How the components of solar power systems work

Solar power systems can generate, store, and share clean, sustainable electricity using only a few key components—and a lot of sunlight—for 25 years and more.

Knowing this, it should be no surprise that solar energy is the world’s favorite electricity source, garnering majority support from both U.S. and global populations over fossil fuels and other renewables.  

Whether you're looking to reduce your carbon footprint, save on utility costs, or achieve energy independence, this article details how solar power systems work for your home, electric bills, and a more sustainable future.   

Home solar power system components

A solar power system is a simple, yet highly sophisticated assembly of components designed to work with one another—each playing a vital role in the process of converting sunlight into usable electricity.

The three primary components of a solar power system are the panels, inverters, and battery storage. By installing and wiring these components together, you can maximize the financial, environmental, and energy security benefits of your solar power system.

1. Solar panels and mounting materials

Solar power systems that generate electricity consist of photovoltaic (PV) panels to harness sunlight and produce electric current. Solar panels absorb sunlight with silicon semiconductors and generate electricity as direct current (DC).

For permanently installed solar power systems, panels must be securely fastened with mounting materials to withstand potential heavy winds and snow loads. While there are several different types of racking materials for rooftop solar panel installations, PV arrays can also be ground-mounted or even utilized on a shade structure or carport.

2. Inverters and wiring

In tandem with PV panels, inverter systems are a crucial component of a solar power system. Inverter systems convert the direct current (DC) from your PV panels into alternating current (AC), which is the form of electricity standard in homes and the utility grid. After passing through your inverter system, your solar power can then be safely sent to your home's electrical panel and distributed to your appliances and devices.

The physical location and exact operation of your inverter system will depend on your choice between microinverters or string inverters. Microinverters are installed beneath solar panels to reduce high-voltage DC wiring and to maximize system performance, while string inverters are usually mounted on the side of your home, converting solar electricity from all connected panels into AC within one central hub.

3. Battery storage and grid integration

When excess solar power is generated beyond the needs of your property, this electricity can be sent to one of two places: battery storage or the utility grid. While a battery is not mandatory in a grid-tied solar system, a battery is always required for an off-grid solar system, and residential storage is growing in popularity. Batteries provide a reserve of electricity that can be used to continuously power your home with solar energy overnight, on cloudy days, and during local power outages if configured for backup.

How solar power systems save money with energy independence

By producing clean electricity for consumption on-site, solar installations can decrease your dependence on grid-supplied power, leading to lower energy bills and the opportunity to reduce your home’s carbon footprint.

When excess solar power is sent to the utility grid, you’ll receive credit on your property’s energy bills at a rate dependent on local policies and the time of day or week the electricity is shared. Mandatory for utilities in over 30 states, net metering credits can significantly reduce or eliminate grid electricity bills where available, speeding up your solar payback period.

In regions with and without mandatory net metering, homeowners can achieve further bill savings and energy independence with a solar battery. With complete control over solar electricity storage and use, a battery can ensure your home’s major appliances run at the lowest possible costs. Through grid services programs, battery owners can also be rewarded for sharing stored solar power with the utility when local energy demand is the highest.  

While some solar batteries can back up your home’s essentials during local grid outages, not all systems are configured with the same capabilities. Therefore, it’s important to talk to your installer about your energy goals before finalizing your solar power system design. 

Maximizing photovoltaic (PV) panel efficiency

While all your solar power system’s components will influence its total efficiency, the amount of potential electricity it can generate depends primarily on your photovoltaic (PV) panels. There are many factors that determine a solar panel installation’s electricity production efficiency and energy cost savings, including the five listed below.

• Panel technology: The solar electricity production potential of a PV panel is dictated by its wattage and efficiency ratings. Monocrystalline solar panels are the preferred technology for residential installations today, with their sleek black appearance and efficiency ratings between 15% and 24%.
• Sunlight exposure: Solar power systems generate electricity at varying efficiencies based on the amount of sunlight radiation that shine on the panels. Therefore, shading on a solar panel will reduce its electricity production potential and could significantly limit your system’s total output unless protected by power optimizers or microinverters.
• Panel orientation and angle: To maximize efficiency, solar panels should be installed at the optimal orientation and angle possible within the constraints of your property. In the Northern Hemisphere, solar panels ideally face due south at an angle equal to your location’s latitude. With this in mind, there are many suitable roof orientations and angles that can be used to harness solar energy, efficiently produce electricity, and save money on utility bills.
• Temperature: While it may seem counterintuitive, solar panels perform best in cooler conditions, ideally around 77°F (25°C). As the sun can cause solar panels to become very hot, systems must be installed with a gap beneath the PV array to allow for airflow, keep operating temperatures cool, and sustain efficient electricity production.
• Inverter efficiency: After your panels produce direct current, the amount of solar electricity you can use in your home or send to the grid depends on the efficiency of your inverter system. There are several advantages of microinverters over string inverters, including improved system performance and 25-year warranty periods that match expected panel lifespans.

Solar power systems FAQs

Ultimately, understanding how solar power systems work can help you make more informed decisions for your home’s ongoing electricity costs, carbon emissions, and energy security. To wrap things up and cover anything we may have missed, here are some rapid-fire answers to a few common solar power system questions.

Do solar panels work on cloudy days?

Yes, solar panels work on cloudy days at lower production efficiencies. While direct sunlight provides the optimal conditions for solar panels, they can still generate electricity on cloudy days by absorbing diffused light. Depending on the density of the clouds, solar panel efficiency will typically dip to about 10%-25% of ordinary output in overcast conditions.

How does solar power work at night?

As solar panels require sunlight to generate electricity, they cannot produce power at night. For a solar power system to work at night, battery storage is required. By including a large enough battery backup for your solar power system, you can ensure a continuous supply of solar energy to power your essentials overnight.

Can solar power systems work off-grid?

Yes, solar power systems can work off-grid. An off-grid solar power system relies completely on its own electricity generation and energy storage capacity to power your property without a grid backup. As such, an off-grid solar power system requires careful planning to ensure it will meet your energy needs all year long.

How long do solar panels last?

Modern solar panels are designed to be durable and long-lasting, with typical energy production warranty periods of 25 years or more. While the efficiency of solar panels decreases over time, some PV systems can have productive lifetimes beyond 30 years with proper maintenance and care.