Adding solar power to your home can help you save big on energy costs, but it can be a daunting investment. We break down the entire process for you here.

In a country that gets as much sun as Australia, it's no wonder that household use of solar power is becoming increasingly popular. Though they were once seen as too expensive, solar photovoltaic (PV) systems are now an affordable choice for Aussies who want to reduce their power bills and generate their own environmentally friendly electricity.

There are many benefits to installing a solar power system in your home. Australia has the highest solar radiation per square metre of any continent and solar power is a sustainable option that collects free energy from the sun and converts it into clean electricity. It's also a great way to reduce your carbon footprint by avoiding more-traditional forms of energy powered by fossil fuels.

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What you need for a solar power system

Every solar power system needs to be customised for the home it's being installed on, as well as the household's energy needs. While there are a lot of variables that need to be considered, there are three critical components to any solar PV system.

• Photovoltaic panels: These are the panels that convert the sun's energy into electricity.
• Inverter: This converts the panels' direct current (DC) into a 240V alternating current (AC), so you can use your solar energy to power your home's electricity.
• Racking: This is the equipment used to attach the solar panels to your home's roof.

To make things a little more confusing, there are different types of panel technologies available and multiple types of inverters. Then there are additional elements like batteries and feed-in tariffs to consider. We'll break all this down for you on this page, but your solar installer should be able to guide you through the more difficult decisions.

Solar panels: Polycrystalline vs monocrystalline

Before we dive into what makes these two panel types different, it's worth noting that for most installations in Australia, this decision doesn't matter too much. Because of our climate, both polycrystalline and monocrystalline panels offer similar performance, though there are higher-quality products at a range of prices that should be considered.

To showcase the differences, we've put two similar Trina Solar panels side by side so you can see the differences in the technologies below.

	Monocrystalline (e.g. Trina Solar Honey Mono 300W)	Polycrystalline (e.g. Trina Solar Honey Poly 280W)
Panel efficiency	17.1% (Typically 15–20%)	17.1% (Typically 13–16%)
Dimensions	1,640 x 992 x 35mm	1,640 x 992 x 35mm
Weight	18.6kg	18.6kg
Peak power (Watts)	300W	280W
Example price*	$157.28	$132.99

• Read more about Polycrystalline vs monocrystalline

  Monocrystalline panels are generally the more efficient type of panel and can produce a slightly higher power output to a polycrystalline panel with the same footprint. This also means they're typically more expensive than other types of panel.

  Polycrystalline panels are easier to manufacture than monocrystalline, which makes them generally cheaper to purchase. But because they aren't as efficient as monocrystalline, you may need more panels to generate your household's power, which could become an issue if roof space is limited.

  Realistically though, for most Australian homes there's no obvious benefit to either technology. You may need a couple of extra poly panels to have the same overall production capacity, but unless you have a severe limitation on roof space, that's unlikely to make a difference.

  Visually, you can tell the difference between the two by looking at the PV cells: mono panels have rounded edges on each wafer and are typically black in appearance, whereas the poly panels are pure silicon rectangles that look blue.

  There are a couple of other technologies out there as well. Thin-film solar panels aren't generally suited to residential solar installations thanks to a fairly low efficiency, though they are cheap to manufacture.

  There's also a budding market for photovoltaics that are integrated into a part of the building, rather than being a separate panel attached – a good example is Tesla's Solar Roof, where the PV's silicon is built into the glass roof tile.

  For the vast majority of people though, this type of solar panel is still way too expensive to be a viable option.

  * Price per panel found online on 13 March 2019

Solar inverters: String inverters vs micro-inverters

The second key component of your solar system is the inverter. Inverters are responsible for converting the DC produced by the solar panels into an AC that can be used by your appliances.

Again, there are two main technologies to consider for an inverter. Below are some pros and cons for each:

	String inverter (e.g. SMA 2-MPPT 5000W)	Micro-inverter (e.g. Enphase M250 240V)
Price	One unit per system, generally cheaper	Need one per solar panel, can add significant cost to a large solar system
Safety	Single point of failure dealing with large voltages, so potential fire risk	Current converted at each panel, so lower risk of overall failure
Extending	Difficult to add additional panels	Easy to add more panels over time
Performance	System can only perform as well as its worst-performing panel	Each panel outputs full potential to system, so more efficient power overall
Alignment	All panels need to be aligned to maximise output	Panels can face different directions because performance isn't tied together
Troubleshooting	If one panel fails, can be difficult to determine which one	Each panel can be monitored and issues identified easily
Replacement	Easy to replace if it fails	Can be difficult to replace given location on roof

• Read more about inverter technologies

  A string inverter is a box that's mounted on your wall. No bigger than your carry-on luggage, it's a single device that connects to your solar panels in a series circuit – that is, all the panels connect in sequence before connecting to the inverter.

  This is important, because it means that your entire solar system can only perform as well as the worst-performing panel will allow it to, because all the electricity needs to run in a circuit.

  Micro-inverters are much smaller than a string inverter, about the size of a notebook. You'll need a separate micro-inverter for each solar panel in your system with each one connected in a parallel circuit. This means you can get the best possible performance from each solar panel, without having one under-performing panel drag down the output of your whole system.

  It may sound like micro-inverters are definitely the way to go, but it's not that simple.

  In addition to these two types, there's also a third possibility of using a string inverter with individual panel optimisers to overcome many of the challenges faced by a string system.

  While it may appear that micro-inverters are the way to go on paper, in reality it will largely depend on your budget and the requirements of your installation, so make sure you speak through your options with your installer.

Solar racking

If you're about to spend thousands of dollars attaching solar panels to your roof, you should pay attention to the racking that will be used to keep them secure.

While there are a number of products and manufacturers available, the most important things to be aware of are ensuring the racking is correctly wind rated for your area.

This means if you live in an area prone to cyclones, you want to make sure your racking is rated for cyclonic winds, otherwise your expensive solar system could blow away.

High-quality solar racking for Australian homes is generally rated for all wind types in Australia, but you should do your research and make sure anyway. While your installer will help guide you in this decision, know that some racking may not support both portrait and landscape installations, while others may only be appropriate for certain roof types.

How big should your solar system be?

Now you know what's required for your solar system, the next step is to determine what type of system you want and how much energy it will produce.

Naturally there are lots of elements that can impact this decision, like your budget, your retailer and even the size of your home. Let's break it down, step by step.

Choose your system

For most Australians, there are three main types of solar systems to consider:

Most Australian homes with a solar PV system currently have a grid-connected system, though hybrid systems with a battery backup are becoming more popular as the price of solar batteries comes down.

Off-grid systems really are limited to remote locations. Even if you invest in a large hybrid solar system with a view to stop using grid-electricity, it will likely still be connected to the grid in the majority of cases.

• What size system?

  There are two main factors that will ultimately determine what size solar PV system you should get: available space for the panels and your budget.

  Because of the price of modern solar panels, the leading theory is to install as many panels as your rooftop and budget will allow.

  There are a few reasons for this, but predominantly it's about future-proofing your system. It can be difficult to add solar panels to an existing system (especially if you have a string inverter) and as electricity prices rise, being able to offset that with solar power will help you manage electricity costs in the long term.

  It's also worth noting that limiting your system to directly match your consumption doesn't take into account the variance in seasonal electricity production – you'll generally generate more electricity in summer than winter, thanks to the longer days.

  Your Distributed Network Service Provider (the company that distributes your electricity between generator and retailer) may have some limitations around the size you can install and some retailers have limitations on the amount you can feed in to the grid as well.

  And obviously, you can only afford to install a system within your budget. To that end, it's worth considering how much energy you use and when you use it to understand how quickly the savings from your PV system will pay for its installation.

• Calculate your usage

  In order to best calculate how long it will take for your solar PV system to pay for itself, you should first take a closer look at your current usage.

  Not only do you want to understand how much electricity you typically use per day, but also pay attention to the time of day you typically use your energy. This is important because unless you invest in a hybrid system, you can only use electricity from your PV panels during the day as they generate it.

  If you typically run all your appliances at night, the benefits from your solar system won't be as pronounced and it will take longer for the system to pay for itself in energy savings.

  This is because the cost of importing electricity from the grid is always higher than the price for exporting it. Typically, you'll pay around 20c to 40c per kWh for electricity from the grid, but feed-in tariffs range between 0c and 20c per kWh.

  So if you can use the electricity from your solar PV panels rather than using it from the grid, you're almost always going to be better off and your system will pay for itself sooner.

  Your electricity bill will generally give you an indication of how much electricity you use per day and homes with a smart meter installed should be able to see more-detailed time-of-use information.

  If you don't have a smart meter, regular meter readings in the morning and night time should give you enough information to help inform your decision.

• Should you get a battery?

  Solar batteries have been around for a while but they're becoming more and more popular thanks to the arrival of high-profile brands launching products like the Tesla Powerwall 2.

  Compared to the cost of a standard grid-connected PV system, hybrid systems with a battery backup are still expensive.

  While a standard PV system will most likely have paid for itself in 4–8 years (depending on location and usage), adding a battery to the system can extend that payback period to well over 10 years, especially with a premium product like Tesla's Powerwall.

  Given that most batteries have a warranty of 10 years, the consensus is right now it doesn't make financial sense to install a battery system because you won't see the benefit until after the battery is out of warranty, at which time it will likely need replacing.

  That said, the cost of solar batteries is expected to halve within the next seven years, according to the CEC. So it may be worth considering a battery-ready hybrid system and buying the battery in a few years when the costs have come down.

How much does installing solar cost?

Now you have a bit of an idea about the type of solar photovoltaic system you want to install, it's time to budget. It's important to know there's no fixed price for any solar system installation. The costs you're quoted will depend on the size and capacity of the system being designed, the quality and brand of the products used and the difficulty of the install.

Then there are potential additional costs, like upgrading your meter or your electricity switchboard.

As such, it's important to get multiple quotes from CEC-accredited installers.

But to give you a general outline of potential price ranges for a standard grid-connected PV system, Solar Choice has compiled its list of average install prices across Australia for different solar system sizes.

For February 2019, the average out-of-pocket install price (deducting any relevant government solar rebates) looked like this:

Importantly, these numbers are averaged across all of Australia. Some states don't offer any type of rebate on a solar system install, so those prices could be higher, depending on your location.

How long will it take for my solar PV system to pay for itself?

Naturally, the time it takes for your solar system to pay for itself from reduced electricity costs depends on everything from the size of your system and the price you paid to your energy usage habits and consumption, plus your electricity plan's rates for both consumption and production.

It's also significantly impacted by where you live, as that can have a big impact on the typical amount of energy your panels will produce, as well as the rebates available and the feed-in tariff options.

According to the Australian Energy Council's January 2019 Solar Report (pdf), these are the expected time frames for a solar PV system to pay back its upfront cost across Australian capital cities:

Feed-in tariff plans

Once you've had your solar panels installed, one of the first things to do is to take a good look at your energy plan. Chances are the plan you were on before adding solar panels isn't the best plan for you now you're generating your own electricity. One of the most important features of an energy plan to consider once you have solar panels is the feed-in tariff, sometimes referred to as the "FiT".

This refers to the amount of money your energy company will pay you for the excess electricity you create that's fed back into the grid.

FiTs can vary quite dramatically, depending on where you live and the retailer you choose. Some retailers offer relatively generous FiTs, but also charge higher rates for any electricity you use from the grid, while others offer lower FiTs (or no FiTs at all).

Understanding your usage is important when selecting the right electricity plan with a FiT, because as we mentioned above, the cost of electricity from the grid is almost always more than the amount energy companies will pay you.

How to compare solar products

To find the best solar product for your home, compare different makes and models of solar PV panels based on the following features:

• Clean Energy Council certification. Are the solar panels certified by the Clean Energy Council (CEC)? Certification ensures the solar product has been manufactured according to industry best practice and it adheres to Australian standards. You can claim government rebates like small-scale technology certificates for CEC certified solar panels installed by a CEC accredited installer. You can check to see whether solar products are certified by searching a database on the CEC website.
• Warranty. What is the manufacturer's guarantee and how does this compare with warranties from other manufacturers? Look out for where the solar products were made and whether that particular brand can be serviced and repaired within Australia.
• Lifespan. What is the expected lifespan on the quotes solar products? Some systems will last longer than the others.
• Solar manufacturer reputation. How long has the brand been in business? Consider the likelihood that the brand will still be in business if government rebates schemes change. You can usually take confidence in the length of time a product has been on the market.
• Solar system output. What is the projected output for the PV solar system? The capacity to generate electricity varies depending on the size of the system. A 4kWh solar system has the capacity to generate more electricity than a 1.5kWh system; however, the actual amount of electricity the solar product generates depends on a number of factors such as sunlight exposure, temperature and position. Be sure to account for factors like electricity losses from the inverter and wiring which can contribute to a loss of as much as 20%.
• Solar panel efficiency. What is the solar system output compared to the amount of space covered by PV solar panels? Smaller roofs may require a system with high efficiency to get the best result while a less efficient system on a larger roof may give the same result.
• Cost per kilowatt. Your quote should include a cost per kilowatt figure and a cost per kilowatt hour of delivered energy calculated over a solar year. Compare this figure against the price you pay to buy electricity from the grid. Remember that electricity prices will more than likely increase in the future and be conscious that solar inverters generally last for about half the life of PV solar panels.

Solar power FAQs

• Which way should solar panels face?

  For the best possible performance, your solar panels should face north, although modern solar systems can be pretty versatile.

  If your roof faces north-east or north-west, you can expect to only lose 3–4% of the power compared to north-facing panels.

  If your roof faces east or west, then you could lose up to 15–20% of your overall power. South-facing panels will struggle to take advantage of the daylight.

  That said, one of the benefits of modern solar power systems is you can optimise each panel's performance, making it possible to place solar panels on multiple roof faces to maximise the capacity of your system without negatively impacting your overall power output.

  You should talk to your installer about your options, regardless of the direction of your roof.

• Can I get paid for the energy I produce?

  If your solar system is grid-connected (which most residential installations will be), then it may be possible for you to sell your excess energy back to the grid.

  You do this through a feed-in tariff, which means you feed in your electricity to an energy retailer that re-sells it to other customers across the country.

• Are you entitled to rebates?

  In order to incentivise solar panel installation, state governments may offer a dedicated solar energy rebate.

  The rebate itself can vary greatly between states, but is generally a good way to help offset the upfront cost of installing a solar power system. Before you start your solar installation, make sure you research what solar rebates you're eligible for in your state.

• How long will my solar power system last?

  Pretty much every solar panel sold in Australia has an output warranty of 25 years, meaning you can expect to be generating electricity for at least a quarter of a century. After that time, the performance of the panels begins to degrade, so it might be worth looking at upgrading.

  The most common point of failure for a solar PV system is the inverter. Most quality inverters come with a 10-year warranty, so you should expect to replace the inverter a couple of times throughout the lifespan of your system.

• Do I need a new electricity meter?

  In most cases, yes. Grid-connected solar panel systems need to track both the electricity being consumed from the grid, as well as the energy you produce and feed back into the grid, so your home will need a bi-directional smart meter. The majority of smart meters currently in use don't support tracking energy in both directions, so will likely need replacing. If in doubt, check with your installer.

• What happens during a blackout?

  Even if you have a battery backup installed, your solar system will generally switch off in a blackout. This is because it's unsafe to have electricity being passed into the grid while technicians work on fixing the network.

  You can customise your installation to allow you to draw on battery power during a blackout, so if this is an important feature for you, make sure you discuss it with your installer.

• Can I insure my solar system?

  Most insurers allow solar PV systems to be insured as part of their home and contents policies. Check with your insurer to see what options are available to you.

• Do I need planning approval to install solar panels?

  Generally, you don't need any approval to install a solar PV system on your home. There are exceptions though: if your home is heritage listed or if you have a strata agreement, you may need to get approval. Speak to your installer if you have any concerns, they will generally be able to guide you through any necessary approval process.

Nick Broughall

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Nick is the group publisher for tech, telco and utilities at Finder. An award-winning journalist with over 15 years' experience writing about technology, Nick has edited some of the country’s leading tech publications, including Gizmodo, TechRadar and T3 Magazine, as well as contributing to the likes of the Sydney Morning Herald, CNET, Lifehacker, news.com.au and many more. In 2016 he was awarded the Best Reviewer title at the 14th Annual IT Journalism Awards and has been a finalist for Best Reviewer, Best Consumer Technology Journalist and Best News Journalist on multiple occasions. Nick has a Bachelor of Media from Macquarie University and finds joy in solving problems with technology.

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