Understanding Solar Power

Solar power is one of those things that sounds complicated until someone explains it properly. The basics are genuinely simple. Sunlight hits panels, panels make electricity, your home uses it. That's the core of it.

The detail matters though, especially when you're about to spend $6,000-$12,000 on a system that'll sit on your roof for the next 25 years. Understanding how the pieces fit together means you can ask better questions, spot dodgy quotes, and make decisions that actually suit your home.

This guide covers everything from how the panels physically generate electricity through to how your system talks to the grid. Written for people with zero solar knowledge. If you already know the difference between DC and AC, feel free to skip ahead.

The important thing to understand is that your home always uses solar power first. When the sun is shining and your system is producing, your appliances draw from solar before touching the grid. That's where the real savings come from. Every kilowatt-hour you use from your own panels is one you don't buy from the retailer at 30-45 cents.

Your panels produce DC power. Your home runs on AC power. The inverter sits between the two and does the conversion. It also manages power flow, monitors system performance, and communicates with the grid.

There are three main types, and the one you choose affects how your system performs, what it costs, and how it handles things like shading.

String inverters

The most common and most affordable option. All your panels wire together in one or two "strings" that feed into a single inverter box, usually mounted on your garage wall or near the switchboard. Brands like Fronius, Goodwe, and Sungrow dominate this category in Australia.

The trade-off: because panels are wired in series, the whole string is limited by the weakest panel. If one panel is shaded by a tree or chimney, the entire string's output drops. For clean, unshaded roofs this doesn't matter much. For complex roofs with partial shading, it can cost you 10-20% of your production.

String inverters typically have warranties of 5-12 years and lifespan of 10-15 years. You'll likely replace your inverter once during the life of your panels.

Microinverters

A small inverter attached to the back of each individual panel. Each panel operates independently, so shading on one panel doesn't affect the others. Enphase is the dominant brand in Australia for microinverters.

Microinverters cost 20-30% more upfront but deliver 5-20% higher lifetime production depending on your roof conditions. They also come with 25-year warranties (matching the panels) and offer panel-level monitoring so you can see exactly what each panel is doing. For shaded roofs, multi-directional roofs, or if you plan to expand your system later, microinverters are often the better investment.

Hybrid inverters

A string inverter with a built-in battery connection. If you're planning to add a battery now or in the future, a hybrid inverter saves you from needing to replace your inverter later. Brands like Sungrow, Goodwe, and Fronius all offer hybrid models. They cost a bit more than a standard string inverter, but if a battery is even remotely on your radar, they're worth considering from the start.

There are three ways a solar system can be set up relative to the electricity grid. The vast majority of Australian homes use the first option.

Grid-tied (most common)

Your system is connected to the grid with no battery. When your panels produce more than you're using, the excess flows out to the grid and you earn a feed-in tariff. When the sun goes down or you're using more than your panels produce, you draw from the grid as normal. This is the simplest, cheapest, and most common setup. About 95% of new residential solar installations in Australia are grid-tied without a battery.

Hybrid (grid-tied with battery)

Same as grid-tied, but with a battery added. Excess solar charges the battery first, and you draw from the battery in the evening before falling back to the grid. Most hybrid systems also maintain a grid connection as a backup. Some offer blackout protection, meaning they can keep your essentials running during a power outage.

Off-grid

No grid connection at all. You rely entirely on solar panels and a large battery bank, often with a backup generator. This is rare in suburban Australia because it requires significantly more panels, much more battery capacity, and careful energy management. Off-grid makes sense for remote properties where connecting to the grid would cost tens of thousands of dollars, but for most homes it's more expensive and less practical than staying connected.

When your system gets installed, your electricity meter gets upgraded to a bi-directional smart meter (if you don't already have one). This meter tracks electricity flowing in both directions: what you import from the grid, and what you export back to it.

Australia uses net metering for almost all new solar installations. This means you only get charged for the net difference between what you import and export. If you use 20 kWh from the grid in a day but export 15 kWh of solar, you only pay for 5 kWh of imports. Your exports earn the feed-in tariff rate, which is credited against your bill.

This is different from gross metering, where all your solar production goes to the grid first, and you buy all your electricity back at retail rates. Gross metering was common under the old premium feed-in tariff schemes (where some households locked in rates of 44-60c/kWh), but those schemes are closed to new entrants. If you're installing solar today, you'll be on net metering.

The practical implication: self-consumption is where the money is. Using your own solar power saves you the full retail rate (30-45c/kWh depending on your state), while exporting only earns the feed-in tariff (typically 3-8c/kWh). That's why running your dishwasher, washing machine, and pool pump during daylight hours makes such a big difference to your savings.

Darwin has the highest peak sun hours but slightly lower annual output than Brisbane because the wet season brings heavy cloud cover for months. Brisbane's drier climate delivers more consistent year-round production.

Even Hobart and Melbourne, at the bottom of the table, produce enough to offset most of an average household's electricity consumption (about 16-20 kWh/day). Solar works everywhere in Australia. The difference between the best and worst cities is about 25%, not the 50%+ that some people assume.

Solar output varies significantly with the seasons. In summer you get longer days, higher sun angles, and more intense sunlight. In winter the days are shorter, the sun sits lower in the sky, and cloud cover tends to increase.

A rough rule of thumb: winter output is about 40-60% of summer output, depending on your location. A 6.6kW system in Sydney might produce 35 kWh on a clear January day but only 15 kWh on a June day. This is normal and expected. Your system is sized based on annual averages, not winter minimums.

There's a silver lining in winter though. Solar panels are more efficient in cooler temperatures. Silicon cells lose about 0.3-0.4% efficiency for every degree above 25°C. So on a 40°C day in Adelaide, your panels might be running 5-6% below their rated output just from the heat. On a crisp 15°C winter morning with clear skies, they're actually performing above their rated efficiency. The shorter days still mean less total energy, but each hour of winter sunshine is being converted more efficiently.

Several factors determine how much electricity your panels will actually generate. Understanding these helps you evaluate quotes and set realistic expectations.

Roof orientation

North-facing is ideal in Australia because the sun tracks across the northern sky. West-facing panels produce about 12-15% less annually but generate more in the afternoon, which can be valuable if you're on a time-of-use tariff with expensive afternoon peak rates. East-facing panels capture morning sun. A split east-west setup gives you broader daily coverage and can actually increase self-consumption compared to an all-north system, because you're generating across more of the day rather than peaking at midday.

Roof pitch (tilt angle)

The ideal panel tilt roughly equals your latitude. For most of Australia that's 25-35 degrees, which conveniently matches typical roof pitches. Flat roofs (common on commercial buildings) need tilt frames to angle the panels. Steeper roofs produce slightly more in winter and slightly less in summer. The difference between a 20-degree and 30-degree tilt is usually less than 5% annually, so don't stress about it too much.

Shading

This is the big one. Even partial shading on one or two panels can significantly reduce output, especially with string inverters where one shaded panel drags down the entire string. Trees, chimneys, neighbouring buildings, antennas, and even bird droppings can cause shading issues. A good installer will do a shading analysis during your site assessment. If shading is unavoidable, microinverters or optimisers can minimise the impact.

Temperature

Solar panels have a temperature coefficient, typically around -0.3% to -0.4% per degree Celsius above 25°C. On a 45°C rooftop in Western Sydney during summer, that 20-degree gap means your panels are producing about 6-8% less than their rated output. This is normal and already factored into the output estimates in the table above. Good airflow under your panels (which proper mounting provides) helps keep temperatures down.

Panel quality and age

Tier 1 panels from reputable manufacturers (LONGi, Jinko, Trina, Canadian Solar, JA Solar) degrade at about 0.3-0.5% per year. After 25 years, they're still producing 80-87% of their original output. Cheaper panels from unknown brands can degrade much faster and may not honour their warranty claims. This is one area where paying a bit more upfront pays off over the system's lifetime.

The right system size depends on your electricity usage, roof space, and budget. Here's a rough guide based on household size and daily consumption.

A small household (1-2 people) using 10-15 kWh/day typically suits a 3-5kW system. A medium household (2-3 people) using 15-25 kWh/day is well served by a 6.6kW system, which is the most popular size in Australia. Larger households (4+ people) using 25-35 kWh/day should consider 8-10kW. And if you have a pool, ducted air conditioning, or an electric vehicle, you might want 10-13kW.

The general advice in 2026 is to go as big as your roof and budget allow. Panel prices have dropped so much that the marginal cost of adding extra capacity is small, and the extra production means more self-consumption and more export credits. A system that's slightly oversized for your current needs also gives you headroom if you add a battery, EV, or heat pump later.

One technical limit to be aware of: most Australian DNSPs (distribution network service providers) cap the inverter size for single-phase homes at 5kW. That's the inverter, not the panels. You can put 6.6kW of panels on a 5kW inverter (this is called oversizing) and it's completely normal and approved. The panels rarely all produce at peak output simultaneously, so the 5kW inverter handles a 6.6kW array comfortably. Three-phase homes can go up to 15kW without special approval in most areas.

A home battery stores excess solar energy produced during the day so you can use it at night. Without a battery, your evening and overnight electricity comes from the grid. With a battery, you can cover some or all of that usage with stored solar.

The economics of batteries have improved significantly. The federal Cheaper Home Batteries program provides a minimum 30% discount, and several states offer additional rebates on top. A 10kWh battery that would have cost $14,000 installed in 2023 might now cost $7,000-$9,000 after all rebates.

Whether a battery makes financial sense depends on your specific situation. If you're paying 35c/kWh for grid electricity and only receiving 5c/kWh for exports, every kWh you store and use yourself saves you 30c. A 10kWh battery cycling once per day saves roughly $1,100 per year. At $8,000 installed after rebates, that's a 7-year payback, which is reasonable given batteries are warrantied for 10 years.

If blackout protection matters to you, that's an additional consideration that pure financial analysis doesn't capture. Some households simply want the peace of mind of knowing the lights stay on when the grid goes down.

Every modern inverter comes with monitoring, usually through a phone app or web portal. Fronius has SolarWeb, Sungrow has iSolarCloud, Enphase has their Enlighten app, and Goodwe has their SEMS portal. These show you real-time production, daily/monthly/yearly totals, and consumption data if you have a consumption meter installed.

Monitoring is worth checking regularly in the first few months to understand your system's patterns. You'll quickly learn what a good day looks like versus a cloudy day. After that, a weekly glance is enough to spot any issues. A sudden drop in production could indicate a fault, shading from new tree growth, or even a dirty panel that needs cleaning.

If you have microinverters, the monitoring is panel-level, meaning you can see exactly what each individual panel is producing. This makes diagnosing issues much easier. With a string inverter, you only see the total output of each string, so identifying a single underperforming panel is harder.

Solar installation in Australia is regulated, which is a good thing. It means there are minimum standards for equipment and installation quality.

SAA accreditation

Your installer must be accredited by Solar Accreditation Australia (SAA) for your installation to be eligible for the STC rebate. This isn't optional. SAA accreditation means the installer has completed specific solar training and design certification, and agrees to follow industry guidelines. The SAA scheme replaced the old CEC accreditation program. Always verify your installer's SAA accreditation before signing anything.

Approved equipment

Both your panels and inverter must be on the Clean Energy Council's approved equipment list. This list ensures products meet Australian safety and performance standards. All reputable brands are on it. If an installer offers you a panel brand you've never heard of, check the approved list before proceeding.

Electrical safety

Solar installation involves working with electricity on your roof, so it must be done by a licensed electrician (in addition to having SAA accreditation). Your local council may also require a building permit depending on your state and the system size. Your installer handles all of this as part of the installation process.

Network approval

Before your system can be connected to the grid and start exporting, your DNSP (the company that owns the poles and wires in your area) needs to approve the connection. Your installer submits this application on your behalf. In most cases, systems under 5kW (inverter size) on single-phase are automatically approved. Larger systems may require a network study, which can add a few weeks to the process.