FiT vs SEG: Which Pays You More for Exporting Solar Power?

The Feed-in Tariff (FiT) and the Smart Export Guarantee (SEG) are not live alternatives you can choose between, one closed to new applicants in April 2019, and the other is the current framework for anyone installing solar today. The confusion between them is widespread, and it matters, because homeowners forming expectations about export income based on FiT-era figures will find the reality of SEG significantly different. 

This article explains which scheme applies to your situation, how the two compare structurally, and why the more financially significant decision is not which export rate you receive, but how much of your solar generation you use on-site.

Power your home with Upvolt’s smart solar solutions.

Key Takeaways

• The Feed-in Tariff closed to new applicants in April 2019; homeowners installing solar today enter the Smart Export Guarantee, which is an entirely separate scheme with a different structure and no government-set rate above 0p/kWh.
• SEG rates are set by individual suppliers and vary considerably, Ofgem requires eligible suppliers to offer a tariff but does not guarantee a meaningful rate, meaning export income is variable and can be withdrawn or changed at any point.
• The primary financial benefit of solar is self-consumption: each unit of solar electricity used on-site avoids a grid purchase at import rates that are structurally higher than current SEG export prices, making avoided cost the stronger financial case.
• Battery storage increases self-consumption by storing generation that would otherwise be exported at lower SEG rates, and for many households this shift from export to on-site use improves overall payback more than optimising for the highest available SEG tariff.

Two Schemes, Two Very Different Situations

The Feed-in Tariff closed to new applicants in April 2019; any homeowner installing solar today registers for the Smart Export Guarantee instead. These are not competing options, they apply to different groups of people at different points in time, and it is not possible to choose between them.

Quick Answer

• Installed solar before April 2019 ? you may be on an active FiT contract, and payments continue until that contract ends.
• Installing solar now ? you enter the SEG framework; FiT is not available to you.

Who Is Still on the Feed-in Tariff?

Homeowners who installed solar before the FiT closed are still receiving payments under their original grandfathered contracts. FiT contracts were typically structured over 20 or 25 years, so many recipients have years of payments remaining. Those contracts continue to run to their natural end, and recipients do not need to take any action unless their contract term expires, their licensed FiT provider exits the scheme, or they substantially modify their solar installation. FiT recipients are not eligible to transfer to SEG while their FiT contract is active, and in most cases doing so would not be financially beneficial given the rate difference.

Who Falls Under the Smart Export Guarantee?

SEG applies to all new solar installations completed after the FiT’s closure period. To be eligible, your installation must be certified under the Microgeneration Certification Scheme (MCS), and you must have a smart meter or an export meter capable of recording the volume of electricity you send to the grid. Unlike the FiT’s deemed export approach, SEG pays only on what is actually metered as exported, there is no estimated allowance. Your installer handles MCS documentation as part of the installation process; you then register for a SEG tariff directly with your chosen eligible supplier.

How the Feed-in Tariff Worked

The FiT was structured around three distinct payment components: a generation tariff paid on all electricity produced, an export tariff paid on surplus sent to the grid, and an indexation mechanism that linked both rates to the Retail Price Index. Understanding how it was built helps explain why FiT recipients receive amounts that appear very high compared with current SEG rates, the schemes are not equivalent and were never designed to be.

You can find the full scheme history via the official SEG page.

Generation Tariff, Export Tariff, and Deemed Export

The generation tariff paid a fixed rate per unit of electricity generated by the solar panels, regardless of whether that electricity was consumed on-site or sent to the grid. This payment alone provided income for all generation, not just the surplus. The export tariff then paid an additional rate on the electricity actually exported, or, under the deemed export provision, on an assumed 50% of total generation without requiring a meter to record actual exports. For large systems under the deemed approach, this was particularly generous: a household might receive export payments on units it had actually consumed on-site. Both tariffs were fixed at the time of installation and linked to the Retail Price Index (RPI), providing predictable, inflation-protected income over the contract term.

Why FiT Payments Were Significantly Higher Than SEG Rates

The government deliberately set FiT generation tariffs at high levels to incentivise early adoption when solar installation costs were substantially greater than they are today. Homeowners who installed in 2010 and 2011 received generation tariffs of around 41 to 43p/kWh under the scheme’s initial rates. Those rates declined progressively as installation costs fell and the scheme matured, but the structure of fixed, indexed payments remained. 

This combination, generation payments on all output plus export income on top, is what made FiT recipients’ total income so significantly higher than what SEG produces. The comparison is not between two equivalent export rates; it is between two fundamentally different scheme designs.

How the Smart Export Guarantee Works

The SEG was introduced to ensure that new solar owners receive some payment for electricity exported to the grid, rather than sending it for nothing. For a fuller picture of the payment mechanism, the guide to how UK homes get paid for solar exports covers the framework in detail. The critical point, one that many articles handling this topic get wrong, is that the SEG does not guarantee a meaningful rate. It guarantees only that eligible suppliers must offer a tariff.

What Ofgem Requires, and What It Does Not

Ofgem requires suppliers with more than 150,000 domestic customers to offer a SEG tariff to eligible solar owners. However, Ofgem sets the minimum rate at 0p/kWh. This means a supplier is technically compliant with the SEG obligation even if it offers a rate of zero. In practice, competitive pressure has meant that most eligible suppliers offer rates above this floor, but those rates are set entirely by the market, not by government. 

They can change, they can be withdrawn, and they vary considerably between suppliers. Homeowners should treat SEG income as a variable secondary benefit rather than a fixed financial commitment, and compare available rates before selecting a supplier.

SEG Eligibility Requirements

SEG registration requires an MCS-certified installation, a smart meter or eligible export meter, and registration with an SEG-licenced supplier. The smart meter requirement is an important distinction from the old FiT: there is no deemed export allowance under SEG, so if the meter cannot record actual export volumes, payments cannot be calculated. Most modern installations are paired with smart meter arrangements as standard, but it is worth confirming this at the point of installation. Your installer will provide the MCS certificate; choosing a SEG supplier and completing registration is then the homeowner’s responsibility.

FiT vs SEG, A Direct Comparison

The two schemes differ across almost every structural dimension, in what they pay on, how the rate is set, how long it lasts, and what certainty it provides. For homeowners weighing whether to export or store surplus, the guide to exporting or storing your solar power models that trade-off in detail. The table below summarises the key differences.

The financial implication is direct: FiT recipients receive structured, inflation-linked income on all generation, while SEG recipients receive a market-rate payment only on the fraction of generation actually sent to the grid. For a new solar installation, the SEG rate is not the primary financial lever, it is a modest additional benefit on surplus that would otherwise go to the grid unpaid.

Why Self-Consumption Matters More Than Export Income

Each unit of solar electricity consumed on-site avoids a grid purchase at import rates that are currently and structurally higher than most SEG export prices. That arithmetic, not the export rate itself, is the primary financial engine of solar returns.

The Arithmetic of Export vs Avoided Cost

When you export a unit of electricity under a typical SEG tariff, you receive a payment in the range of 3 to 15p/kWh depending on your supplier and tariff. When you use that same unit on-site, you avoid purchasing electricity from the grid at import rates that are currently significantly higher per unit. The avoided cost per unit is therefore worth more than the export income per unit, often by a factor of two or more. This structural gap means that any system configuration or behavioural change that shifts generation from export to on-site use, whether through timing large appliances during peak solar hours or adding battery storage, delivers greater financial benefit than selecting the highest available SEG tariff.

Battery Storage and Its Effect on Self-Consumption

Adding a battery to a solar system stores generation that would otherwise be exported during peak solar hours and makes it available later in the day when the panels are no longer generating. This increases the proportion of generation consumed on-site rather than sold at SEG rates, and in doing so, it compounds the financial benefit: more avoided grid purchases at higher import rates, and less surplus exported at lower export rates. 

Industry evidence suggests that battery storage can significantly increase a household’s self-consumption ratio, though the actual improvement depends on household size, occupancy patterns, and system sizing. For homeowners evaluating whether this trade-off is financially justified, the guide to whether battery storage is worth adding to your solar system sets out the assessment in detail.

What This Means If You Are Considering Solar Now

SEG income is a real benefit, it means surplus generation produces some return rather than going to the grid for nothing. However, it should not be the primary reason to install solar, and homeowners who design a system around maximising export are unlikely to achieve the financial returns that self-consumption-focused systems deliver.

For households with low daytime occupancy, where much of the solar generation falls during hours when nobody is home to use it, export income becomes proportionally more relevant. But even in this scenario, battery storage is typically worth evaluating, because the financial case for storing surplus at home and using it in the evening is usually stronger than exporting it at current SEG rates. 

The right answer depends on your usage profile and system size, not on which SEG tariff is currently the highest. Understanding how export rates interact with overall returns is important for anyone at the research stage, the guide to how export rates affect solar return on investment covers this relationship clearly.

The practical steps for anyone installing solar now are straightforward: ensure the installation is MCS-certified (a legal requirement for SEG eligibility, not an optional extra), confirm smart meter arrangements before installation, and compare available SEG tariffs from eligible suppliers once the system is live. System design, size, orientation, and whether battery storage is included, will have a far greater influence on your overall financial return than which SEG rate you select.

How Upvolt Helps Homeowners Understand Their Export and Self-Consumption Options

Homeowners asking about FiT and SEG are usually asking a deeper question: is solar financially worth it, and what can I realistically expect to earn or save? Starting the answer with export rates alone produces a misleading picture. A complete financial assessment starts with how much of your generation you are likely to use on-site.

Modelling Self-Consumption Before Recommending a System

Before recommending a system size or configuration, Upvolt assesses occupancy patterns, existing energy usage, roof orientation and shading, and how these factors combine to determine what proportion of generation will be self-consumed versus exported. In our experience, this modelling step consistently changes the system recommendation, particularly around whether battery storage adds meaningful value for a given household’s usage profile. 

A household that is home throughout the day has a very different self-consumption picture from one where the property is empty from 8am to 6pm, and the financial case for battery storage shifts accordingly.

Designing for Financial Return, Not Export Headlines

Upvolt installs MCS-certified systems sized around each household’s actual consumption rather than around a target system size or headline export rate. Battery storage options are evaluated on their financial merit relative to current SEG rates and grid import prices for that specific household, not as a default addition. What we typically see on site is that the homes where solar delivers the strongest returns are those where system design was driven by consumption data, not by the desire to maximise generation capacity or export volume.

Transparency on Export Income Expectations

Before committing to an installation, Upvolt provides a clear picture of likely SEG income, self-consumption savings, and overall payback timeline, all qualified by the household’s specific usage pattern and system design. SEG income is presented as the secondary benefit it is, not as a headline figure. Payback timelines are expressed as ranges that reflect realistic assumptions about usage and grid prices rather than best-case projections.

Let’s Recap

The Feed-in Tariff and the Smart Export Guarantee are not interchangeable options and never were. FiT is a closed scheme that continues only for homeowners who installed solar before April 2019 and remain on their original contracts. SEG is the current framework for all new installations, but unlike FiT it carries no government-set rate above 0p/kWh and no fixed income guarantee. The two schemes differ in what they pay on, how the rate is set, and how much certainty they provide, making direct financial comparisons between them misleading for anyone trying to assess a new solar installation today.

For homeowners installing solar now, SEG income is a secondary financial consideration. The primary case for solar rests on self-consumption: each unit of generated electricity used on-site avoids a grid purchase at import rates that are structurally higher than current export prices. The arithmetic consistently favours self-consumption over export, which means system design choices that increase the proportion of generation used on-site, including the timing of appliance use and the potential addition of battery storage, matter more to overall financial returns than optimising for the highest available SEG tariff.

Battery storage changes the financial picture further by shifting generation that would otherwise be exported at lower rates into on-site use at higher avoided-cost rates. For households with low daytime occupancy, the case for battery storage may be less immediately obvious, but the trade-off between stored use and exported income is typically favourable when assessed against realistic import and export prices. The financially significant decision is not which SEG supplier to choose, it is how the system is designed and whether storage is included.

Homeowners who installed solar before 2019 and are receiving FiT payments should understand that their contracts continue to run to their natural end, and that no action is required unless their contract term expires, their provider exits the scheme, or they modify their system in a way that affects their contract status. When an existing FiT contract does expire, SEG then becomes the relevant framework for any ongoing export payments.

About Upvolt

Upvolt is a renewable energy installer operating across southern England, specialising in residential solar panels, battery storage, and integrated home energy systems. Upvolt works with homeowners at every stage of the research and installation process, from early financial modelling through to commissioning and handover.

Homeowners asking about FiT and SEG are typically at the research stage, trying to establish whether solar is financially sound before committing to an installation. Upvolt’s approach begins with a full financial assessment rather than a headline system proposal: self-consumption ratios are modelled against the household’s actual usage profile, and battery storage is evaluated on whether it adds measurable financial value for that specific home. Export income is presented clearly, as a secondary benefit qualified by current market rates, rather than as a primary selling point.

Where solar installations include battery storage, Upvolt’s Skygate® energy management system provides ongoing monitoring of generation, self-consumption, and export, allowing homeowners to track the financial return from both schemes in real time.

MCS certification is a legal requirement for SEG eligibility, without it, a solar installation does not qualify for export payments. Upvolt’s MCS-certified operating companies meet this requirement as a matter of compliance, not as a point of distinction. For homeowners, this means that an Upvolt installation produces the documentation needed to register for a SEG tariff as a standard part of the process.

If you want a clear financial picture before committing, including how much you are likely to self-consume, what SEG income you can realistically expect, and whether battery storage makes sense for your home, book a free solar assessment.

FAQ

Can I Still Sign Up to the Feed-in Tariff If I Install Solar Now?

The Feed-in Tariff closed to new applicants in April 2019 and is not available to homeowners installing solar today. Any installation completed after that date falls under the Smart Export Guarantee instead. Existing FiT recipients continue receiving payments under their original contracts, but those contracts cannot be transferred or opened by new applicants.

How Much Will I Receive Under the Smart Export Guarantee?

SEG rates are set by individual suppliers and vary, there is no government-guaranteed minimum above 0p/kWh. In practice, rates have historically ranged from around 3p to 15p/kWh depending on the supplier, but these figures can change and are not fixed at the point of installation. Comparing available rates across eligible suppliers before registering is the most reliable way to identify a favourable tariff at any given time.

Does My System Need a Smart Meter to Receive SEG Payments?

SEG eligibility requires a smart meter or an export meter capable of recording the volume of electricity actually sent to the grid. Unlike the FiT’s deemed export provision, which estimated 50% of generation as exported without requiring a meter, SEG is based on metered data only. Your installer will confirm meter requirements during the installation process, and your chosen SEG supplier will advise on any specific registration conditions.

If I Am Already on a FiT Contract, Should I Switch to SEG?

Homeowners receiving FiT payments under an existing contract cannot switch to SEG while that contract is active, and the financial case for doing so would rarely be positive, FiT rates, particularly for early installations, are considerably higher than current SEG market rates. FiT contracts run for their full term unless the homeowner substantially modifies their installation. When a FiT contract does eventually expire, SEG then becomes the relevant framework for any ongoing export payments.

Will Adding a Battery Affect My SEG Payments?

Adding a battery does not disqualify a homeowner from SEG, but it changes how much electricity reaches the grid. More generation is stored for on-site use rather than exported, which typically reduces the total volume of electricity sent to the grid and therefore reduces absolute SEG income. The financial trade-off is generally favourable, however, stored electricity displaces grid purchases at higher import rates, which usually produces a greater financial benefit than the export income it replaces. Whether this balance holds for a specific home depends on usage patterns and system sizing.

Alex Lomax

CEO & Co-Founder

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