How do solar inverters work?

Inverters do the important task of converting your solar power into usable alternating current. Here’s how to choose the right one for your home.

Photo of a solar inverter and electric meter.

Solar inverters are the part of your photovoltaic system that converts the direct current from your solar panels into the alternating current that your home uses.

While the inverter is a less visible part of your system than the solar panels, they’re equally important. It’s worth taking some time to understand the different types and tradeoffs so you can make the right choice for your project.

What does a solar inverter do, exactly?

Direct current (DC) is electricity that flows in one direction. It’s the type of electricity used by portable electronics, like your phone and laptop. (The power brick for your electronics converts AC power from the wall into DC power.) This is what your solar modules produce, but your home can’t use DC power directly. The North American electric grid uses alternating current (AC) at 60 hertz, which is electricity that switches direction 60 times a second.

It’s the job of a solar inverter to convert the DC power from solar panels into AC power that a home can use. Illustration of how an inverter converts direct current into alternating current

Types of solar inverters

In addition to doing DC-to-AC conversion, inverters for PV systems that are interconnected to the electric grid (as most home systems are) must be able to manage the flow of electricity to and from the grid. These are called grid-tie inverters. As the name suggests, grid-tie inverters allow your photovoltaic system to connect with the public electric grid and provide clean, uninterrupted power no matter how much or little power your panels are generating.

Think of the different situations that can occur. Your panels may be producing more electricity than your house is using, so you have to send power into the grid. Or they might be producing only some of your power needs, so your house is partly powered by solar, and partly by the grid. Or it might be nighttime, and all of your power is coming from the utility. It’s the job of a grid-tie inverter to handle all of these scenarios without your home experiencing so much as a flickering light bulb.

There are also off-grid inverters that are used with battery systems and do not connect with the grid at all. These are outside the scope of this article.

There are a few major types of grid-tie inverters available. Choosing an inverter is one of the important product decisions you’ll make, so it’s important to get familiar with these.

String inverters

Solar panels on your roof can be wired together in one or more “strings” that are connected to an inverter that handles the power output from all of them. (Think of a string of Christmas lights.) This type is called a string inverter, and is the least expensive option.

Lower cost does come with some drawbacks, however.

String inverters can suffer from a problem where a power drop in one panel causes power to drop across the entire string. A power drop could be caused by shadows from any number of things: a chimney, nearby buildings, trees, leaves, soiling from dirt or birds.

Many solar arrays will experience shading for at least some parts of the day, so with a string inverter you’ll likely experience reduced power collection compared with other inverter types.

A string inverter made by Fronius
A string inverter made by Fronius.

Shadows aren’t the only problem. A faulty panel can cause a power drop that has a similar effect.

Some string inverters manage this problem better than others. An inverter has an internal unit called a maximum power point tracker (MPPT) that optimizes the output for a string of panels. The MPPT allows the inverter to extract more electricity from a shaded string of panels. (In technical terms, the MPPT varies the impedance on the circuit to maximize the voltage and current.)

Some inverters have more than one MPPT, each of which can optimize the power output of one string.

If your inverter has two or more MPPT units, your solar array can be wired into multiple strings and the inverter can manage each one individually. This means that if your inverter has two MPPT units, and one of your strings gets some shade during the day, the other string won’t be affected.

One major downside of string inverters is the inability to monitor the performance of individual panels in the system. This means that if you lose power in a string, you won’t know if it’s a single faulty panel or a system-wide issue.

String inverters usually also have a shorter warranty than more advanced inverters. A ten year warranty is typical, but solar panels are expected to last 25 years or more. This means that if you have a string inverter, it would be a good idea to budget for a replacement in the middle of the life of your system.

String inverters also place a limit on future expansion. For example, if you decide in the future to buy an electric car and want to add more panels to charge it with, you will be limited by the capacity of the inverter, and might be forced to upgrade or add another inverter.

With all these drawbacks, why would a homeowner choose a string inverter? Cost is the main reason. Depending on how many panels you have in your system, a microinverter-based system might cost twice as much as one that uses a string inverter.

It’s also less expensive to service a string inverter than microinverters or power optimizers, which are mounted alongside the solar panels and require someone to climb on the roof.

If you have a shade-free roof, a string inverter can generate just as much electricity as more advanced inverters at a lower cost. And even if you have a little shading, the extra electricity you could get with power optimizers or microinverters might not be worth the higher price.

Finally, some string inverters can do nifty things such as supply emergency power in a blackout, even without a battery.

Power Optimizers

A power optimizer-based inverter system is a system with a string inverter and an external MPPT unit, called a power optimizer, for each solar panel. The power optimizers are bolted to the rack underneath each panel.

With this setup, because each panel has its own MPPT, a power drop at one panel affects only that panel, not the rest of the system. This fixes the major flaw of string inverters.

In the US market, the SolarEdge HD-Wave is the dominant power optimizer-based solar inverter.

A power optimizer made by SolarEdge
A SolarEdge power optimizer.

Power optimizers also give you panel-level monitoring, so you can see the power output of each panel and know if there are problems with any of them.

The advantage of power optimizers is they give you better shade-tolerance than a string inverter, and usually at a little lower cost than microinverters.

However, this type of a system has some of the same drawbacks as a string inverter. First of all, the solar panels in the system must still be arranged in strings, and the inverter will usually have a minimum and maximum number of solar panels that can be connected in a string. This means that if you have a complicated roof layout with several planes, these limitations can be a problem.

Also, while power optimizers have better shade tolerance than a string inverter, they still aren’t completely shade tolerant. If too many panels in one string are shaded, the entire string can still be shut down.

Finally, while the most popular power optimizers on the market (SolarEdge) come with a 25-year warranty, the warranty on the central inverter will usually be shorter. In the case of SolarEdge, the central inverter comes with a 12-year warranty. It can be upgraded to 20 or 25 years, but at an additional cost.

This means that if you have a power optimizer system, it would be a good idea to budget for a mid-life replacement of the central inverter.


Microinverters are small, self-contained inverters that are mounted underneath the solar panels in your system. The DC-to-AC conversion happens right on your rooftop, and the wire coming from your solar array carries AC power to your electrical panel. There’s no central inverter in this type of system.

Most microinverters manage the output for just one panel, although some manufacturers have microinverters that manage multiple panels, such as APsystems microinverters that can handle up to 4 solar panels.

Because each solar panel is fully independent from the others, an array with microinverters has the best shade tolerance. It doesn’t matter if one or dozens of panels in your array are shaded. The remaining unshaded panels will still generate electricity.

A microinverter made by Enphase
The Enphase IQ7 microinverter.

Microinverters also give you maximum flexibility with your system laytout, so it doesn’t matter if you have a fancy roof with lots of planes. The panels can go anywhere that your racking allows, with no concern about having to arrange the panels into strings.

This also means that future expansion is easier. Many solar homeowners are also interested in technology like electric cars and heat pumps. If you think you might want to purchase one of these in the future and will want to power them with solar electricity, microinverters will allow you to expand your system as much as your roof allows.

And just like with power optimizers, microinverters give you individual panel monitoring so that you can tell if one panel is underperforming or has failed completely.

With these advantages, microinverters are often the best choice for challenging rooftop installatinos, but you pay for this sophistication: microinverters are usually the highest priced of all the different types of inverter systems.

One possible disadvantage is that even though microinverters are protected from direct exposure to rain and sun by being on the backside of the panel, they are still exposed to the elements. Unlike a string inverter which can be inside your home or garage, microinverters need to be able to stand up to wind, moisture, heat and cold. Vendors do quality testing, but time will tell whether the electronics inside will stand up to 25 years of outdoor service.

Enphase is the largest microinverter company, and they provide a 25 year warranty, which provides some peace of mind. (Read more about warranties below.)

Hybrid inverters

A hybrid inverter is a type of string inverter that incorporates a charge controller for managing a battery system. A charge controller can also be purchased as a separate unit, so a hybrid inverter gives you the convenience of an all-in-one device. Apart from that, it has the same characteristics as a standard string inverter.

Solar panels factory-integrated with microinverters (AC solar panels)

There are vendors that now sell solar panels that ship from the factory with integrated microinverters. These are called AC solar panels. Examples include the SunPower Equinox and the awkwardly capitalized LG NeON 2 ACe line. In both these cases, the inverters are actually supplied by Enphase.

A possible advantage of this approach is lower installation costs. You’ll want to discuss with your installer whether they believe this would be a more cost-effective solution for you.

Solar inverter efficiency

When inverters perform the DC-to-AC conversion, there’s always a little bit of energy that is lost as heat. Cheap DC-to-AC inverters, like the type that plug into your car’s 12v socket, can have very poor efficiency, but solar inverters from the popular manufacturers are highly efficient.

For example, Enphase microinverters are listed as 97% efficient, and SolarEdge inverters are between 97-99% efficient. So the differences are quite minor, and are small enough that you don’t really need to worry about it. Other factors, like shading, have a much larger role in power losses than inverter efficiency.

That said, if you are interested, efficiency is listed on the product datasheet of the inverter. Just like how the California Energy Commission certifies the power ratings of solar panels, they do the same with inverters. You can find the CEC rating on the datasheet for the product.

So, which solar inverter is best?

As you can see, there isn’t a single best inverter for any application. You need to understand the tradeoffs that come with each type, and work with your installer to weigh the pros and cons.

Here’s a table that summarizes the advantages and disadvantages of string inverters, power optimizers, and microinverters:

string• Least cost• Least effective in shade
• Single point of failure
• May limit future system expansion
power optimizers• Handles shading well
• Panel-level monitoring
• Expansion limited by string inverter
• String inverter is single point of failure
• Some components are exposed to the elements
microinverters• Best shade tolerance
• Panel-level monitoring
• Single failures do not impact system
• Easiest to expand in the future
• Highest cost (usually)
• Units are exposed to the elements

Pricing will vary by installer

While it’s true that string inverters will generally be cheaper than microinverters, your pricing will ultimately be determined by the installer. It’s entirely possible that your installer will be able to get you better pricing on microinverters than a power optimizer-based system. Just ask your installer to price the different options.

Inverter sizing: input and output power

Inverters have two power specifications: the input power that it will it handle, and its maximum output power (in AC).

This means that if your string inverter lists a maximum input power of 5,000 watts, you can connect a maximum of 5,000 watts of solar panels to the unit. However, the nameplate power rating (the STC rating) of a solar panel is rarely achieved in the real world. A panel’s output in day-to-day use might be around 20% less than that at best.

SMA, an inverter company, recommends that you size your system so that the solar array’s STC size is larger than the inverter’s rated input capacity so that you can save money.

If future system expansion is a possibility for you - say, maybe you’re planning to buy an electric microbus and you want to charge it with solar electricity - and you are getting a string inverter, you may want to hedge against that possibility by going with a larger inverter or asking your installer to plan for adding a second inverter in the future.

This is also a situation where your best choice may be to go with microinverters.

Inverter clipping

One of the most important elements of designing a good solar system is correctly sizing the inverter for the solar array.

You might think that if you have 6 kW of solar panels, you will need a 6 kW inverter. Most of the time that’s not true, and it’s more cost effective to choose a lower capacity inverter, even if it means that sometimes you’ll be “throwing away” electricity.

This is called inverter clipping, and it’s normal for most systems to include some clipping in the design. Here’s what it looks like with my own system:

Example of inverter clipping losses.
Example of inverter clipping losses.

This was a perfectly clear and cold day in the spring, and can you see that in the middle of the day, the power generation went flat. During this time, the system output was limited by the inverter and not the solar panels.

Inverter clipping, also known as the DC-to-AC ratio, is a normal part of a good system design. You can read more about it in this article.

How much do solar inverters cost in 2021?

Just to give you a ballpark idea of what the retail price for inverters are in 2020, the table below gives an example for each of the major inverter categories. Keep in mind that your installer is working in bulk quantities and may have direct relationships with suppliers, so their cost will almost certainly be lower.

ModelTypePrice (approx)
SMA Sunny Boy 6.0string$1,525
SolarEdge SE6000H HD-Wave string inverter for power optimizers$1,690
SolarEdge P320power optimizer$79 (per panel)
Enphase IQ7+microinverter$152 (per panel)
Enphase IQ Envoymicroinverter remote monitoring$525

You should check with online retailers for latest pricing.

Remember that inverters are part of the total system cost, which means that they are covered by the incentives available to you.

Monitoring your solar output

Once you’re up and running with a home PV system, you’ll naturally want to be able to monitor it to find out how your investment is performing. First of all, it’s a great feeling to check your system on a sunny day and see thousands of watts of power being generated. But it’s also important to periodically check that the components of your system are working correctly. Some inverters will do this automatically, and email you if power drops out in any part of the system.

Any inverter will provide some method of monitoring the system, and many provide web or mobile apps. Here are some public or demo accounts from some of the major manufacturers that you can view to get a better idea of the functionality provided.

Enphase demo (The Solar Nerd home!)

SolarEdge monitoring demo

SMA monitoring demo

Keeping the power on during a blackout

If you don’t have a battery system, grid-tie inverters do not supply power to your house when the grid loses power. Even if it’s bright and sunny, in a blackout your inverters will switch off when they can no longer sense power from the grid. This is because they need to synchronize with the 60 hz grid frequency, and also to prevent your system from putting electricity into downed power lines, posing a hazard to utility repair workers.

There is one exception on the market, however: the SMA Sunny Boy inverter series comes with a feature they call Secure Power Supply, which can provide up to 2,000 watts of power to a special outlet connected to the inverter.

This means that the inverter won’t seamlessly switch over your home to solar power in a blackout, as would happen with a battery backup system. Instead, you have to go and manually plug in the devices you want powered into the inverter.

Also, the manual for the Sunny Boy inverter mentions that this feature isn’t suitable for anything that requires a stable electricity supply, which means that plugging in your computer or other sensitive electronics would be a bad idea. The inverter in this case is powered directly by the panels with no batteries to buffer the supply, so a dip in power from a passing cloud would cause the power to fluctuate.

Still, this could be a handy feature to keep some key appliances running during the daylight hours of a blackout - your refrigerator, for example. 2,000 watts is also just enough juice to run one space heater or a small air conditioner, so it could help keep you comfortable while you wait for the utility company to make repairs.

Inverter companies and their warranties

The list of inverter companies is shorter than the list of solar panel manufacturers, so it’s likely that you will end up with an inverter from a company on this list. These are some of the more popular ones in the US market.

The warranties listed below are for residential products.

ABB10 years
Schneider10 years
SMA10 years
SolarEdge12 years on inverters, 25 years on power optimizers
Enphase25 years on microinverters, 5 years on IQ Envoy (monitoring)

As we mentioned in the previous article about solar panel warranties, a 25 year warranty does you no good if the company is out of business. For example, there have been concerns about the financial health of Enphase, although they appear to have turned things around in recent quarters.

Bottom line: work with your installer to choose the best inverter for your project

Because of all their advantages, a majority of home solar installations now use power optimizers or microinverters. Even so, there are cases where a string inverter might be the right choice for you.

The technical aspects of all this might seem a little intimidating, which is why it’s important to choose a solar installer that you are comfortable with. A good installer will take the time to answer your questions and give you objective answers to your questions.

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