Solar Incentives in the United Kingdom 2026: SEG, 0% VAT & Home Grants
Last updated July 2026
The UK pays small-scale solar owners for exported electricity through the Smart Export Guarantee (SEG), which replaced the closed Feed-in Tariff, and applies a temporary 0% VAT rate to home solar. Grants such as ECO4 and the Warm Homes programmes target lower-income households. Systems need MCS certification and a DNO grid connection. Confirm current terms at the official source.
The UK supports household and business solar mainly through export-payment and tax mechanisms rather than a single national subsidy. Owners of small-scale solar are paid for surplus electricity they export to the grid via the Smart Export Guarantee (SEG), which replaced the closed Feed-in Tariff, while installations of solar and other energy-saving materials in homes currently benefit from a temporary zero rate of VAT. Targeted energy-efficiency support (such as ECO and the emerging Warm Homes programmes) can include solar for lower-income and less energy-efficient households, and the devolved nations run their own schemes, for example Home Energy Scotland's grant and loan. Rates, tariff levels, budgets and deadlines change frequently, so figures should always be confirmed at the official source before relying on them.
Registering your solar system on the grid
DNO grid connection (G98/G99 process) and MCS certification
Small-scale solar is registered by connecting to the local electricity network through the relevant Distribution Network Operator (DNO) using the Energy Networks Association's G98 (smaller systems, notify-and-connect) or G99 (larger systems, apply-before-connect) engineering procedures; the installer normally submits this notification/application. Separately, systems are usually certified under the Microgeneration Certification Scheme (MCS), which certifies installers and products and is generally required to access the Smart Export Guarantee.
Smart Export Guarantee (SEG)
Administered by: Ofgem (regulator/administrator); payments made by licensed electricity suppliers (SEG Licensees)
A scheme that requires larger licensed electricity suppliers to offer tariffs paying small-scale low-carbon generators for the electricity they export to the grid. It replaced the Feed-in Tariff, which closed to new applicants in 2019, and moved from government-set rates to a supplier-set, market-based model.
Who it is for: Owners of eligible small-scale generation (including solar PV up to the scheme's capacity limit) installed by an MCS-certified installer using certified products, with a meter capable of recording exported electricity; the generator applies to a SEG supplier of their choice.
0% VAT on energy-saving materials (residential solar)
Administered by: HM Revenue & Customs (HMRC)
A VAT relief that applies a zero rate to the installation of qualifying energy-saving materials, including solar panels and associated equipment, in residential accommodation. It is a time-limited relief scheduled to revert to a reduced VAT rate in future, so the current rate and end date should be checked with HMRC.
Who it is for: Households having qualifying energy-saving materials supplied and installed in residential property in Great Britain; the relief is applied by the installer/contractor rather than claimed directly by the homeowner.
Energy Company Obligation (ECO4)
Administered by: Department for Energy Security and Net Zero (DESNZ) sets policy; Ofgem administers; obligated energy suppliers deliver measures
An obligation on medium and large energy suppliers to fund home energy-efficiency and heating improvements for lower-income, fuel-poor and vulnerable households, which can include renewable measures such as solar PV in some cases. ECO4 is time-limited and being succeeded by a government grant-funded model under the Warm Homes Plan, so current status should be confirmed.
Who it is for: Low-income households, typically those receiving certain means-tested benefits or identified through local authority flexible eligibility (ECO Flex), generally in less energy-efficient homes.
Warm Homes Plan (incl. Warm Homes: Local Grant & Social Housing Fund)
Administered by: Department for Energy Security and Net Zero (DESNZ), delivered with local authorities and social housing providers
A government-funded programme to upgrade homes with energy-efficiency and low-carbon measures, which can include solar, positioned as the successor framework to the supplier-obligation model. It is delivered through components such as the Warm Homes: Local Grant and the Warm Homes: Social Housing Fund; scope, eligibility routes and funding evolve over time and should be checked at the official source.
Who it is for: Broadly targeted at low-income households and social housing tenants, often accessed via local authorities or housing providers rather than by direct national application.
Home Energy Scotland Grant and Loan (Scotland)
Administered by: Scottish Government, administered by Energy Saving Trust through Home Energy Scotland
A devolved-nation funding package offering a combination of grant and interest-free loan to help Scottish homeowners install renewable and energy-efficiency measures, with solar typically supported through the loan element. Exact eligible technologies, grant/loan split and terms should be confirmed with Home Energy Scotland.
Who it is for: Homeowners in Scotland whose property is their only or primary private residence; benefit receipt is not required to qualify.
Before you rely on any figure — check the official source
Solar incentive rates, tariff levels, budgets, eligibility thresholds and deadlines in the United Kingdom change frequently, and several schemes run on limited budgets or fixed application windows. This guide describes each programme at the mechanism level and links to the official administering body so you can confirm the current terms for your own project and year. Never commit to a purchase on the strength of a headline number from a third-party site — including this one.
Once you know which schemes apply, the practical next step is a qualified local installer who can size the system, handle the grid registration and apply for the incentives that fit. Browse solar companies in the United Kingdom → on Solar Directory.
Official sources
Every programme fact on this page is drawn from official government and agency sources. Confirm the current terms directly:
- https://www.ofgem.gov.uk/environmental-and-social-schemes/smart-export-guarantee-seg
- https://www.gov.uk/guidance/vat-on-energy-saving-materials-and-heating-equipment-notice-7086
- https://www.gov.uk/energy-company-obligation
- https://www.gov.uk/government/publications/warm-homes-plan
- https://www.homeenergyscotland.org/home-energy-scotland-grant-loan
- https://www.energynetworks.org/publications/all-g98-g99-forms
Solar support programmes in the United Kingdom at a glance
| Programme | What it does | Official source |
|---|---|---|
| Smart Export Guarantee (SEG) | Payment for electricity you export | Official page → |
| 0% VAT on energy-saving materials (residential solar) | 0% VAT on home solar — temporary relief | Official page → |
| Energy Company Obligation (ECO4) | Supplier-funded home upgrades (low income) | Official page → |
| Warm Homes Plan (incl. Warm Homes: Local Grant & Social Housing Fund) | Government-funded home upgrades | Official page → |
| Home Energy Scotland Grant and Loan (Scotland) | Scotland: grant + interest-free loan | Official page → |
Frequently Asked Questions
Is the Feed-in Tariff still available for new solar installations?
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No. The Feed-in Tariff closed to new applicants in 2019. New small-scale solar owners are instead paid for exported electricity through the Smart Export Guarantee (SEG), which is administered by Ofgem and paid by licensed electricity suppliers, each setting their own export tariff.
Do I need MCS certification and a grid connection to get paid for exporting solar power?
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For the Smart Export Guarantee you generally need your system installed by an MCS-certified installer using certified products and a meter able to record what you export. Separately, your installation must be registered with your local Distribution Network Operator through the G98 or G99 connection process, which the installer usually handles.
Are there grants that cover solar for households on lower incomes?
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Yes, targeted support exists through schemes such as the Energy Company Obligation and the government-funded Warm Homes programmes in England, and the Home Energy Scotland grant and loan in Scotland. These are aimed mainly at lower-income or less energy-efficient households, and eligibility and covered measures should be checked at the official source as schemes are updated or replaced over time.
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