SEG & export

SEG vs Solar PPA: Feed-in and Export Options for UK Business

The Smart Export Guarantee pays you for the surplus solar you push back to the grid. A PPA does something different: it pays you in cheap on-site kilowatt-hours you never export. For most commercial sites the second number is far bigger.

What replaced the Feed-in Tariff: the SEG explained

For a decade the Feed-in Tariff (FiT) underpinned UK solar economics. It paid a generation tariff on every kilowatt-hour your panels produced, plus a separate export tariff, both index-linked and guaranteed for 20-25 years. The scheme closed to new applicants on 31 March 2019. Anything commissioned after that date earns nothing from FiT.

Its replacement is the Smart Export Guarantee (SEG), in force since 1 January 2020. The difference is fundamental. SEG pays you only for the electricity you export to the grid — there is no generation tariff for the units you use yourself. Every licensed supplier with 150,000+ domestic customers must offer at least one SEG tariff, but Ofgem sets no floor on the rate, so suppliers compete and the numbers vary widely.

To claim SEG your installation must be MCS-certified (or equivalent) up to 5MW, and you need an export-capable smart or half-hourly meter so the supplier can measure what actually flows back. For a commercial site that already runs half-hourly metering, the metering side is straightforward; the commercial question is whether export is the best home for your surplus at all.

Indicative 2026 SEG export rates

SEG tariffs fall into two broad shapes. Fixed (flat) tariffs pay one rate for every exported unit regardless of time of day — simple, predictable, and usually at the lower end of the range. Variable or agile tariffs track wholesale prices half-hour by half-hour, paying far more when the grid is short and very little (occasionally nothing) when it is awash with cheap renewables at midday — which is, unhelpfully, exactly when your solar exports most.

SEG tariff type	Indicative 2026 rate	Best for
Fixed / flat	~3–7 p/kWh	Sites wanting predictable export income with no admin
Variable / agile	~5–15 p/kWh at peak	Sites that can shift export away from midday or pair with a battery
Bundled (import+export deal)	Varies — often tied to import tariff	Sites switching supplier and negotiating both together

These are indicative market ranges, not quotes; SEG rates change frequently and differ by supplier and contract. The pattern to notice is the ceiling: even a good agile SEG rate at peak rarely beats the value of not buying a unit of grid power. That is the whole case for a PPA.

How a PPA handles export differently

A solar Power Purchase Agreement inverts the logic. Instead of pushing cheap solar onto the grid and being paid a few pence, a PPA is engineered so you consume the generation on site and pay a tariff well below grid import. You are not selling power — you are avoiding buying it at retail rates.

The arithmetic is decisive. A commercial off-taker typically imports at 28–32 p/kWh. A behind-the-meter PPA delivers solar at 8–14 p/kWh, and an in-front-of-meter PPA — which carries network use-of-system charges — at 13–22 p/kWh. Every unit you self-consume under a PPA is worth the gap between your import price and your PPA tariff: roughly 15-22p of avoided cost. Exporting that same unit under SEG returns a few pence at best.

So where does export fit in a PPA? On most sites generation and demand do not match perfectly — a factory shuts at weekends, a school empties in August. The surplus still has to go somewhere. In a well-drafted in-front-of-meter PPA the provider handles that export and the SEG revenue is captured, either retained by the SPV against your tariff or passed back to you. The point is that export becomes the residual, not the design goal. For a full breakdown of the per-structure tariff bands, see our PPA pricing benchmarks.

When to chase SEG and when to sign a PPA

The deciding factor is your daytime load profile — how much of the solar you can actually use as it is generated. The higher your self-consumption, the more a PPA outperforms export; the lower it is, the more SEG matters as a way to monetise surplus.

• High daytime load — sign a PPA. Factories, cold storage, food processors, hospitals on 24/7 base load, and retail with refrigeration self-consume most of their generation. Selling at SEG rates would waste the asset.
• Low or seasonal daytime load — SEG earns its keep. Schools generate hardest in July and August when classrooms are empty; seasonal hospitality, marinas and holiday parks peak in different months than their demand. Export revenue recovers value the building can't use.
• Mixed profile — a PPA that captures SEG. Most commercial sites sit between the two. An in-front-of-meter PPA self-consumes what you can and routes the rest to export, so you don't have to choose.

For a school weighing direct ownership against a contract, the calculus is different again: ownership keeps 100% of both the savings and the SEG income but requires capital and carries performance risk, whereas a PPA needs no capital and shifts that risk to the provider. The export question rarely changes that decision on its own.

Worked example: a 1MWp commercial array

Take a 1MWp rooftop system — the kind a tier-one manufacturer, large 3PL or NHS Trust might host. UK yield puts annual generation at roughly 950,000–1,050,000 kWh. Now compare the two routes for that output.

Route	Value per kWh	What it depends on
Export everything under SEG	~3–15 p/kWh	Supplier tariff; midday export often paid least
Self-consume under a PPA	~15–22 p/kWh avoided cost	Your grid import price (28–32p) minus PPA tariff (10–13p)

If a site self-consumes 80% of that 950 MWh under a PPA and exports the remaining 20%, the self-consumed portion carries the value — hundreds of thousands of pounds of avoided grid cost a year — while the exported slice tops it up at SEG rates. Flip the proportions for a low-load site and SEG starts to matter more, but the on-site value still leads wherever demand exists. This is why our Portsmouth PPA guide and every other location page frame solar as a procurement decision, not a feed-in scheme.

The headline answer to "how much could I sell my solar for?": as straight export, only a few pence a unit. As displaced grid import under a PPA, three to eight times more. The real money is in not buying, not in selling.

Getting an export and PPA position for your site

The right answer is site-specific. It turns on your half-hourly demand shape, your current import tariff, your roof or land area, and whether you occupy long enough to host a 15-25 year contract. A site that exports most of its generation should weigh SEG tariffs from several suppliers; a site that consumes most of it should be modelling a PPA, with export as the tidy-up on surplus.

We are an independent advisory and matching service — not a supplier, installer or broker. We explain the mechanics, set realistic tariff expectations, and introduce off-takers to vetted PPA providers for a disclosed referral fee. If you want a view on whether SEG, a PPA, or a PPA-with-export best fits your load profile, share your annual consumption and we'll model the comparison. Start with a no-obligation PPA quote or get in touch to talk it through.

FAQs

Frequently asked questions

Is the Feed-in Tariff still available in 2026?

No. The Feed-in Tariff closed to new applicants on 31 March 2019. Installations commissioned after that date earn nothing from FiT and instead rely on the Smart Export Guarantee for export income — though existing FiT contracts continue to run for their original 20-25 year term.

What is the difference between SEG and a solar PPA?

SEG pays you for surplus solar you export to the grid, typically a few pence per kWh. A PPA does the opposite: it lets you consume generation on site at 10–18p/kWh instead of importing at 28–32p/kWh. SEG monetises surplus; a PPA cuts your import bill, which is usually worth far more.

How much is the Smart Export Guarantee worth per kWh in 2026?

Indicative 2026 SEG rates run roughly 3–7p/kWh on fixed tariffs and up to about 15p/kWh on variable or agile tariffs at peak times. Suppliers set their own rates with no Ofgem-mandated floor, so it pays to compare offers and check whether midday export — when solar peaks — is paid well.

Can I claim SEG export payments while on a PPA?

Often yes. In an in-front-of-meter PPA the provider can capture SEG on the surplus you don't self-consume, either retaining it against your tariff or passing it back. The structure self-consumes what your site can use and exports the rest, so you benefit from both routes rather than choosing one.

Should a school chase SEG or sign a PPA?

It depends on the load profile. Schools generate most heavily in summer when buildings are empty, so SEG export income matters more than for a 24/7 industrial site. But over the full year a PPA's avoided import cost during term time usually still leads. The right answer comes from modelling your half-hourly demand.

How much could I sell my solar generation for?

A 1MWp array generates around 950,000–1,050,000 kWh a year. Sold purely as export under SEG that surplus is worth only a few pence per unit. Consumed on site under a PPA, each unit displaces 28–32p/kWh of grid import for a 10–13p PPA tariff — making self-consumption worth roughly four to eight times more than export.

Related on this site

• /mechanics/pricing/ — 2026 tariff bands by structure and system size
• /mechanics/in-front-of-meter-ppa/ — How export-and-import PPA structures work
• /mechanics/structure/ — On-site, sleeved, virtual and corporate PPAs
• /locations/portsmouth/ — Local commercial PPA guidance and tariffs
• /sectors/schools/ — Term-time load, summer export and funding routes
• /quote/ — Model SEG vs PPA for your site