What is the Smart Export Guarantee and how much does it pay?

The Smart Export Guarantee (SEG) is a government-mandated scheme that requires licensed electricity suppliers with 150,000 or more domestic customers to offer at least one export tariff to small-scale renewable generators, including solar PV. There is no minimum rate set by the government — suppliers set their own rates. As of early 2025, fixed SEG rates range from approximately 3p/kWh (some major suppliers) to 15p/kWh (some specialist tariffs), with flexible/Agile tariffs paying up to 30p+ per kWh at peak times. To qualify, your system must be MCS-certified and you must have a smart meter or export meter. Apply to your energy supplier — you do not have to use the same supplier for import and export.

Does solar PV still qualify for 0% VAT in 2025?

Yes. Solar PV panels, inverters, and battery storage installed alongside solar PV qualify for 0% VAT in the UK. The zero rate started in April 2022 and runs until 31 March 2027. Since 1 February 2024 it also covers battery storage retrofitted to an existing system or installed on its own, and diverters added to existing solar panels (HMRC). The 0% rate applies to the supply and installation of qualifying energy-saving materials, including solar panels and batteries. Scaffolding, labour charges directly related to installation, and associated electrical work (such as consumer unit upgrades) also qualify for 0% VAT when included in a qualifying solar PV installation quote.

Who qualifies for ECO4 solar panels?

ECO4 (Energy Company Obligation 4, extended to 31 December 2026 so installers can finish work already under way) funds energy efficiency improvements including solar PV for eligible households. To qualify through the standard route, the household must: receive a qualifying benefit (including Universal Credit, Pension Credit, Child Tax Credit, or Working Tax Credit) AND have a home rated EPC band D, E, F, or G. The works must be part of a whole-house improvement plan — solar PV may be installed alongside insulation and heating upgrades. Contact a registered ECO4 installer (most large solar companies are registered) for a free eligibility assessment. Alternatively, your local authority may be able to refer you through the LA Flex route.

What happened to the Feed-in Tariff?

The Feed-in Tariff (FiT) scheme closed to new applications on 1 April 2019. Under the FiT, solar PV owners received a generation tariff (paid for every unit generated, regardless of whether it was used or exported) and an export tariff (paid for estimated or metered exported units). Rates were guaranteed for 20 years from the date of registration. Approximately 850,000 installations remain on the FiT scheme and continue to receive payments until their term ends. If you registered before April 2019, your FiT payments continue — you do not need to switch to the SEG. New solar PV installations from April 2019 onwards can only access the SEG for export payments.

Can landlords get solar grants for rental properties?

Landlords can access ECO4 and LA Flex funding for solar PV on rental properties where the tenant meets the qualifying benefit criteria. There are no specific landlord grant schemes for solar PV in England and Wales beyond the ECO4 framework. However, landlords can benefit from the 0% VAT rate on installations, and solar PV installed on rental properties may qualify for capital allowances (business landlords should seek advice from an accountant). Some local authority LA Flex schemes have extended eligibility to private rented sector properties regardless of tenant benefit status — check with your local council.

How do I apply for the Smart Export Guarantee?

Contact your chosen licensed electricity supplier (you can use any supplier offering a SEG tariff, not just your import supplier) and apply for their SEG tariff. You will need: your MCS Installation Certificate (MIC) number; the details of your system (capacity in kW, installation date); and evidence that a smart meter or export meter is installed or arranged. The supplier will verify your details against the MCS database. Processing typically takes 2–6 weeks. Once approved, export payments are made based on smart meter half-hourly export readings (for smart meter SEG) or estimated export calculations (for meters that cannot measure half-hourly export).

Is there a grant for solar panels in Scotland?

Not a dedicated one any more. The Home Energy Scotland Grant and Loan (run by Energy Saving Trust for the Scottish Government) stopped funding solar PV and battery storage for applications after 6 June 2024; it still funds heat pumps. Scottish installations still get 0% VAT until 31 March 2027 and can earn from the Smart Export Guarantee. Home Energy Scotland (0808 808 2282) can tell you about any other support for your home.

SOLAR GRANTS GUIDE

Solar Panel Grants UK 2026: Funding & Incentives Guide

Solar panel grants and incentives in the UK in 2026: the Smart Export Guarantee, 0% VAT until 31 March 2027, ECO4 and LA Flex until 31 December 2026, and what changed in Scotland.

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Key takeaways

01The Smart Export Guarantee (SEG) requires licensed energy suppliers with 150,000+ customers to pay for surplus solar electricity exported to the grid. Rates vary by supplier and tariff — currently 3–15p/kWh depending on the tariff type.
02Solar PV installations attract 0% VAT in the UK until 31 March 2027, when the rate is due to return to 5%. Battery storage installed alongside solar also qualifies for 0% VAT.
03ECO4 (Energy Company Obligation) can fund solar PV for low-income and fuel-poor households. Eligibility is means-tested; the homeowner must receive certain qualifying benefits or have a low EPC rating (D, E, F, or G).
04LA Flex allows local authorities to extend ECO4 eligibility to households that do not qualify through standard benefit criteria but are in fuel poverty. Coverage and availability vary significantly by local authority.
05There is no Feed-in Tariff (FiT) for new solar PV installations in Great Britain. The FiT scheme closed to new applications on 1 April 2019. Systems registered before that date continue to receive FiT payments until their 20-year term ends.
06In Scotland, the Home Energy Scotland Grant and Loan stopped funding solar PV and battery storage for applications after 6 June 2024. It still funds heat pumps. Scottish homes still get 0% VAT and the Smart Export Guarantee.

01 · Solar Grants Guide

Smart Export Guarantee (SEG)

The Smart Export Guarantee (SEG) is the current mechanism for compensating solar PV owners who export surplus electricity to the grid. Unlike the old Feed-in Tariff, it is not a government-funded subsidy — it is a mandated market mechanism requiring large energy suppliers to offer competitive export rates.

Who must offer the SEG: All licensed electricity suppliers with 150,000 or more domestic customers. This includes all the major UK energy suppliers. Smaller suppliers can offer SEG tariffs voluntarily. You can apply to any SEG licensee — you are not restricted to your import supplier.
Current rates (early 2025): Fixed rates range from 3–15p/kWh depending on the supplier. Octopus Energy's Flux and Agile tariffs offer dynamic rates that track wholesale prices and can pay 30p+ per kWh during peak demand periods. The best SEG tariffs are often available to customers who also use that supplier for their import tariff and have a compatible smart inverter.
Eligibility: Your system must be MCS-certified with a maximum capacity of 5 MW. A smart meter or export meter must be installed. The system must use grid-compatible inverter technology with anti-islanding protection. There is no upper limit on how much you can export.

A typical 4 kWp UK home system generates approximately 3,500 kWh/year and exports roughly 40–50% (1,400–1,750 kWh) to the grid. At 10p/kWh SEG rate, this generates £140–£175/year in export income — in addition to the value of self-consumed solar electricity (avoided import cost at 24p+/kWh).

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02 · Solar Grants Guide

0% VAT on Solar Installations Until 2027

One of the most significant financial incentives for solar PV in the UK is the zero rate of VAT on qualifying installations. This was introduced in April 2022 and represents a saving of 20% on what was previously a 5% VAT rate.

What qualifies at 0%: Solar PV panels, inverters (string, micro, hybrid), mounting systems, DC and AC wiring, battery storage installed alongside solar PV, monitoring systems, generation meters, and installation labour. Consumer unit upgrades and scaffolding included in a solar installation quote also qualify.
What is not covered: Repairs to existing systems are not energy-saving materials, so standard VAT applies; seek specific VAT advice for maintenance work.
Duration: The 0% VAT rate applies until 31 March 2027. Under current legislation it then returns to the 5% reduced rate.

For a typical 4 kWp solar plus 10 kWh battery system costing £11,000 installed, the 0% VAT rate compared to the pre-2022 20% rate saves the customer approximately £1,833. This makes the UK one of the most VAT-favourable markets for solar PV in Europe.

03 · Solar Grants Guide

ECO4 Scheme for Low-Income Households

ECO4 (Energy Company Obligation 4) is the fourth iteration of the government's Energy Company Obligation scheme. It ran from April 2022 and was extended to 31 December 2026 to let installers finish work already under way; the government has said there will be no successor supplier obligation, and its Warm Homes Plan takes over from 2027. It requires large energy suppliers to fund energy efficiency and renewable energy improvements for low-income and fuel-poor households.

Standard eligibility: The household must receive at least one qualifying benefit (Universal Credit, Pension Credit, Income Support, Working Tax Credit, Child Tax Credit, Housing Benefit, or certain DWP benefits) AND the property must have an EPC rating of D, E, F, or G.
Solar PV under ECO4: Solar PV is an eligible measure under ECO4 but is typically only funded as part of a whole-house improvement plan. The ECO4 rules prioritise insulation and heating measures. Solar PV is more likely to be funded where the property already has adequate insulation and a heat pump or electric heating is being installed.
How to access ECO4: Contact a registered ECO4 installer — most large insulation and solar companies are registered. Alternatively, contact your energy supplier directly, as they are obligated to fund the scheme and will direct you to registered installers. The government's Simple Energy Advice website also provides a referral pathway.

04 · Solar Grants Guide

LA Flex Schemes

LA Flex (Local Authority Flexible Eligibility) is a mechanism within ECO4 that allows local authorities to declare households eligible for ECO4 funding even if they do not meet the standard benefit criteria. This extends the scheme's reach to households in fuel poverty who are not receiving qualifying benefits. As part of ECO4, LA Flex installations must be completed by 31 December 2026, and funding is now limited.

Eligibility criteria: The local authority sets its own criteria, but typically includes households with a low income (usually defined by household income thresholds), those in fuel poverty, households with a member who has a health condition affected by cold or damp, and households in high-cost-to-heat properties (EPC D, E, F, or G).
Coverage and availability: LA Flex coverage varies enormously by local authority. Some councils have proactively used the scheme to fund hundreds of installations; others have not implemented it at all. Contact your local council's housing or energy team to find out whether LA Flex is available in your area.
Declaration process: If your council operates LA Flex, they will issue a Declaration of Eligibility that allows a registered ECO4 installer to proceed with funded works. The council may conduct a home assessment beforehand.

05 · Solar Grants Guide

Scotland: What Changed

Until June 2024 the Home Energy Scotland Grant and Loan, funded by the Scottish Government and run by the Energy Saving Trust, could pay for solar PV and battery storage. For applications after 6 June 2024 it no longer funds solar PV or energy storage. It still funds heat pumps, with a grant and an optional interest-free loan.

Solar installations in Scotland still benefit from the UK-wide 0% VAT rate until 31 March 2027 and can earn from the Smart Export Guarantee. For any other support, Home Energy Scotland’s advisers are on 0808 808 2282.

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06 · Solar Grants Guide

No Feed-in Tariff for New Installations

Homeowners considering solar PV often ask about the Feed-in Tariff. It is important to be clear: the Feed-in Tariff scheme closed to new applications on 1 April 2019 and cannot be accessed by new installations.

Existing FiT installations: The approximately 850,000 UK installations registered before 1 April 2019 continue to receive FiT generation tariff payments for the remainder of their 20-year term. If you purchased a property with solar panels installed before April 2019, check with the previous owner whether the FiT was registered and whether it transferred with the property.
New installations: All solar PV systems installed from 1 April 2019 onwards use the SEG for export payments. There is no generation tariff — only an export tariff based on metered or estimated export. The economics of solar PV remain very favourable in 2025 due to high electricity import prices, the 0% VAT rate, and competitive SEG tariffs.

07 · Solar Grants Guide

How to Apply for Solar Grants and Incentives

The process for accessing solar PV grants and incentives in the UK varies by scheme. Here is a summary of the application process for each:

SEG: Contact your chosen supplier after installation is complete. Provide your MCS certificate number and smart meter details. Processing takes 2–6 weeks. The supplier will contact you with tariff options and start date.
0% VAT: No application required. Your MCS-certified installer applies 0% VAT automatically on the invoice for qualifying solar PV and battery installations.
ECO4/LA Flex: Contact your energy supplier or a registered ECO4 installer. For LA Flex, contact your local council first to obtain an eligibility declaration. There is no direct application to a central body — the process is managed by registered installers.
Scotland: Home Energy Scotland no longer funds solar PV, but its advisers (0808 808 2282) can tell you about any other support.

08 · Solar Grants Guide

For Electricians: Helping Customers Access Grants

MCS-certified electricians play a central role in helping customers access solar grants and incentives. The MCS Installation Certificate is the key document for SEG applications. Electricians who understand the grants landscape can provide more complete advice and win more installations.

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