Smart Export Guarantee (SEG) Explained: Getting Paid for Solar
TLDR: The Smart Export Guarantee requires energy suppliers to pay for solar electricity you export. Rates range from 4p/kWh (basic) to 15p/kWh (Octopus Outgoing Fixed). You need MCS-certified panels, a smart meter, and an account with a participating supplier. Annual earnings run £100-£500 depending on system size and export tariff chosen. This guide explains exactly how to maximise your income from exported solar.
Understanding the Smart Export Guarantee
The Smart Export Guarantee (SEG) is Ofgem-regulated scheme that requires licensed electricity suppliers with 150,000 or more customers to offer export tariffs to small-scale renewable generators. In plain English: if you have solar panels and export electricity to the grid, your supplier must pay you for it.
The SEG replaced the old Feed-in Tariff (FiT) in January 2020. The key difference? Under the FiT, rates were government-guaranteed and generous—sometimes over 20p/kWh. Under the SEG, suppliers set their own rates, which can vary enormously.
Why the SEG Matters
Without an export tariff, any electricity your solar panels produce that you don't use immediately is given to the grid for free. That's a terrible deal. Even at the lowest SEG rates, you're getting paid something for electricity that would otherwise be worthless to you.
More importantly, the difference between the worst and best SEG rates is substantial—the best-paying tariffs offer 3-4 times more than the worst. Choosing the right supplier can add hundreds of pounds to your annual income.
Real UK Homeowner Experiences
Mark and Lisa, Oxfordshire (6kW system installed 2023): "We had no idea about the SEG when we first got our panels. Our installer mentioned it but we never got round to signing up. For eight months, we were exporting about 200 kWh a month for nothing. When we finally registered with Octopus on their Outgoing Fixed at 15p/kWh, we started earning £30 a month. That's £360 a year we'd been throwing away. Lesson learned—sign up immediately."
Catherine, Suffolk (4kW system installed 2021): "I was with British Gas for my export payments, getting about 5p/kWh. I assumed all suppliers paid roughly the same. A friend mentioned Octopus and I switched—took about ten minutes online. My export payments went from £100 a year to nearly £300. Same panels, same export, triple the income. I wish I'd looked into it sooner."
Robert, Northamptonshire (8kW system with 10kWh battery): "We went with Octopus Flux because it rewards you for exporting during peak hours. Our battery charges from solar during the day, then we export between 4-7pm when the rate is highest—up to 25p/kWh sometimes. We're earning about £45 a month in export payments, plus avoiding buying expensive peak electricity. The system has optimised itself around the Flux tariff structure. Genuinely impressive how well it works."
Helen and David, Devon (3.5kW system, no battery): "We're retired so we're home during the day and use more of our solar directly. We only export about 40% of what we generate. Even so, with Octopus Outgoing Fixed at 15p/kWh, we get about £180 a year in export payments. It's not life-changing money, but it pays for our Christmas food shop. Every little helps."
Current SEG Rates (December 2024)
Export rates vary significantly between suppliers. Here's the current landscape:
Fixed Rate Tariffs
| Supplier | Tariff Name | Export Rate | Payment Frequency | Notes |
|---|---|---|---|---|
| Octopus Energy | Outgoing Fixed | 15.0p/kWh | Monthly | Best fixed rate available |
| Octopus Energy | Outgoing Variable | 12.0p/kWh (current) | Monthly | Rate adjusts quarterly |
| EDF | Export SEG | 4.6p/kWh | Quarterly | Basic rate, easy signup |
| British Gas | Export SEG | 5.6p/kWh | Quarterly | Existing customers only |
| E.ON Next | Next Export | 4.1p/kWh | Quarterly | Lowest major supplier rate |
| OVO Energy | Export | 5.0p/kWh | Quarterly | Standard SEG rate |
| Shell Energy | Export Fixed | 5.5p/kWh | Quarterly | Available to all |
| Scottish Power | Export | 4.5p/kWh | Quarterly | Standard rate |
| Utility Warehouse | Export | 5.0p/kWh | Quarterly | Members only |
Time-of-Use and Variable Tariffs
| Supplier | Tariff | Export Rates | Best For |
|---|---|---|---|
| Octopus Energy | Agile Outgoing | Variable (avg 8-18p, peaks to 50p+) | Battery owners timing exports |
| Octopus Energy | Flux | Peak: 20-25p, Off-peak: 7-12p | Battery + solar, peak export |
| Octopus Energy | Cosy | 12p standard, time-varying | Heat pump households |
| Social Energy | Smart Export | Variable (4-12p typical) | Basic variable option |
How Much Can You Actually Earn?
Your SEG income depends on three factors: system size, self-consumption rate, and export tariff. Let's run the numbers for typical scenarios.
Export Income by System Size
| System Size | Annual Generation | Typical Export (50%) | At 5p/kWh | At 12p/kWh | At 15p/kWh |
|---|---|---|---|---|---|
| 3kW | 2,700 kWh | 1,350 kWh | £68 | £162 | £203 |
| 4kW | 3,600 kWh | 1,800 kWh | £90 | £216 | £270 |
| 5kW | 4,500 kWh | 2,250 kWh | £113 | £270 | £338 |
| 6kW | 5,400 kWh | 2,700 kWh | £135 | £324 | £405 |
| 8kW | 7,200 kWh | 3,600 kWh | £180 | £432 | £540 |
| 10kW | 9,000 kWh | 4,500 kWh | £225 | £540 | £675 |
The difference is stark. A 5kW system earns £113 at basic SEG rates versus £338 on Octopus Outgoing Fixed—a £225 difference annually, just for choosing the right supplier.
Impact of Battery Storage
Battery storage changes the calculation. With a battery, you can:
- Store solar for evening use, reducing export volume but increasing self-consumption value
- Time exports for peak rate periods on variable tariffs
- Charge from cheap grid overnight and export during expensive peak hours
| Setup | Export Rate | Annual Export | SEG Income | Grid Savings (from stored solar) | Total Benefit |
|---|---|---|---|---|---|
| 5kW solar, no battery (50% export) | 15p fixed | 2,250 kWh | £338 | - | £338 |
| 5kW + 5kWh battery (30% export) | 15p fixed | 1,350 kWh | £203 | £216 (900 kWh @ 24p avoided) | £419 |
| 5kW + 10kWh battery (20% export) | Flux (peak) | 900 kWh | £180-£225 | £324 (1,350 kWh @ 24p avoided) | £504-£549 |
With a battery, reduced export can actually increase total value—you're trading export income for grid savings, which are often worth more per kWh.
Eligibility Requirements
To receive SEG payments, you must meet these Ofgem-mandated criteria:
1. MCS Certification
Your solar installation must be certified under the Microgeneration Certification Scheme (MCS). This means:
- Your installer must be MCS-certified
- The equipment (panels, inverter) must be MCS-approved
- The installation must meet MCS installation standards
- You receive an MCS certificate upon completion
Virtually all professional solar installers in the UK are MCS-certified. If your installer isn't, reconsider—they won't provide the certificate you need for SEG (and may not meet safety standards).
2. Smart Meter
You need a smart meter capable of measuring electricity exports in half-hourly intervals. Most modern smart meters do this, but some older "SMETS1" meters may not be compatible with all suppliers.
Smart meter installation is free from your electricity supplier. If you don't have one, request installation before or alongside your solar installation. It typically takes 2-4 weeks to arrange.
3. System Size
The SEG covers installations up to 5MW. All residential systems comfortably qualify—even a large 10kW domestic system is 0.01MW.
4. Eligible Technology
The SEG covers:
- Solar photovoltaic (PV) panels
- Wind turbines (under 5MW)
- Micro combined heat and power (CHP)
- Hydroelectric (under 5MW)
- Anaerobic digestion (under 5MW)
Most domestic applicants have solar PV. The process is identical regardless of technology.
Step-by-Step: How to Sign Up
Step 1: Gather Your Documents
You'll need:
- MCS certificate (from your installer)
- MPAN number (your electricity meter point—on your bill)
- Smart meter serial number
- Proof of address
- Bank details for payment
Step 2: Choose Your SEG Supplier
You don't need to buy electricity from your SEG supplier. You can have:
- One company for import (buying electricity)
- A different company for export (selling electricity)
For most people, Octopus Energy offers the best export rates regardless of who supplies their import electricity.
Step 3: Apply Online
For Octopus (recommended):
- Go to octopus.energy/outgoing
- Create an account or log in
- Upload your MCS certificate
- Enter your meter and bank details
- Choose your export tariff (Outgoing Fixed is usually best)
- Submit application
Processing typically takes 1-2 weeks. Once approved, payments begin automatically based on your smart meter readings.
Step 4: Monitor and Optimise
Most SEG suppliers provide an app or online dashboard showing:
- Daily/monthly export volumes
- Payment amounts and history
- Export patterns by time of day
Use this data to understand your export patterns. If you're exporting heavily during valuable peak hours, consider time-of-use tariffs for even better returns.
Maximising Your SEG Income
1. Choose the Best Export Tariff
This is the single biggest lever. Switching from a 5p/kWh tariff to 15p/kWh triples your income with zero effort beyond the initial switch. Check rates annually—the SEG market is competitive and rates change.
2. Time Your Energy Use
Without a battery, your best strategy is to use heavy appliances when the sun isn't shining. Run dishwashers, washing machines, and tumble dryers in the evening. This maximises daytime export while still using solar indirectly (lower bills offset the electricity you buy later).
3. Add Battery Storage
A battery fundamentally changes the equation. With smart tariff integration (particularly Octopus Flux), you can:
- Store solar during the day
- Export during peak pricing (4-7pm, up to 25p/kWh)
- Use stored solar for evening consumption
- Charge from cheap overnight grid if battery is empty
This "time-shifting" can increase total value by 50-100% compared to unoptimised export.
4. Consider Agile Export
Octopus Agile Outgoing pays variable rates based on wholesale electricity prices. Rates can spike to 30-50p/kWh (or higher) during periods of grid stress—typically winter evenings when demand peaks.
Without a battery, you can't really exploit Agile—solar generation is low when Agile rates are highest (dark evenings). But with battery storage, Agile export can be extremely lucrative.
Frequently Asked Questions
Q: Can I switch SEG suppliers?
A: Yes, anytime with no notice period or exit fees. The SEG is designed to be competitive—you can switch as often as rates change. Many people switch annually to chase the best rates.
Q: Do I need to be with the same company for import and export?
A: No. This is a common misconception. You can buy electricity from British Gas while exporting to Octopus. The meters are the same, but the commercial relationships are separate. Many people stay with their existing import supplier while signing up with Octopus purely for export.
Q: What if I don't have a smart meter yet?
A: You need one for SEG. Request installation from your electricity supplier—it's free and usually takes 2-4 weeks to arrange. Some solar installers can coordinate this as part of your installation package.
Q: I'm on the old Feed-in Tariff. Do I get SEG too?
A: If you're receiving FiT export payments (either metered or deemed), you continue on that scheme until it ends. You can't claim both FiT and SEG for the same installation. However, if you opted out of FiT export or never registered for it, you can switch to SEG. Contact your FiT administrator for advice specific to your situation.
Q: What about battery storage and SEG eligibility?
A: You can claim SEG for electricity exported from battery storage, as long as the original source is renewable (solar). There's no requirement for electricity to be exported immediately—stored and later exported solar is treated the same as direct export.
Q: How are payments calculated and when do I get paid?
A: Your smart meter records half-hourly export data, which your SEG supplier uses to calculate payments. Octopus pays monthly; most other suppliers pay quarterly. Payments are based on actual metered export, not estimates.
Q: Is SEG income taxable?
A: For most domestic installations, SEG income is not taxable. HMRC treats it as a return on your solar investment rather than trading income. However, if you're running a business generating solar electricity, different rules may apply. Consult a tax adviser if unsure.
The Bottom Line
The Smart Export Guarantee turns surplus solar electricity into cash. At basic rates, you might earn £100-£150 annually from a typical system. At the best rates (Octopus Outgoing Fixed at 15p/kWh), that same system earns £300-£400.
The key insight: SEG income is "found money" for electricity you'd otherwise give away for free. The signup process takes 15-20 minutes. The rate difference between best and worst suppliers is worth hundreds of pounds annually. There's no good reason to stay on a poor tariff or not sign up at all.
For most solar owners, Octopus Outgoing Fixed at 15p/kWh is the right choice—simple, predictable, and the highest fixed rate available. If you have battery storage and are comfortable with variable pricing, Flux or Agile Outgoing can push returns even higher through strategic peak-time export.
Don't leave money on the table. If you have solar panels and haven't signed up for SEG, do it today. If you're on a low-paying SEG tariff, switching takes minutes and costs nothing. Your solar panels are working hard—make sure you're getting paid fairly for every kilowatt-hour they produce.