How do solar panels connect to the grid?

In this article, we explain what it means to connect to the grid, and the difference between an on-grid and off-grid home.


One of the fundamental concepts of home solar is grid interconnection - otherwise known as connecting to the grid.

What does this mean? First, let’s define exactly what “grid” means. When talking about home solar, the grid refers to the power grid, also known as the electric grid. It is the collection of machinery and wires that generates electricity and brings it to your home.

There are two parts to the grid: generation, which consists of a variety of power plants such as coal plants, gas turbines, nuclear power plants, wind turbines, hydroelectric dams, and solar panels.

The other part is transmission, which is the infrastructure needed to carry electrons from power plants to your neighborhood. Transmission consists of substations, transformers, and the wires that connect to your home.

Here’s an infographic that describes it in detail (click to open in a new window):

Infographic with an overview of the electric grid / Energy.govEnergy.gov

Home solar panels and the grid

When a homeowner decides to add solar panels to their home, in most cases they will choose to be grid connected. This means that the home will get electricity both from its solar panels and the electric grid.

This is important because solar energy is intermittent: it stops working when the sun goes down. When this happens, a grid-connected solar home will automatically use electricity from the grid to meet its electricity needs. This process happens automatically and is seamless to the homeowner.

In the other case, when solar panels generate more electricity than a grid-connected home needs, it will send its extra electricity into the grid. That solar electricity will then get used by the neighborhood. No electricity gets wasted.

Net metering and grid-connected homes

On a sunny day, it’s common for solar homes to send excess electricity into the grid in the middle day when power generation is at its peak. How you receive credit from your utility company is dependent on a policy called net metering.

Adequately describing net metering requires an article by itself - which you can read here - but the graphs below give you a quick idea of what it looks like over the course of a day.

Illustration describing how net metering works.

In the first graph, you can see that when the sun isn’t shining, a solar home will pull power from the grid, and tend to generate excess electricity in the middle of the day.

With net metering, you get full credit for the extra electricity sent into the grid, which is used to offset any power that you need to draw from the grid at night or when solar power generation is low.

Keeping track of your electricity usage

Regardless of whether your utility company offers net metering or a different scheme (such as net billing), if you have grid-connected solar, you will need a new electricity meter from your utility company. It’s this utility meter that will let them know how much solar electricity you generate and how much grid electricity you use so that you can be billed for the difference.

You might get a bidirectional meter installed, which will track in real time whether you are using electricity from the grid or sending excess solar power into the grid.

Or you might have a dual metering setup, in which one meter tracks power drawn from the grid and a separate meter that tracks the solar electricity generated.

Which type of setup you end up with will depend on your utility company.

The utility interconnection process

As mentioned earlier, the majority of solar homes are grid-connected. This means that part of the process of having solar installed is getting permission from the utility company and applying for grid interconnection.

In most cases, your solar installer will take care of the paperwork for you. There’s usually no work for you except for supplying your signature.

The interconnection process also typically involves an onsite visit for an inspection. With utility companies that offer solar rebates, the inspection is often a qualifying requirement. If you’re curious, your utility’s website will often have the interconnection agreement forms available for you to look at. In most cases, the requirements are technical in nature and specify the wiring and equipment requirements for the solar PV system.

Many utilities charge a fairly small fee for the interconnection application, which may include a separate fee for the new utility meter. This fee is often in the range of $100 or less.

What is an off-grid solar home?

The alternative to a grid-connected home is an off-grid home. This is one that doesn’t have a connection to the electric utility at all, and is self-sufficient for its electricity use.

Except for rare solar energy euthusiasts, most off-grid homes are cabins and other types of remote vacation homes. In addition to solar panels, off-grid homes may use micro wind turbines, diesel generators, or natural gas generators to supply their electricity.

Off-grid solar homes almost always will use batteries to store their excess electricity. Instead of sending power to the grid when too much solar electricity is being generated, off-grid solar homes send the power into a battery bank. When the sun goes down, the home will use power from the batteries until the sun starts shining again.

If the batteries are exhausted, an off-grid home might fall back to a generator - or simply go dark until the sun starts shining again.

Batteries for grid-connected homes

Because of the falling cost of lithium ion batteries, more and more people are choosing to have solar homes stay grid-connected, but also use batteries to minimize their use of grid electricity. This gives you the energy-independence of being off-the-grid, but with the flexibility of being able to fall back to grid power when needed.

There are couple reasons why you might want to do this.

One case is when you have a time-of-use plan or net billing plan with your utility company. In these cases, the pricing structure may be such that it’s more financially favorable to consume your own electricity instead of drawing from the grid, even when the added expense of batteries is added in.

The other may be that you live in an area that experiences frequent blackouts. If that’s the case, having batteries will keep your lights on while the rest of the neighborhood is dark.

There are a lot of different types of batteries aimed at the solar market, and many manufacturers developing products. Read our guide to solar batteries to learn more.

Terms

Hopefully this cleared up some confusing terminology for you. To recap, here’s some key terms:

  • Grid-interconnection: the application process with your utility company to allows your solar PV system to have a two-way connection with the power grid.
  • Grid-connected home: a home that relies on the utility company for electricity.
  • Off-grid home: a home that doesn’t use electricity from the grid, but instead relies on technology such as solar panels, wind turbines, generators, and batteries for its electricity needs.

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