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On the 31st of March 2019 all subsidies for Solar PV were removed. This move by the government has resulted in many domestic households with Solar PV providing electricity to the grid without compensation. The government have responded to this situation with the planned introduction of the Smart Export Guarantee (SEG) tariff.

From the 1st of January 2020 all electricity suppliers that serve more than 150,000 domestic customers will be required to offer at least one SEG tariff. Currently, the Department of Business, Energy, & Industrial Strategy (BEIS) have mandated that under the compulsory SEG tariff a supplier must offer compensation for all exported electricity from domestic microgeneration. The contracts currently have no minimum term but the positive payment requirement will remain fixed. The effectiveness of the scheme will be reviewed on an annual basis by BEIS and terms adjusted as appropriate. The Government’s hope is that commercial competition will drive the rate paid by suppliers to a reasonable market price beyond the minimum mandated.

Officially SEG tariffs will not be introduced until 2020. However, the industry is already seeing suppliers begin to offer SEG-like tariffs in an attempt to establish themselves and gain a competitive edge over rivals. At the time of writing, there are three suppliers offering these types of tariffs; Bulb, Eon and Octopus. It is understood that Bulb and Eon are offering restricted trials but Octopus are offering a payment of 5.6p/kWh to all domestic customers, whilst Eon are offering 5.24p/kWh to the first 500 new installs that sign up to the scheme.

Important points to note with SEG tariffs is that it does require that you have your electricity supply contract with the provider of your tariff, so it is important to consider the price you pay for your electricity from the grid as well as the price you are paid for selling generation. In addition to this BEIS have stated that to gain access to official SEG tariffs, customers must have a smart meter.

To understand more about the Smart Export Guarantee or discuss the potential of a Solar PV installation at your home of business, please contact Isoenergy today.


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