What is Solar Electricity?

Solar photovoltaic (PV) systems, also referred to as solar electric systems, capture sunlight energy and convert it into electricity. PV systems can be used to power everything in your home from lights and appliances to an electric vehicle.

How Does PV Work?

The graphic below explains how solar electricity is produced, where the energy flows, and the bill-crediting mechanism known as “Net Energy Metering”.


  1. Individual photovoltaic (PV) cells are embedded onto panels. Sunlight striking the panels is chemically converted into direct current (DC) electricity.
  2. The DC electricity goes to an inverter that transforms it into alternating current (AC) for household use.
  3. The utility meter records the net amount of energy (kWh) consumed. When the system creates more electricity than needed in the home, the meter will "spin backward" and the excess electricity is released onto the electric grid and 'credited' to your utility account. These credits help offset the cost of kWh usage at night or on cloudy days when PV systems are not producing as much electricity.

How can I compare PV panels?

PV panels can be evaluated by cost, efficiency and power capacity. Typically the higher the power rating and efficiency, the higher the panel cost. Discuss with your contractor about the expected performance of each type of panel to understand if the kWh production from a higher efficiency rating may offset the higher cost of the panel.

For more information on evaluating PV panels visit the EnergySage Solar Marketplace.

How do I choose an inverter?

There are two types of inverters: central and micro.

Central inverters – One individual inverter per array. This is the classic technology that is installed with most solar systems. The kW size of these inverters is determined by the total number of panels linked to it. Therefore, any plans to increase the system size due to future appliance additions, should be considered during the initial stages of design. While the main drawback of central inverters is performance limitations, such as shading tolerance, this can be improved with the installation of power optimizers.

Microinverters – One individual inverter per panel. Microinverters allow overall systems to be more tolerant to shade by allowing electrons to bypass any shaded cells, avoiding a severe drop in total production and allowing for more flexible system placement. They more easily allow for future panel additions by simply adding an additional microinverter for each additional panel.

Comparison of Inverter Options

  Central Inverter Central Inverter with Power Optimizers Microinverters
Tolerant to shade No, one or two shaded panels can affect the power output of the total array Yes, a mechanism bypasses the shaded panel Yes, shade from one panel will not affect the other panels in the system
Flexibility in system design Yes, installing a higher wattage inverter can allow for adding panels in one array (azimuth and tilt may be a factor) Yes, panels can be installed in multiple tilts and orientations Yes, the tilt and orientation of one panel will not affect other panels in the system
Cost $ $$ $
Easy system size increases* No, the central inverter is sized to the capacity of the entire system No, the central inverter is sized to the capacity of the entire system Yes, since each panel has its own inverter, your options are open for system expansion
Warranty 10-12 years 10-12 years for the central inverter, 25 years for the power optimizers 25 years
Panel selection Unlimited Unlimited Limited

*If you think you may want to add panels to your solar PV system in the future, it may be more cost-effective to install the infrastructure (racking, wiring, conduit, upsized inverter size) during the original installation.

Will monitoring be included?

Both central inverters and microinverters have the option to include monitoring at an additional cost. If you lease the system or enter into a power purchase agreement (PPA), monitoring will be included in the package. With a monitoring system, you will be able to track your PV system’s production on your smartphone or computer.

Benefits of monitoring your system

  • Panel-level and real-time production visibility
  • Identify system issues/failure quickly to minimize system production losses
  • Easy to troubleshoot cause of system issues

Do solar panels and inverters come with a warranty?

PV panels come with a 25-year production warranty. A central inverter comes with a 10-year warranty, while microinverters come with a 25-year warranty. Most central inverter manufacturers offer a supplementary 10-year extended warranty at an additional cost.

The manufacturer warranties do not cover damage from natural disasters. Adding your solar PV system to your homeowner’s insurance policy is highly recommended.

What size of PV system should I install?

Every site is different and the needs of the system owner vary. System size depends on several factors including how much electricity (kWh) is consumed on site on an annual basis, the orientation and tilt of the system, the available space for the solar PV system and capital.

The first step is to compile your last 12 months of electricity consumption. Next you will want to determine how much you want to save on your electricity bill and how much you want to spend.

Take the next step: System Costs & Incentives