Solar Inverters | Micro, String, Off-Grid Inverters Explained — Treepublic Solar

Solar Inverters | Micro, String, Off-Grid Inverters Explained

Solar energy provides clean, stable, renewable power for use in homes, offices, and industrial complexes all over the world.  Solar panels soak up the sun from rooftops and fields, and transfer that energy through solar inverters.

The solar inverter acts as the nerve center for the entire solar energy system.  It is the solar inverter that converts energy collected from the solar panel, known as direct current (DC) to usable alternating current (AC) that powers such things as lights, TV’s, refrigerators, and washers and driers.

DC to AC for Residential and Commercial use

DC current generated from the solar panels themselves gets converted to usable energy for immediate use.  It may also be stored in a bank of batteries depending on the type of solar inverter involved.  In its raw form direct current cannot be used for home or commercial energy needs, thus the need for conversion to AC.

Solar Inverters—String, Micro, and Off-grid

Solar inverters have one principle function, to convert direct current generated by the solar panels to alternating current, for use in the house or commercial space.  There are several different types of solar inverters however, depending on the needs of the consumer, type of installation, and location of the residential or commercial space.

Some inverters indicate how well the overall solar system is performing and can monitor energy efficiency throughout the conversion process.

Inverters are sophisticated pieces of equipment and can provide diagnostic information to help identify problems or inefficiencies.  This makes for stable power grids and takes over some of the decision making for solar consumers.  Some solar inverters also help with battery management.  This allows for more efficient systems and maximum power output from the (PV) photovoltaic system.

String Inverters

String inverters involve solar panels installed in a series of rows. Generally, several “strings” of solar panels are connected to one string inverter.  The DC power generated from each of the solar panels produces usable AC power.  Depending on the size of the home or commercial space, some solar installations require more than one inverter to convert several strings of solar panels to energy.  When this is the case, performance is monitored at each string.


String inverter technology has been in the marketplace the longest and is less expensive than other solar inverters including microinverters.  String inverters are used for both residential and commercial structures in small utility installs under 1 Megawatt (MW).  String inverters offer excellent power density in smaller sizes.


While string inverters include some of the first solar inverters on the market and are also among the most common, there are a few drawbacks.  String inverters, while efficient in areas with consistent sunlight are not designed to work well under other conditions.  If one panel is in shade at any time throughout the day, the remaining panels on the string will operate at reduced capacity as well.  Panels connected to string inverters cannot be placed on different planes or face different directions.


Microinverters have become popular in recent years for both residential and commercial applications.  Microinverters are installed on each individual solar panel.  These are considered module-level electronics that convert direct current to alternating current at the panel level.  Because microinverters are connected to each panel, no other inverter is needed. 


An important advantage to microinverters is their ability to function individually. When one solar panel is shaded and working at less than optimal levels, the other panels will continue to maintain maximum output.  Microinverters work well for solar panels facing different directions and for those located on multiple planes.  Microinverters also monitor the efficiency of each individual solar panel.


There are definite drawbacks to microinverters for solar use.  Generally, up front costs are higher than those for string solar inverters.  There are also many more components involved in microinverter solar energy systems.  Failure rates may be higher based on the complexity of a microinverter system as a whole.

Off-grid Inverters

An off-grid solar power inverter differs from other solar energy inverters.   Off-grid solar inverters must incorporate a battery bank to function.  These are widely used either in conjunction with another energy source or alone to provide power to remote areas, camps or cabins.  Solar panels collect the sun’s rays and generate DC power that is stored in batteries.  From the batteries, the inverter works by “inverting” this energy and creating usable alternating current (AC).  The sun further charges the battery bank as sunlight hits the solar panels.  In this way, a small power grid is created.  An off-grid solar energy system also utilizes a charge controller, battery monitor, and AC and DC circuit breakers.  Off-grid inverters are generally more complicated to wire and install.


Many advantages to off-grid systems include a reduction in electricity costs and a surefire way to avoid power outages.  Power can be generated in rural locations or in wilderness areas not on a regular power grid.


These include cost.  Off-grid solar inverters can be expensive initially and batteries are required for the system as well.  Sometimes these require outside maintenance and tend to have a short life span overall.

Can I Recoup Some of the Cost by Getting Rebates or Credits?

The answer is yes.  There are many incentives and plans in place to help reduce the cost of solar equipment and solar installation.  These include a combination of federal, state, and local credits and rebates depending on the area and type of installation.

A tax credit consists of a dollar for dollar credit in the owed amount of income tax.  This affects net liability overall. 

Federal Tax Credit

  • The federal government allows for a federal income tax credit under the Investment Tax Credit program (ITC) to help offset some of the cost of a solar photovoltaic (PV) system.  A tax credit of 22% for a residential or commercial solar installation is available through the year 2021.  This federal tax credit will expire in 2021 (unless it is renewed by Congress).  There is no maximum dollar amount for solar installation at this time. 

Restrictions and Rules

  • In order to comply with IRS rules for the federal solar tax credit the solar system must be installed, in service and able to generate electricity for a residence or commercial space located in the United States.

Eligibility for the Federal Tax Credit

  • Solar PV system must be installed between January 2021 and December 31, 2021. (Commercial can deduct 10% of cost in the year 2022).
  • System is installed in your primary or secondary residence in the U.S. or in your commercial space.
  • Can be for an off-site community solar project (if credited to the home’s consumption of electricity).
  • You must own the solar PV system (not lease).
  • The solar PV system is new and it is the original installation.

Equipment Eligible for Federal Tax Credit

  • Solar PV panels
  • PV cells powering attic fan 
  • Permit fees
  • Inspection fees
  • Assembly
  • Installations
  • Developer fees
  • Wiring
  • Solar inverters
  • Mounting equipment
  • Energy storage devices charged by solar PV panels
  • Applicable sales taxes

Some appliances such as solar water heaters for water consumption in the home may also be eligible for federal tax credits as well.[1]

State and Local Tax Incentives

Many states offer one-time credits for newly installed solar PV installation to reduce the overall cost of a new solar installation and equipment.  A state tax credit for solar installation does not reduce the amount of federal tax credit you receive.  Some states even require renewable energy installations for new and retrofitted building projects.

Utility Rebate

Many utility companies offer rebates for power consumers who install solar PV systems as well.  This is usually subtracted from solar system costs before tax credits are applied.[2]

Before expecting a rebate or tax credit for a new solar energy system installation, check with your local utility company and federal, state, and local government for programs.

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