Choosing the Right Solution: Solar Panel vs Solar Inverter

Most of us know the potential of solar energy and how it can help us to save energy bills. However, the workings and technology behind solar energy can be a little confusing. They may be a bit hard to understand. 

Solar panels and solar inverters are different parts of the solar energy system but complement each other. A Solar panel changes sunlight into direct current (DC). At the same time, inverters help convert DC into alternating current (AC) for electrical and electronic devices. They also differ in size, installation, and type.

This article explores the differences between solar panel vs solar inverter. We will also examine how they work and complement each other to power your home.

What Is A Solar Panel?

Solar panels help to turn sunlight into electricity. It is made of photovoltaic cells (PV) and produces direct current (DC). Solar panels are available in many shapes and sizes and are usually seen on people’s roofs and solar farms.

A solar panel, also called a photovoltaic panel, is a device that turns light from the sun into electricity. It is made up of solar cells, which are usually made of silicon and other materials. 

These cells absorb photons from the sun and turn them into electrical energy. Solar panels usually are available in many shapes and sizes, and their power output and efficiency vary. The amount of sunlight turned into electricity is how efficient a solar panel is. 

A solar panel’s power output is generally measured in watts. Common individual panels installed on the rooftop may produce several hundred watts of power.

A solar panel’s performance is usually measured in efficiency. There are a number of things you can do to improve solar panel performance.

These days, the most efficient panels available in the market have an efficiency rating of about 22%. In comparison, the average efficiency of a solar panel is about 15% to 20%.

Solar panels are increasing in popularity because they are a clean, long-lasting, and reliable way to make electricity. They can be used to power homes, buildings, and even whole communities and help reduce our reliance on fossil fuels and greenhouse gas emissions.

What Is A Solar Inverter?

A solar inverter helps to convert the direct current (DC) generated by the solar panel to an alternative current (AC). This allows the AC current to be used by the devices at our home. Solar inverters come in many types and may perform and be priced differently.

A solar inverter is a piece of electronic equipment. It changes the electricity a solar panel makes from direct current (DC) to alternating current (AC), which can be used by appliances and other devices in a home or building. 

There are many different kinds and sizes of solar inverters. They can be put into three main groups: string inverters, microinverters, and power optimizers.

The most common and easiest inverter to use is a string inverter. But if you shade it, its performance goes down.

Each solar panel has its own microinverter, and micro inverters are more efficient than string inverters. If one of the solar panels is shaded, it will only affect how well that one panel works, making it more efficient.

Power optimizers change how much power each solar panel makes and then send the DC electricity to a central inverter, which turns it into AC electricity.

When choosing a solar inverter, it is important to consider the size of the solar energy system, the type of solar panels that will be used, and the needs of the building or home. 

Most of the time, string inverters are cheaper for larger solar energy systems. At the same time, microinverters and power optimizers are better for smaller systems or systems with shading problems.

Solar Panel vs. Solar Inverter

Solar panels and inverters differ in function, material, type, and price. Despite their differences, they are part of a solar energy system and complement each other in function.

As a start, solar panels and inverters are parts of a solar energy system that eventually helps turn sunlight into alternative current energy to power your devices and appliances. 

AspectsSolar PanelSolar Inverter
FunctionConverts sunlight to direct current (DC)Converts DC to alternating current (AC)
InstallInstalled on outdoor spaces, facing the sun.Usually installed near the main switchboard. May also be installed together with solar panels.
MaterialSilicon, Gallium arsenidePlastic, silicon, metal
TypesMonocrystallinePolycrystallineBifacialThin-film panelsString invertersMicroinvertersPower optimizers
Prices$60 to $300$200 to $5,000


A solar panel, also called a photovoltaic panel, is a piece of equipment that turns light from the sun into electricity. Solar cells, which are usually made of silicon and other materials, take in photons from the sun and turn them into electricity. 

The electricity is generated in direct current (DC) form, incompatible with the alternating current (AC) electricity that most homes and buildings use.

This is when the solar inverter comes in.

A solar inverter changes the electricity made by a solar panel from direct current (DC) to alternating current (AC). This makes the electricity used to power appliances and other devices in a home or building. 

As such, solar inverters and panels perform separate but highly complementary functions.


Generally, solar panels are installed outdoors, where they get the most sun exposure. This is because for the panels to generate electricity, they need to be exposed to sunlight. The more sunlight they get exposed to, the more electricity they can generate.

As a result, you may see solar panels installed on the roof or on flat grounds, where they are most exposed to the sun. 

For solar inverters, things may be slightly different. Depending on the types of inverters used, they may be installed in different parts of the solar generation system. 

For example, if the inverter is the microinverter type, it may be installed outdoors, similar to the panels. This is because each microinverters needs to be paired with a panel. As a result, they tend to be installed together. 

However, other types of inverters may be installed indoors, near the sub or main switchboard of the property. This allows you to easily manage the power flow and monitor how the energy generation is going overall.


Solar panels tend to be made of a mixture of materials, such as steel, for the frames. However, the panels are usually made of silicon. It is the second more available element on earth, which, hopefully, will be helpful to keep solar panels’ prices down. 

There are also solar panels made of alternative materials such as gallium arsenide. However, these are less common. Gallium arsenide panels can be 1000 times more expensive than silicon panels.

As for the solar inverters, they are essentially a box with circuitry. If you look into the circuitry, you may notice many capacitors, which temporarily store power and convert the current wave from direct to alternating current.

This means solar inverters may have a metal box with wires and plastic coverings all over the circuitry.


Solar panels are generally separated into several major types:

Monocrystalline: Monocrystalline solar panels are the most expensive type of solar panel but are also the most efficient. Monocrystalline panels are made from a single piece of silicon crystal and may have a sleek, all-black look. They are known to produce electricity per square foot.

Polycrystalline: Polycrystalline solar panels are made from several or more pieces of silicon crystals and are generally seen as inferior to monocrystalline solar panels. 

However, they are known for their affordable price, which may appeal to some. They tend to carry a bluish or greenish color instead of black.

Bifacial: Bifacial solar panels are made to be able to absorb light from both the front and back sides. This means they can benefit from the sun’s position to generate power. You also may not need too much alignment and adjustment on the panels, saving you time.

Thin-film panels: Thin-film panels are made from thin layers of semiconductor materials, usually cadmium telluride or amorphous silicon. They are the least efficient panel but are well known for their flexibility. 

This means they tend to be installed in areas where some form of low cost and flexibility is required. Examples include the rooftop of a bus, or surfaces that are curved, such as a dome. 

There are also several other types of solar panels, such as hybrid and concentrated panels. They perform similar functions, with some differences in efficiency and cost.

As for solar inverters, there are also several types of them:

String Inverters: String inverters may be the most common solar inverters you will find. They are affordable and easy to install. A single-string inverter may be connected to several solar panels.

However, string inverters are susceptible to shading. If one of the solar panels is shaded, the overall power output from the inverter may drop. 

Microinverters: Microinverters work slightly differently than string inverters. Instead of connecting several panels to one string inverter, you will connect a microinverter to each solar panel you have.

The upside of this approach is that if shading happens, only the shaded panel will have reduced power output, while the others are unaffected. This means microinverters are more efficient than string inverters. 

However, microinverters may be more expensive to purchase, install and maintain than string inverters. Using microinverters instead of string inverters on a typical 5KWh home installation could cost about $1,000 more.

Power Optimizers: Power optimizers function similarly to microinverters, with each power optimizer connected to a single panel. However, power optimizers work slightly differently and may be more complex than the other inverters. 

The individual power optimizer unit does not perform the DC to AC conversion. Instead, it optimizes solar panels’ power and sends the DC electricity to a central inverter. 

It is the main inverter’s job to convert DC to AC before sending it to your power grid. It is very efficient but tends to cost more than string and microinverters. 


Solar panels may have a wide-ranging price difference since they can vary in type, size, output, and brand. Generally, you may expect a common 300-watt panel to cost between $60 to $300. 

Similar to the panels, inverters can also vary in pricing, depending on type, size, output, and make. Inverters can range from $200 to $5,000 apiece.

It is common to install multiple panels and inverters, as the most common home solar energy system is around 5KWh. This means your installation cost will go up depending on the number of panels and inverters you use.

Final Thoughts

The choice between solar panel vs solar inverter is an important one. Knowing the differences between the two will help you make an educated decision on how to set your system up correctly.

Solar panels are necessary for turning sunlight into energy while solar inverters are required to convert that energy into a form that can be used by your home.

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