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What is a solar inverter and how does it work?

With the increased interest in renewable energy sources across the globe, the interest in solar systems has also shot up at amazing rates. The ability of the sun to power an entire home is a huge environmental plus (think of all the electricity saved!) and is a great use of a resource that we have many hours of each and every week.

But, when it comes to solar systems, do you actually know what they are made up of and how they work? Solar systems consist of solar panels, (or photovoltaic (PV) panels), a solar inverter (super important) and a rack to keep everything in place. They may also contain a battery, depending on the system and an electric meter, and the amount and type of panels for each system will depend on the energy output needed. Considering how important and beneficial solar systems are, we thought we would put together a little information regarding solar inverters, how they work and what to look for in a good solar inverter, given their importance. If you have any questions after you have read this article, call Fallon Solutions on 1300 054 488.

What is a solar inverter?

A solar inverter is one of the most crucial parts of a solar power system. A solar inverter converts the energy output from solar panels into a usable electricity form, to be utilised in your home or workplace.

How does a solar inverter work?

A solar inverter works by taking in the variable direct current, or ‘DC’ output, from your solar panels and transforming it into alternating 120V/240V current, or ‘AC’ output. The appliances in your home run on AC, not DC, which is why the solar inverter must change the DC output that is collected by your solar panels.

To be a little more technical, the sun shines down on your solar panels (or photovoltaic (PV) cells), which are made of semiconductor layers of crystalline silicon or gallium arsenide. These layers are a combo of both positive and negative layers, which are connected by a junction. When the sun shines, the semiconductor layers absorb the light and send the energy to the PV cell. This energy runs around and bumps electrons lose, and they move between the positive and negative layers, producing an electric current known as direct current (DC). Once this energy is produced, it is either stored in a battery for later use or sent directly to an inverter (this depends on the type of system you have).

When the energy gets sent to the inverter, it is in DC format but your home requires AC. The inverter grabs the energy and runs it through a transformer, which then spits out an AC output. The inverter, in essence, ‘tricks’ the transformer into thinking that the DC is actually AC, by forcing it to act in a way like AC – the inverter runs the DC through two or more transistors that turn on and off super fast and feed two varying sides of the transformer.

Types of solar inverters

Now you know what a solar inverter is and how it works, it’s time to look at the different types of inverters. There are 5 different kinds of solar inverters, all with varying benefits :

  • Battery Inverters

A battery inverter is the best option if you are needing to retrospectively fit a battery into your solar system, or are wanting to keep your battery separate from your solar panels and run through a different inverter. A battery inverter converts your battery power into 230V AC and feeds it into your switchboard (instead of grid power) wherever possible.

  • Central Inverters

A central inverter is huge and is used for systems requiring hundreds of kilowatts (or even sometimes megawatts) of volume. They aren’t for residential use and resemble a large metal cabinet, with each ‘cabinet’ being able to handle around 500kW of power. They are generally used commercially for large-scale installations, or for utility-scale solar farms.

  • Hybrid Inverters

Hybrid inverters, otherwise known as ‘multi-mode inverters’, are pretty uncommon in Australia and allow you to connect batteries to your solar system. It engages with the connected batteries through ‘DC coupling’ (when both the solar and batteries use one inverter and the DC from the solar panels charges the batteries via a DC charger) and its electronics organise the charging and discharging of the battery.

  • Microinverters

As their name suggests, microinverters are super small (the size of a book!) and the ratio of solar panels to microinverters is 1:1. The benefit of a microinverter, among others, is that they optimise each solar panel individually, which offers more energy (especially in shady conditions).

  • String inverters

Last but not least, there are string inverters. String inverters are the most common inverter option for residential use, and there is usually 1 string inverter per solar installation. They are known as ‘string inverters’ due to the fact that a string of solar panels is connected to them.

What makes a good solar inverter?

When considering the numerous different inverter brands, types and sizes, there are a few things you can keep an eye out for when it comes to good solar inverters. These include:

Is the solar inverter CEC approved?

The Clean Energy Regulator has a list of CEC approved inverters, which is super important to review. Being CEC approved means it is suitable and approved for Australian climates in accordance with the relevant Australian Standards, and is of good quality. It is also worth checking out the company itself, its history and how long it has been in business. Are they experts in this field, or are they really specialists in another area?

What size solar inverter is best?

This is a question that a lot of people get confused with. For the best clarification we can provide, it is best to get an inverter that is able to handle the max power that a solar power system can produce. For example, if you are after a 3kW solar power system, you will need 3kW panels and a 3kW solar inverter. Now, there are exceptions to this rule, but we won’t get into those here (and they are really quite confusing too!).

Make sure your inverter’s rating in kilowatts is equal to or more than the solar panels’ output

Is the solar inverter weatherproof?

This is a big one to consider when you are looking at where your inverter will be located. If it is weather-proof, this obviously offers you a little more flexibility when it comes to placement but, if it’s not, you may need to consider getting a weather-proof cage for protection (but will cost extra). The general rule is the more protected your solar inverter is, the longer it will last and the better it will perform. Check out the specifications of the solar inverters you are interested in and speak to the solar installation company to find out where they plan to install the inverter.

The solar inverter display

Take a look at the solar inverter display and see how much information is available to be viewed directly on your inverter, or whether there is a remote monitoring option (for example, from a console in your home). Some of the information that may be contained on the display includes:

  • How many hours the system has been producing power
  • The number of kilowatts (kW) the system is currently producing
  • The amount of energy (kilowatt hours) on a daily basis the system is producing
  • The amount of electricity (kilowatt hours) the system has produced since installation
There are even remote options for your mobile devices or computers, so it really depends on your budget and your requirements when it comes to the display.


Make sure you read the rating of solar inverters carefully – they are rated in terms of ‘DC input’ and ‘AC output’, so ensure you choose a system that suits your needs

Solar inverter warranty

This is a very important point! Most grid-connected inverters usually last around 10-20 years, and (realistically) they should all last 10 years at an absolute minimum. Depending on the inverter, warranties usually last around 5-12 years, with some extension options for an extra cost. Take a look at the inverter you would like and its features, and weigh up the need for a longer warranty than what is offered – always remember, the longer the warranty, the more protection you have.

Can I expand my solar inverter?

This is a consideration if you are wanting to expand your solar system in the future. It is best to speak to a solar electrician regarding this, as what you require will really depend on a lot of differing factors (too many to list here!).

Are you going to be connected to the grid?

If you are going to be connected to the grid (where the energy from your solar panels goes to your home or the main energy grid), ensure you review solar inverters with an efficiency of at least 93% (transformer-based) or 95% (transformerless). These are the expected efficiency levels for most good inverter options.

How much should I pay?

This is the trickiest question of the lot, and we can’t provide an exact answer. It really depends on your requirements as to how much you are going to need to pay, with prices ranging from $800.00 to $5,000.00 or more. The one thing we can tell you is this – never buy the cheapest option. They do not last, and you will be buying another inverter long before you should be when buying the cheapest choice.

Your qualified solar system professionals

If you have any questions, or would like to arrange for a friendly electrical technician to attend your home or workplace in Brisbane, the Gold Coast, the Sunshine Coast, Redlands, Moreton Bay, Logan, and Ipswich, call Fallon Solutions on 1300 054 488 or book online today.


Australian Government – Clean Energy Regulator (CEC Approved Inverters): https://cer.gov.au/node/4571

Queensland Government (Buying solar products): https://www.qld.gov.au/law/your-rights/consumer-rights-complaints-and-scams/buying-products-and-services/buying-products/buying-solar-products

Australian Government – Department of the Environment and Energy (Solar PV and batteries): https://www.energy.gov.au/households/solar-pv-and-batteries

Australian Government – Your Home (Batteries and Inverters): http://www.yourhome.gov.au/energy/batteries-and-inverters