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Smart Export Guarantee Coming in January 2020

George Riley 11 Jun 2019

On 10th June, the government finally announced the details of the Smart Export Guarantee (SEG), the system to ensure people are paid for excess generated electricity they send to the grid.

This guarantee is seen as a replacement for the Feed-in and Export Tariffs, which ended on 31st March this year. Those schemes encouraged thousands of installs and helped bring the cost of solar down over 50% since 2011. The aim of the SEG is to continue promoting renewables but without costing consumers. Instead suppliers will have to start bidding competitively for the energy you generate.

Smart Export Guarantee key facts

  • There is a legal obligation for energy suppliers with more than 150,000 customers (90% of the market) to introduce at least one export tariff by 1st Jan 2020.
  • There is no minimum tariff rate, but it must always be greater than zero.
  • Tariffs can be any form - flat, variable or smart (adjusting based on wholesale energy price).
  • It’s available for systems up to 5MW.
  • Systems will still need to be compliant with MCS and installed by an MCS certified installer (such as Spirit).
  • Exported power must be metered.

What happens in the meantime?

Any installs completed between the end of the Feed-in Tariff (31st March 2019) and the introduction of SEG (1st Jan 2020) will be eligible once the SEG is implemented, but there will be no retrospective payments for the period in between.

Some energy suppliers are already offering export payments, however, so you could sign up with one of them to take advantage for at least the hiatus time. Currently, the top offering is from Octopus Energy:

  • Outgoing Fixed tariff - 5.5p per kWh;
  • Outgoing Agile tariff - half-hourly prices that match day-ahead wholesale rates.

E.ON and Bulb are running trials for reimbursing solar customers.

How does this impact FiT payments?

If you’re already receiving payments from the Feed-in Tariff then you will not be eligible for the Smart Export Guarantee. You may, however, decide to opt out of the FiT and receive export payments under the SEG instead. It looks like you would only be able to opt out of FiT payments after 12 months (and then opt in/out once every 12 months after this point).

Is it worth waiting for the SEG to get panels installed?

If you choose not to go with one of the suppliers already offering export payments, how much might you lose in the meantime?

Say the system generates 4000kWh per year and we estimate 50% is exported. In the 6 months until the SEG comes in, you’d export 1000kWh for free. At the 5.5p rate Octopus is offering, this would be worth £55 - so not a very compelling reason to delay till next year! Particularly when you consider the potential VAT rise coming.

Find out more

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Topics: Tariffs, Solar PV

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