a Feed-in Tariff on your installation, this is unaffected by the launch of the Smart Export Guarantee.

Which renewable energy installations are eligible for SEG?

The following renewable energy installations are eligible for the smart export guarantee:

  • Solar PV systems, onshore wind, anaerobic digestion, hydro – up to 5MW
  • Micro-combined heat and power – with an electrical capacity of up to 50kW

Any typical domestic system would be well within these size limits.

The technology and installer used by householders must be certified under the Microgeneration Certification Scheme (MCS) or equivalent. Energy suppliers may ask you to provide a MCS certificate to prove your installation meets this standard.

Exported power must be metered using a meter capable of reading exports on a half hourly basis, even if half hourly readings are not required for the tariff. Meters must also be registered for settlement.

Unlike the Feed-In Tariffs scheme, there will not be any requirement for properties to meet minimum energy efficiency standards.

How much will I receive for exporting electricity with SEG?

There are no set or minimum tariffs for the Smart Export Guarantee – the only requirement is that the tariff must be greater than zero at all times. In practice, this means that it is up to energy suppliers to decide what tariffs to offer their customers. They may choose to offer multiple tariffs or just one.

SEG tariffs can be fixed or variable. A fixed SEG tariff will pay a determined rate per kWh of electricity exported over the length of the contract. A variable SEG tariff will vary the price baed on market demand, with the only requisite that prices never fall below zero. Ofgem will report on the tariffs available, as well as how many people are on them, each year

Can I combine SEG with other grants and financial support?

Yes. The only exception is if you already receive payments under the Feed-in Tariff scheme. You cannot receive both a Feed-in tariff and SEG payments, although you can choose to opt out of your Feed-in Tariff and receive SEG payments instead.

SEG payments are not linked to other financial support around renewable energy installations. This means, if eligible, you could combine SEG payments with other financial support offered by Energy Saving Trust such as the Home Energy Scotland loan for example.

You will not be able to receive SEG from more than one supplier.

SEG and energy storage

Some solar PV or wind turbine installations will have energy storage systems attached to them. In these cases, the battery could store electricity imported from the grid (known as brown electricity) before exporting it later on.

Energy suppliers do not have to pay you for brown electricity exported to the grid but they may choose to do so.

Some suppliers may only pay the SEG for green electricity i.e. the electricity your low-carbon system generates itself. If this is the case, the supplier may ask you to show how you separate out the green electricity you generate from any imported brown electricity. Speak to your installer about how to do this.

Alternative finance arrangements

In addition to SEG, energy suppliers are offering similar deals by paying customers set tariffs for electricity they export to the grid. Deals are specific to each household and could involve your generation and supply being metered. Deals may also be time limited and have other conditions, such as requiring you to purchase your supplied electricity from the same supplier. You should consider all terms and conditions carefully in order to make the best choice.

The Solar Trade Association website lists the current deals available.

If you are based in Scotland and haven’t yet installed a renewable electricity technology such as solar PV, you may be able to apply for the interest-free Home Energy Scotland loan to help with the initial costs. To be eligible for the loan you must not start work on your system until you have received a written loan offer.  

Read our policy documents about the Smart Export Guarantee

 

Feed-in Tariff scheme

The Feed-in Tariffs (FITs) scheme closed to new applications on 31 March 2019.

Under FITs, householders receive payments for the electricity generated by eligible installed systems like solar PV, wind or hydro turbines, or micro CHP.

Important information about FITs closure and future applications

  • Householders that installed an eligible system and have already successfully applied for FITs payments are unaffected by the scheme closure.
  • Householders that have installed an eligible system with an MCS certificate dated on or before 31 March 2019 have until 31 March 2020 to apply to the scheme.
  • Householders that have not installed an eligible system on or before 31 March 2019 will not be eligible for FITs payments.

 Ofgem’s Feed-In Tariffs page and Ofgem’s FAQs on scheme closure have further information.

If you have installed an eligible system with an MCS certificate dated on or before 31 March 2019 and are considering applying for FITs payments before 31 March 2020, see our Feed-in Tariffs page for more information.

More information

Latest Ofgem tariffs

Read details of the latest and historical export tariff rates in the publications on Ofgem's website

Visit Ofgem

Government information

Read more details on FITs from the Department of Business, Energy and Industrial Strategy (BEIS).

Visit BEIS

Based in Scotland?

Call Home Energy Scotland for free, expert and impartial advice on 0808 808 2282, from Monday to Friday between 8am to 8pm and on Saturdays between 9am to 5pm.

Request a callback