Why is self-consumed solar worth more than exported solar?

Electricity you use as it is generated saves you the full retail price you would otherwise have paid, including VAT. Electricity you export earns only your supplier export rate under the Smart Export Guarantee, which is usually a fraction of the retail price.

What is a good solar self-consumption rate?

There is no single good figure, because it depends entirely on when a household uses electricity relative to when its panels generate. A home occupied during the day consumes much more of its own generation than one empty from morning until evening, which is why the same roof produces very different economics for different households.

How can I increase my solar self-consumption without a battery?

Shift flexible loads into daylight hours. Running the dishwasher, washing machine, immersion heater or EV charger while the panels are generating converts electricity that would have been exported at a low rate into electricity you did not have to buy at the retail price. It costs nothing and is often more effective than households expect.

Does a bigger solar array always earn proportionally more?

No. Beyond the point where generation exceeds what you can consume as it is produced, additional output is exported at the low export rate rather than offsetting the retail price, so each extra kilowatt-hour is worth substantially less than the first.

Why a unit you use is worth more than a unit you export

Self-consumed solar is paid at the retail price you avoid. Exported solar is paid at your SEG rate, a fraction of it. That gap decides what your panels earn, and it is what home battery storage is actually buying.

Economics7 min read

Photograph to accompany: Why a unit you use is worth more than a unit you export

The short answer

A unit of solar electricity you use as it is generated is worth the retail price you avoid paying. A unit you export is worth your supplier export rate, which is typically a fraction of that. The gap between those two numbers is what battery storage is buying.

There is one idea that explains most of solar economics in the UK, and once you have it, quotes and comparison tables stop being confusing.

A kilowatt-hour your panels produce can go to one of two places, and it is worth a very different amount depending on which.

1You use it as it is generated. It is worth the full retail price you did not have to pay, which is the unit rate on your bill including VAT.
2You export it to the grid. It is worth whatever your supplier pays under the Smart Export Guarantee, which is typically a fraction of the retail price.

That is the whole thing. Everything else, from array size and orientation to batteries and tariffs, is a way of changing the proportion that falls into the first bucket rather than the second.

Why self-consumption is the number that matters

The share of your generation you use as it is produced is called self-consumption, and it is the least discussed and most decisive figure in a solar quote.

A household at home during the day, whether that is someone working from home, a young family or a retired couple, naturally uses a large share of what the roof makes. The kettle, the washing machine and the fridge are all drawing power at the same time the sun is on the panels. Very little is exported, so very little is paid at the low rate.

A household out from eight until six has the opposite profile. The panels do their best work into an empty house. Most of the day's generation goes to the grid at the export rate, and the electricity used to cook dinner that evening is bought back at the retail price.

Same roof, same weather, same annual output. Substantially different money.

What this means for solar quotes

A quote that promises a single savings figure has quietly made an assumption about your daily routine, and it has almost certainly made a flattering one. Ask what self-consumption rate it assumes. If the answer is a round number applied to every customer, the figure underneath it is a template rather than a calculation.

Does a bigger array always earn more?

Not proportionally, and this surprises people who assume solar scales linearly.

The first few panels displace electricity you were going to buy anyway, so every unit they make is worth the retail price. Once your array produces more than you can consume in the moment, the extra output has nowhere to go but the grid, where it earns the export rate.

So the value per panel falls as the array grows. A larger system still earns more in total, but each additional kilowatt earns less than the one before it. Whether that is worth the extra capital is a genuine question rather than an obvious yes, and it is one worth putting real numbers to.

The three levers you actually control

Your export rate. Set by your supplier, changeable by switching, and the fastest thing to fix because it needs no equipment and no installer.
Your self-consumption. Moved by shifting flexible loads into daylight hours: dishwasher, washing machine, EV charging, immersion heater. Free, and more effective than most people expect.
Storage. A battery raises self-consumption by holding surplus generation until the evening. It is the expensive lever, and the one worth checking carefully before buying.

The first two cost nothing. It is worth exhausting both before considering the third, which is the subject of its own guide.

Common questions

Why is self-consumed solar worth more than exported solar?: Electricity you use as it is generated saves you the full retail price you would otherwise have paid, including VAT. Electricity you export earns only your supplier export rate under the Smart Export Guarantee, which is usually a fraction of the retail price.
What is a good solar self-consumption rate?: There is no single good figure, because it depends entirely on when a household uses electricity relative to when its panels generate. A home occupied during the day consumes much more of its own generation than one empty from morning until evening, which is why the same roof produces very different economics for different households.
How can I increase my solar self-consumption without a battery?: Shift flexible loads into daylight hours. Running the dishwasher, washing machine, immersion heater or EV charger while the panels are generating converts electricity that would have been exported at a low rate into electricity you did not have to buy at the retail price. It costs nothing and is often more effective than households expect.
Does a bigger solar array always earn proportionally more?: No. Beyond the point where generation exceeds what you can consume as it is produced, additional output is exported at the low export rate rather than offsetting the retail price, so each extra kilowatt-hour is worth substantially less than the first.