Selling electricity back to the grid: price per kWh

Selling surplus electricity generated from your home back to the National Grid can significantly offset your energy costs and contribute to a greener energy system. The Smart Export Guarantee (SEG) is the UK government-backed scheme that enables homeowners with microgeneration systems, such as solar panels, to get paid for the electricity they export. This guide explains how the SEG works, what you can expect to earn, and the steps to maximise your payments.

If you're generating your own electricity and looking to get paid for what you export, Fuse Energy offers a clear and competitive export tariff. We make it simple to understand your earnings and manage your energy. Click here to switch to Fuse Energy today.

What is the Smart Export Guarantee (SEG)?

The SEG is a government initiative launched on 1 January 2020, designed to ensure that small-scale low-carbon electricity generators are paid for the electricity they export to the grid. This scheme mandates that larger energy suppliers offer tariffs to pay customers for each kilowatt-hour (kWh) of electricity they export. All licensed electricity suppliers with at least 150,000 domestic customers are required by Ofgem to offer at least one SEG tariff.

How SEG works

If your home generates more electricity than you use at any given time, the surplus is automatically fed into the National Grid. Under the SEG, your energy supplier pays you for this exported electricity. Payments are based on a per-kWh rate, which varies between suppliers and tariffs. To participate, you generally need a certified microgeneration system and a smart meter capable of recording half-hourly export readings.

SEG vs Feed-in Tariff (FiT)

The SEG replaced the Feed-in Tariff (FiT) scheme, which closed to new applicants on 31 March 2019. While both schemes aimed to encourage renewable energy generation, they operate differently. The FiT scheme offered guaranteed payments for both generation and export, often at higher rates, and was a government subsidy. The SEG, however, is a market-based mechanism where energy suppliers compete to offer export tariffs. This means rates can fluctuate more, and it's crucial to compare options to find the best deal.

Current price per kWh for exported electricity

The price you can receive per kWh for exported electricity under the SEG varies considerably. SEG tariffs typically range from around 1p to over 20p per kilowatt-hour (kWh) in 2026. These rates are set by individual energy suppliers, and they can change over time.

Factors influencing SEG rates

Several factors influence the SEG rates offered by suppliers:

• Supplier competition: As suppliers compete for customers, they may offer more attractive rates.
• Wholesale electricity prices: The value of exported electricity is often linked to wholesale market prices, which can be volatile.
• Tariff structure: Some tariffs offer a flat rate, while others might have variable rates depending on the time of day or grid demand.
• Customer relationship: Some suppliers offer better SEG rates to their existing electricity import customers.

Comparing SEG tariffs

Comparing SEG tariffs is essential to maximise your earnings. Don't assume your current energy supplier offers the best export rate. Look at:

• The pence per kWh rate: This is the most direct measure of how much you'll earn.
• Payment frequency: Some suppliers pay monthly, quarterly, or annually.
• Eligibility requirements: Check if the tariff requires you to be an import customer with the same supplier or if it's open to all.
• Terms and conditions: Understand any clauses regarding minimum export, contract length, or changes to rates.

Eligibility and requirements for SEG

To qualify for SEG payments, your microgeneration system and property must meet specific criteria.

Microgeneration Certification Scheme (MCS)

A key requirement for SEG eligibility is that your microgeneration system must be certified under the Microgeneration Certification Scheme (MCS) . MCS is an industry standard that ensures your installation meets high quality and safety standards. This certification provides assurance that your system is installed correctly and efficiently. Systems with a total installed capacity of 5 megawatts (MW) or less, or 50 kilowatts (kW) for micro-combined heat and power (micro-CHP) systems, are eligible.

Smart meter requirements

You will generally need a smart meter capable of providing half-hourly export readings. This allows your energy supplier to accurately measure the amount of electricity you export and calculate your payments. If you don't have a smart meter, your chosen SEG supplier may arrange for one to be installed. You can learn more about the benefits of a smart meter installation for tracking your energy usage.

Understanding your export MPAN

An MPAN (Meter Point Administration Number) is a unique 21-digit reference number that identifies your electricity supply point. Just as you have an MPAN for the electricity you import, you also need a separate export MPAN for the electricity you send back to the grid. This export MPAN is crucial for your SEG payments, ensuring your exported energy is correctly registered and attributed to your property.

How to sell your electricity back to the grid

The process of selling your electricity back to the grid involves several steps, from ensuring your system is certified to applying for a SEG tariff.

Step-by-step application process

1. Ensure MCS certification: Verify that your microgeneration system (e.g., solar panels) is MCS certified. This is a fundamental requirement for SEG eligibility.
2. Install a smart meter: If you don't already have one, arrange for a smart meter capable of half-hourly export readings to be installed. Your chosen SEG supplier can often facilitate this.
3. Obtain an export MPAN: You will need a unique export MPAN for your system.
4. Research and compare tariffs: Look at the SEG tariffs offered by different suppliers. Pay close attention to the pence per kWh rate, payment terms, and any specific eligibility criteria.
5. Apply for your chosen SEG tariff: Once you've selected a tariff, apply directly with that supplier. You'll need to provide details of your MCS certificate, export MPAN, and smart meter.
6. Monitor and switch: Keep an eye on your export and earnings. The SEG market can change, so be prepared to switch tariffs if a better option becomes available.

Navigating export MPAN generation and energisation

Getting an export MPAN is a critical step. If you don't have an export MPAN, Fuse Energy can assist you with the generation process. This involves Fuse forwarding your DNO connection approval (G98/G99 paperwork) and MCS certificate to your Distribution Network Operator (DNO) to generate the export MPAN. It's important to note that while Fuse can help generate the MPAN, it will be a non-energised 'shell'. You will need to initially energise this export MPAN with another supplier before you can switch your export tariff to Fuse Energy. This ensures your system is fully registered and ready for payments.

Switching SEG suppliers

You are not tied to your import electricity supplier for your SEG tariff. You can switch your SEG supplier independently to find the best export rate. This flexibility allows you to continuously seek out the most competitive offer for your exported electricity.

Maximising your export earnings

Beyond choosing the best tariff, there are strategies you can employ to increase the amount of electricity you export and, consequently, your earnings.

Optimising your energy use and storage

• Shift consumption: Use high-energy appliances (washing machine, dishwasher) during daylight hours when your solar panels are generating electricity. This reduces the amount of electricity you need to import and increases your surplus for export.
• Install a battery storage system: A home battery allows you to store excess electricity generated during the day instead of exporting it immediately. You can then use this stored energy in the evening, reducing your import from the grid, or export it during peak demand times if your tariff offers higher rates.
• Monitor your generation and consumption: Use smart meter data and energy monitoring apps to understand your energy patterns. This insight can help you make informed decisions about when to use or store your electricity. Understanding your energy bill can also help you identify consumption patterns.

The future of energy export in the UK

The energy landscape in the UK is continually evolving, with a growing emphasis on renewable generation and smart grid technologies. As more homes adopt microgeneration systems and battery storage, the dynamics of energy export are likely to become even more sophisticated. Future developments may include more dynamic export tariffs that respond to real-time grid demand, offering even greater opportunities for homeowners to earn from their surplus electricity.

By understanding the SEG, meeting the eligibility requirements, and actively managing your export, you can make the most of your home's renewable energy generation.

Fuse Energy empowers homeowners to make the most of their surplus energy. Our transparent approach and digital-first experience through the Fuse app make it easy to monitor your energy export and earnings. We provide clear guidance on the often-complex process of obtaining and energising an export MPAN, even if it involves an initial step with another supplier. Discover how simple it can be to manage your energy and contribute to a greener future. Click here to switch to Fuse Energy today.