How to sell energy back to the grid. Ways for your business to make money

If your business is thinking about installing solar panels or other renewable generation, you’ve probably wondered whether you can sell any unused electricity back to the grid and get paid for it. 

Thanks to the Smart Export Guarantee (SEG), eligible businesses can earn money for every unit of surplus renewable electricity they export – creating a small but steady extra income stream alongside lower energy bills.

This guide explains how selling energy back to the grid works for UK businesses, what the SEG is, how much you could earn, and what you need to qualify.

Five-point summary on selling energy back to the grid

1. UK businesses with eligible renewable systems (like solar PV, wind, hydro, anaerobic digestion and micro‑CHP) can get paid for surplus electricity exported to the grid under the Smart Export Guarantee.
2. SEG export tariffs are offered by licensed suppliers, with rates typically ranging from around 3p/kWh to over 20p/kWh depending on the supplier, tariff type and whether you’re already a customer.
3. You’ll need an eligible MCS‑certified or equivalent installation, an export‑capable smart meter, and a separate SEG contract – your import and export tariffs don’t have to be with the same supplier.
4. Export earnings are rarely enough to cover a full system on their own, but when combined with bill savings, they can significantly improve the payback period of your renewable investment.
5. Before you sign up, it’s worth checking how much you’re likely to export, comparing SEG rates and terms, and making sure your business energy contract supports your self‑generation plans

What does it mean to sell energy back to the grid?

Selling energy back to the grid is when unused electricity generated at your business is sold back to the National Grid via your energy supplier. Instead of wasting the surplus, you earn money for each kilowatt hour (kWh) that flows from your premises back into the network.

Any household or business with eligible renewable generation, for example, solar panels on your roof, a small wind turbine, a micro‑CHP unit or other green installations, could potentially sell excess energy back to their supplier. 

What used to be a complex process has been simplified as more homes and businesses have installed renewables and smart meters, and the Smart Export Guarantee has replaced the old Feed‑in Tariff scheme.

Currently, the main way you sell excess energy is through a government‑mandated scheme called the Smart Export Guarantee (SEG). Read all about it below.

In practice, this means your export meter records how much renewable electricity you send to the grid, and your SEG or export tariff provider pays you an agreed pence‑per‑kWh rate, usually by bank transfer on a monthly or quarterly schedule.

What is the Smart Export Guarantee (SEG)?

The Smart Export Guarantee is a scheme that requires larger energy suppliers to offer a payment to customers who export surplus renewable electricity back to the grid. If your business generates electricity from eligible technologies (like solar PV, wind, hydro, anaerobic digestion or micro‑CHP) and you meet the scheme criteria, you can sign up to an SEG export tariff and get paid per kWh exported.

The SEG replaced the Feed‑in Tariff (FiT) for new applicants from 2020. Unlike FiT, SEG payments are not set by the government – suppliers set their own export rates and tariff structures, which is why it’s important to compare options.

Competition between suppliers means some SEG tariffs now pay significantly more than the early 3p to 6p/kWh rates, especially for customers who also take their import electricity from the same provider.

Under SEG, larger suppliers (those with 150,000+ customers) must offer at least one export tariff, but smaller suppliers can choose to participate voluntarily and set their own terms and rates.

Unlike FiT, SEG only pays for the electricity you actually export, so your total benefit comes from both the savings on your on‑site usage and the additional income from exported units.

What technologies qualify for SEG payments?

To qualify for SEG payments, your business must generate electricity using one of the eligible small‑scale low‑carbon technologies and meet certain conditions. The SEG accepts the following technologies (subject to capacity limits and certification):

• Solar photovoltaic (solar PV) – Rooftop or ground‑mounted panels that convert sunlight into electricity.
• Wind power – Small‑scale wind turbines installed on your site.
• Hydro – Micro‑hydro systems that use flowing water to generate electricity.
• Anaerobic digestion (AD) – Systems that break down organic matter to produce biogas, which can then generate electricity.
• Micro‑Combined Heat and Power (micro‑CHP) – Small units that generate both heat and electricity, usually for individual buildings.

You’ll usually need your installation to be certified under the Microgeneration Certification Scheme (MCS) or an equivalent scheme, and your total installed capacity must be within the limits set by SEG rules (up to 5MW for most technologies, 50kW for micro‑CHP).

How do SEG export tariffs work?

When you sign up for an SEG export tariff, your supplier will pay you a set rate for every kWh of electricity you export to the grid. Your export is measured by a smart meter or other export‑capable meter, and payments are usually made monthly or quarterly, depending on the supplier.

Just like standard business energy tariffs, SEG tariffs can be fixed or variable:

• A fixed SEG tariff pays a set pence‑per‑kWh rate for exported electricity over a defined contract period (for example, 12 months).
• A variable SEG tariff tracks the market or a supplier‑set rate and can go up or down over time.

Government rules say that export prices must always be above zero, so you’ll be paid at least something for every kWh you export, though the exact rate can vary a lot between suppliers.

Some suppliers also offer premium SEG rates to customers who buy their imported electricity from them or who meet certain criteria (for example, using a partner installer or having a linked battery), so it’s worth checking eligibility carefully.

How does the process of selling energy work?

Businesses in Great Britain with renewable energy systems linked to small-scale generators can apply for this scheme as long as they meet certain criteria.

Businesses that generate energy using anaerobic digestion can also apply for the SEG scheme. These are businesses that create electricity by breaking down organic matter like animal manure, wastewater and food waste with bacteria.

Read the full guidelines for anaerobic digestion here. For more detailed information on how the wider energy market works, check out our guide to how energy is bought and sold and how it affects UK prices.

For those who use small generators, you need to go through the process of applying and passing the requirements below to benefit from this scheme.

First, check if you’re eligible

Businesses located in England, Scotland, or Wales can apply for the SEG tariff. It’s not currently available to businesses in Northern Ireland. 

You can apply for SEG if your business generates renewable energy in any of the following ways:

• Solar Photovoltaics (PV)  - Systems using energy from the sun like solar panels.
• Wind Power - For example, wind turbines or micro wind turbines that generate electricity.
• Hydropower — Generated from flowing water. Either from natural or man-made rivers or streams. 
• Anaerobic Digestion (AD) - Energy generated from using bacteria to break down organic matter and turn it into energy.
• Micro-Combined Heat and Power (micro-CHP) - Refers to any system that generates heat and electricity at the same time, from the same source. For example, internal combustion engines.

You also must be able to prove that your systems and/or generators are professionally installed and certified, and you might have to provide an MSC certificate (Microgeneration Certification Scheme). The scheme also recognises other types of certificates. Speak to your supplier when applying to make sure. Depending on your system’s capacity, you’ll need the following certificates to be eligible.

You’ll also need an export meter with an MPAN number that’s capable of taking hourly measurements. This is a 13-digit reference number unique to your electricity connection point and is separate from your existing import number. If you don’t have an export meter, you can request one from your supplier when signing up for a SEG tariff.

In some cases, you might be able to use your existing business energy meter and link it up with the SEG for exported electricity. Speak to your supplier to check if this is possible for you.

Read the full guidelines for generators here.

You should also check with your Distribution Network Operator (DNO) that your connection allows export at the capacity you’re planning, as some sites may need network upgrades or specific export limits agreed before SEG payments can start.

Sign up for an SEG tariff 

To benefit from a SEG tariff, you need to sign up for one. This is separate from your business energy tariff and deals with exporting the spare energy you generate. 

Suppliers with more than 150,000 customers are required to offer an SEG tariff, which means if your business energy contract is with a well-known supplier, they’ll most likely offer an SEG tariff, but you don’t need to go with the same supplier if you don’t want to. 

Like any deal, different suppliers offer different types of contracts with varying rates, lengths and conditions. So it’s best to shop around to find the right one for your business. 

Here is a list of the suppliers that currently offer the SEG scheme as of April 1, 2023, to March 31, 2024:

• British Gas
• E (Gas & Electricity)
• E.ON
• EDF
• Octopus Energy
• OVO Energy
• ScottishPower
• Shell Energy
• So Energy
• The Utility Warehouse
• Utilita
• Pozitive Energy
• Rebel Energy

You’re not eligible for an SEG tariff if you are still receiving export payments under the Feed-in-Tariff scheme.

Some suppliers cap SEG payments at a certain annual export volume or only pay variable rates linked to wholesale prices, so always read the tariff terms carefully before you sign up.

Sell your excess energy

When you register for a SEG tariff, you’ll get paid for every unit of electricity you feed back to the National Grid. 

Like a standard business energy tariff, these can be fixed or variable and vary per supplier. A fixed tariff will pay you a rate for exported electricity based on KwH over the length of the contract. A variable rate will change based on market demand. However, government guidelines state that prices will never fall below zero. 

Typical SEG rates are often only a few pence per kWh – and usually lower than the price you pay to import electricity – so you’ll usually save more by using as much of your generated energy on site as possible and exporting the genuine surplus.

How much you earn depends on many factors, including how many solar panels, microturbines or hydro systems you have in place and the amount of energy it generates. Other factors like location and your supplier’s rate will also affect how much you’ll earn.

Receive cash payments

Once your supplier receives readings from your export meter, you’ll begin to receive payments. Your supplier will determine how often these are. Usually, SEG payments are sent via a bank transfer monthly or quarterly, but each supplier is different, so check your contract for the exact terms. 

Some providers also allow SEG customers to offset export income against their energy bills, which can help with budgeting and reduce the amount you pay by Direct Debit each month.

How much can your business earn from selling energy back to the grid?

How much you can earn depends on three main factors: how much surplus electricity you export, which SEG tariff you’re on, and your export rate in pence per kWh.

As of late 2025 and early 2026, SEG export rates from major suppliers span a wide range – from around 3p per kWh at the low end for basic tariffs up to 20 to 24p per kWh or more for certain exclusive export deals tied to specific installers or customer statuses. 

For example, recent comparison data shows tariffs like EDF Export Exclusive around 24p/kWh, E.ON Next Export Premium around 21p per kWh, and British Gas Export & Earn Plus paying 15.1p per kWh for eligible customers.

To give a rough idea, one 4kW solar PV system exporting between 1,900 and 2,000 kWh a year could earn anywhere from under £60 per year at 3p per kWh to more than £400 per year at 20 to 24p per kWh in export payments, depending on your tariff. 

A medium system of around 30 kWp could export 9,000–10,000 kWh a year and bring in £540–£600 a year at the same export rate, while a larger 100 kWp system exporting 30,000 kWh could earn around £1,800.

Export income should always be viewed alongside the savings from self‑consumption, which are usually higher because the price you avoid paying for imported electricity is greater than the export rate you receive.

These numbers are only examples, so it is important to ask your installer for a site‑specific generation and export forecast and to check the exact export rate offered by your chosen SEG or export tariff provider.

Businesses with larger systems or higher export volumes could earn more. But most will still find that bill savings from using your own power are the biggest financial benefit, with exports as a useful top‑up.

Do you need to be on a specific energy tariff or with a specific supplier?

To get SEG payments, you’ll need a dedicated SEG export contract – but you don’t always have to get it from the same supplier that provides your import electricity.]

• Some suppliers offer export‑only SEG tariffs, so you can keep your existing business energy contract with one supplier and take your SEG payments from another.
• Others give you a higher export rate if you’re also an import customer, or if your system was installed by a partner installer.

It’s worth comparing the combined impact of your import and export tariffs – the best export rate isn’t always the best overall deal if the import side is much more expensive.

Can you sell energy back to the grid if you're not using renewable energy sources?

In short, no. The SEG scheme is designed for selling renewable electricity generated from eligible low‑carbon technologies such as solar, wind, hydro, anaerobic digestion and micro‑CHP. You can’t claim SEG payments for electricity generated from fossil‑fuel‑only systems.

But you can sell back renewable energy that’s stored in batteries or electric vehicles, as long as it was originally generated by an eligible renewable source and your setup meets the supplier’s rules. Your supplier should be able to advise you on whether your system qualifies and how to configure your metering so exported units are measured correctly.

If you generate electricity from fossil‑fuel‑only technologies, such as a conventional diesel generator with no eligible renewable component, you will not qualify for SEG payments.

Business tax, accounting and VAT on export income

Any payments your business receives for exporting electricity to the grid will usually count as taxable income, so you should record them properly and discuss the treatment with your accountant or tax adviser.

For many SMEs, SEG or export income will simply be included within trading profits, but larger generation projects or companies set up specifically to own renewable assets may need more detailed advice on how revenues, capital allowances and any grants interact.

If your business is VAT‑registered, you will also need to check how VAT applies to your installation costs and export payments, as this can vary depending on system size, use of the power and whether you are classed as a generator for VAT purposes.

Keeping clear records of invoices, SEG statements, meter readings and installation documents will help you complete accurate returns and demonstrate compliance if HMRC requests evidence.

Batteries, EVs and maximising self-consumption

Adding battery storage to your solar PV or other renewable system allows you to store surplus electricity during the day and use it later when your business is open or grid prices are higher, which can reduce how much you need to buy from the grid.

For example, a small retailer with solar panels and a battery can charge the battery during bright periods and then run lights, refrigeration and IT equipment in the evening from stored power rather than imported electricity.

If your business runs electric vehicles, smart charging can help you soak up more of your own generation by charging vans or cars when your system is producing well, rather than at peak grid times.

There is also growing interest in vehicle‑to‑grid (V2G) technology, which allows certain EVs and chargers to export power back to the grid, but this is still relatively niche and may not yet be available or cost‑effective for most small businesses.

Generally, the more renewable energy you can use on‑site in real time or via storage, the shorter your payback period is likely to be, with SEG or export tariffs providing additional income for any remaining surplus.

Are there specific size requirements for selling energy back to the grid?

Yes, the Smart Export Guarantee only supports installations with a total installed capacity (TIC) of up to 5MW (megawatts) for most systems. For business owners with micro-CHP systems installed, a maximum TIC of 50KW is allowed. Any system with a higher capacity is not eligible for the SEG scheme.

Larger-scale generation and battery projects may still be able to export and earn revenue, but this is usually done through different commercial arrangements such as power purchase agreements (PPAs) or flexibility services, rather than SEG.

Grid connection, DNO approvals and export limits

Before you install or significantly expand a generation system, you may need approval from your local Distribution Network Operator (DNO) to confirm that the grid in your area can safely accept the amount of power you want to export.

Smaller systems are usually covered by G98 notification rules, which allow installers to connect and then notify the DNO, while larger or more complex systems often require a G99 application and formal permission before connection.

In some areas, the DNO may set an export limit (for example, 3.68 kW per phase on a standard domestic‑style connection) which can restrict how much electricity you can send to the grid and therefore how much you can earn from SEG or export tariffs.

Upgrading your connection to allow more export capacity may be possible but can add extra time and cost to a project, so it is important to factor potential DNO works into your business case early on.

Your installer should be able to manage the application process and help you understand the impact of any export limits, curtailment arrangements or required network upgrades on your expected returns.

What are Feed-in Tariffs, and how do they affect the selling of energy? 

The Feed-in Tariff is a similar government scheme that was introduced prior to the SEG scheme. It was created to encourage low-scale renewable energy generation, supporting businesses and homeowners to install low-carbon ‘green’ infrastructure like solar panels. 

The idea behind this scheme was that domestic and non-domestic customers using this tariff would not only save on their own energy payments but also get paid for selling unused energy back to suppliers. 

The Feed-in Tariff (FIT) closed as of March 31, 2019, and is not accepting new applicants. 

This means if you installed a system after this date, you can’t apply for the scheme. But, you still may be eligible for the SEG scheme that replaced the Feed-in Tariff. See the eligibility guidelines above to check if you can apply. 

Read more about renewable energy for businesses to explore the costs of installing green infrastructure. 

If you already receive FiT payments, you may be able to move from the FiT export rate to a SEG export tariff while keeping your FiT generation payments, but you cannot usually receive FiT and SEG export payments at the same time.

SEG and export tariffs vs power purchase agreements (PPAs)

SEG and simple export tariffs are usually the best fit for smaller businesses with systems up to a few tens of kilowatts, because they are relatively straightforward and designed for low‑to‑medium export volumes.

Larger sites with significant generation – for example, big warehouses, manufacturing plants or solar farms – may instead look at signing a power purchase agreement (PPA) with a supplier or trader, which can offer bespoke pricing and terms over longer periods.

PPAs can sometimes provide more competitive rates or additional revenue streams, such as flexibility or balancing services, but they come with more complex contracts and often require professional advice and metering.

For many SMEs, the priority will be to size their system to maximise self‑consumption and then choose the most suitable SEG or export tariff; PPAs tend to be more relevant when export volumes are large and predictable.

If you are unsure which route is right for your business, speak to your installer, broker or a specialist energy advisor who can help you compare options.

What are the benefits of selling energy back to the grid?

When you sell electricity through the SEG scheme, cash in your pocket is not the only benefit. Your business is also set up to save in the long term. 

Reduced energy costs

If you install systems like solar panels on your business premises and generate some of your own power, this means you’re less reliant on energy from the grid. This, in turn, means you’re likely to save on your business energy bills because you’re paying for less energy because you don’t need as much. 

Different types of businesses use varying amounts of energy, so it’s difficult to say how much you could save. But for example, if you own a cafe and want to install solar panels on the roof, the initial installation might cost you around £6,000, but you’ll be saving on the amount you’re paying for your energy. After six to ten years, when you’ve paid off the installation costs, you’ll be using less energy from the grid, and your costs will likely be lower than they would be without the installation.

Your exact payback period will depend on system size, roof orientation, business opening hours, whether you have battery storage and the SEG or export tariff rate you secure.

Promotion of renewable energy

More and more consumers are looking to support environmentally friendly businesses. And if you’re one of them, you can promote this with online marketing material and even on your premises.

For example, if you own an eco-friendly restaurant that has solar panels installed and you use sustainable waste management, then this is something you can promote, and it may even help you drum up new business. 

If you decide to go down this route, make sure your sustainability message is consistent across your business, as you could be criticised. Find out more with our guide to greenwashing.

Government incentives

This is often in the form of relief on green taxes that every business has to pay.

For example, if your business is eco-friendly, you can get relief from The Climate Change Levy. This is an environmental tax that encourages businesses to have more sustainable practices. It's charged on energy usage - including lights, heating and anything that powers a business. So installing energy-efficient alternatives could mean you are exempt. 

You can check the full government list of grants and reliefs for green business practices here.

Sustainable development

As a nation, we’re aiming to hit net zero as more carbon-negative technologies are built. And having green practices in place means your small business will be ahead of the game, especially against competitors. 

In the future, we could see new energy innovations including wave technology or even solar from space. This new tech is all in a bid to help us reach our net zero target by 2050.

Read more about net zero and how we can achieve it with our guide.

By exporting clean power, your business also helps support a more resilient, decentralised energy system that is less reliant on fossil fuels and better able to cope with spikes in demand.

What are the limitations of selling energy back to the grid?

Since we’ve outlined the benefits of selling your spare energy, as with any new initiative, there are some potential drawbacks. 

Initial investment costs

Green infrastructure is not cheap. Upgrading to solar technology could set you back £6,000 - £10,000 (for a small system) and take up to a decade to pay back. So even if you’re saving on your business energy bills and selling electricity back to your supplier, you are unlikely to see a return on your investment immediately. But, investing in green practices in the short-term is likely to pay off in the long run, saving you costs down the line.

Installation costs can also increase if your roof needs structural work, you add battery storage, or you require a more complex grid connection or export limit agreement.

Lower payouts than the Feed-in Tariff

Although tariff rates vary per supplier, those who are familiar with or have previously signed up for the Feed-in Tariff will notice that you are paid much less on the SEG scheme - most likely between 6p and 9p per kWh. This is down to the popularity of green infrastructure increasing and the new SEG scheme offering different rates for energy exports.

Some specialist export tariffs can pay higher rates at certain times of day or when wholesale prices spike, but they often come with stricter conditions, smart meter requirements or variable pricing structures.

Hassle to upgrade your meter

As mentioned above, to qualify for the SEG tariff, you must have an export meter. This means you’ll likely need to get one installed or upgrade your current meter. This can be time-consuming as it involves filling in forms and contacting network operators. Your application for the tariff may also take some time to be approved, as a regulator will also need to check your certificates.

DIY installations are not approved

No matter what type of renewable energy systems you install, they must hold a certificate like the Microgeneration Certification Scheme. This means even if you are able to, you cannot install your own systems or upgrade them in any way yourself. If you have installed even part of the system yourself, you will not be eligible for the SEG scheme.

You can easily find a registered contractor to install your systems here.

Using accredited installers and products is not only a SEG requirement but can also protect your manufacturer warranties and help your business secure the best possible insurance cover for your equipment.

Checklist - Is selling energy back to the grid right for your business?

Before you invest, it helps to run through a quick checklist to see whether exporting energy is likely to make sense for your site.

You are more likely to benefit if you have a suitable roof or land area, good solar or wind exposure, predictable daytime electricity use and the budget to cover upfront installation costs and any required grid upgrades.

Having long‑term plans for your premises, access to trustworthy installers and a willingness to handle some extra admin around metering, DNO approvals and SEG applications will also work in your favour.

On the other hand, it may not be the right time if your building is due for major changes, your usage is very low, your roof is heavily shaded or your business prefers very short payback periods on investments.

A quick conversation with an accredited installer or an energy broker can help you stress‑test your assumptions, understand realistic payback periods and decide whether to proceed now or revisit the idea later.

How Bionic can help

Adding another meter might seem like extra work for your business, so it’s understandable if you need some time to think this over. If you need more help understanding how SEG tariffs work or how business energy works in general, get in touch today with the Bionic team today. We are also on hand to help with your business energy needs, including business electricity and business gas. 

Want to read up on business energy yourself? Head over to our energy guides section to see content from our energy experts.