Most solar systems are connected to the power grid and are known as "on-grid" systems. Those which are completely removed from the power grid are called "off-grid" systems.
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The main difference between the two systems is how you can access power, and whether or not you can store it.
The main components of power generation are:
Excess energy is fed back into the main power grid. Depending on your energy plan, you will be paid a feed in tariff for each kWh of power you send back to the grid.
Your house will automatically draw power from the mains electricity grid. Each kWh of power used will be charged at the rate specified on your power plan.
Your system will stop working when there is a power failure on the main grid, even during the day. This reduces the risk of electrocution to repair workers.
You will be billed monthly or quarterly by your provider, depending on your plan. Your total bill will be your mains power usage charges minus any feed in tariffs, plus supply charges and any other fees.
The components for an off-grid system are the same as for on-grid, plus:
Excess energy is used to charge your battery bank. If your battery bank is full, your solar panels will cut their power production down drastically. Your charge controller will still maintain a small trickle of power to the batteries to maintain charge.
Power will be drawn from your battery bank. Once your batteries are depleted, you'll either need a backup generator or you will lose access to electricity.
Since you aren't using external power, you won't be billed.
Although off-grid systems come with a number of challenges - including a huge upfront cost and the prospect of being left with no access to electricity in extreme circumstances - they have a number of benefits. These include:
Hybrid power systems are on-grid systems that also incorporate battery banks. This allows you to switch to backup power in an emergency, or store up power and feed it back into the grid when you may get a higher feed in tariff.
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