Get the Finder app 🥳

Track your credit score


How do solar panels work?

A beginners guide to solar panels.


Fact checked
How do solar panels generate electricity? Watch here
Get a solar quote for your home Enquire now

We’re committed to our readers and editorial independence. We don’t compare all products in the market and may receive compensation when we refer you to our partners, but this does not influence our opinions or reviews. Learn more about Finder.

Solar panels capture light from the sun and convert it into electricity for your home. To help you understand how they do this, we've broken down their function into a few simple steps.

How do solar panels generate electricity? (Video explainer)

As you already know, a solar panel array converts energy from the sun into usable electrical energy. It does this through only a few steps:

  1. Sunlight strikes the solar cells on your panel, generating DC electricity.
  2. DC electricity is collected from all the solar cells into the larger circuit and fed into your solar inverter.
  3. The solar inverter converts the DC current into AC power, so your electronic devices can use it. It also acts as a transformer, scaling the voltage to a safe domestic supply.
  4. Excess power is fed back out into the grid through your domestic power connection. You'll be paid back credits on your solar bill for energy you feed back into the grid.

The science behind solar cells

The sun emits three forms of energy that reach the Earth: heat, visible light and ultraviolet radiation (UV). You may know UV as being responsible for your sunburn when you go out to the beach, and it's also the most energetic part of the sun's spectrum.

Solar cells specifically absorb UV light; heat doesn't help them function at all and too much can actually hurt their efficiency. Your solar cells consist of layers of silicon treated with small amounts of other materials like phosphorus and boron, encased inside metal and glass.

Silicon is a semiconductor, which means that when energetic UV light falls upon it, the electrons inside are pushed into motion through the electrical circuit. This absorption of light is known as the photovoltaic effect, which is why you'll sometimes hear solar cells referred to as photovoltaic cells.

With this movement of electrons, we now have a DC current to feed into the solar inverter.

What are the other important things to know about solar circuits?

  • Solar inverter. The solar inverter provides the crucial function of changing DC to AC via an oscillator circuit. This is a vital step because most devices in your home need more power than DC output can usually provide and rely upon transformers (think about the big block on your laptop charger), which don't work with DC. Depending on the size of your solar set-up, you may have a micro inverter to save space and increase flexibility.
  • Monocrystalline vs polycrystalline. This refers to the actual microscopic structure of your solar cells. A monocrystalline cell has a single, unbroken silicon crystal, whereas polycrystalline cells are made up of shards of silicon joined together. Monocrystalline cells tend to be more efficient because electrons can move more easily through an unbroken crystal lattice, but also cost more than their polycrystalline counterparts.

Connection to the grid

When discussing solar energy, the phrase "connected to the grid" will come up frequently. But what does it actually mean?

The grid allows you to feed excess energy from solar generation, in exchange for money (or credits on your bill).

Australia has two main electricity grids, each composed of two networks: distribution and transmission. The transmission grid is responsible for carrying tons of power over long distances at a very high voltage. The distribution grid is the one that actually delivers the electricity to households and businesses.

When you install a solar set-up on your house, your solar retailer will lodge an application with your power distribution company to get permission to hook it up to the local distribution network. If this is approved, your distributor or retailer will organise any meter changes or reconfigurations required before connecting you up to the grid.

Note: Solar service not available in the Northern Territory, Tasmania and Western Australia.

Speak to a consultant from Solar Run and get a solar quote for your home.

Solar Run is a solar retailer who can help you install solar on your rooftop.

  • Get quotes for solar panels and battery storage
  • Clean Energy Council approved retailer
  • NSW, VIC, SA, QLD and ACT

Solar Run Lender Logos

More guides on Finder

Lower your household bills

Ask an Expert

You are about to post a question on

  • Do not enter personal information (eg. surname, phone number, bank details) as your question will be made public
  • is a financial comparison and information service, not a bank or product provider
  • We cannot provide you with personal advice or recommendations
  • Your answer might already be waiting – check previous questions below to see if yours has already been asked

Finder only provides general advice and factual information, so consider your own circumstances, or seek advice before you decide to act on our content. By submitting a question, you're accepting our Terms of Use, Disclaimer & Privacy Policy and Privacy & Cookies Policy.
Go to site