` Solar Energy Facts: Cost of Solar Panels? How Does Solar Work?

Solar Energy Facts

How Solar Panels Work

Photovoltaic (PV) solar panels work by generating electricity from the sun’s rays, converting this energy into AC current used by common household or business appliances and lighting.

Watch how a solar installation generates energy from the sun.

Glossary of Solar Terms

  • Alternating Current (AC) – A type of electrical current used in lighting, appliances, and in the outlets in your home or office. Solar systems need to convert DC into AC to connect to your electrical systems and the grid.
  • Array – a system of connected solar panels, usually mounted on a roof or on the ground.
  • Direct Current (DC) – A type of electrical current run by electronics and small appliances. This type of current is generated by batteries or through a transformer. DC is the type of current produced by solar systems.
  • Grid – The grid connects utility companies to their customers using power lines. Homeowners with solar systems usually remain connected to the grid to use energy at night and sell excess energy during the day.
  • Inverter – A component of a solar system that turns DC power into AC power for use in the home/office or return to the grid.
  • Kilowatt (kW) – This is a unit of electrical power. It is equal to 1000 watts. Solar systems are measured by how many kWs they can generate.
  • Kilowatt-hour (kWh) – This is the standard unit for measuring energy usage. One kWh is equal to 1kw (or 1000 watts) used over the course of one hour. For electric bills the rate is normally a few cents per kWh.
  • Net Metering – This is an agreement between you and your utility company that allows you to sell excess electricity to the grid. This can offset your energy used at nighttime or on cloudy days, reducing or even eliminating your energy bill. Many customers love watching their utility meter run backwards as they send energy to the grid!
  • Photovoltaic – The process of converting sunlight into electricity. Often abbreviated as PV.
  • Solar Renewable Energy Certificate – Also known as SREC, REC, or ZREC (for Zero Emissions Renewable Energy Credit), these credits are a way for homeowners to be paid by utility companies based on their output. One SREC is the equivalent of 1000 kWh of electricity. Rules, rates, and availability are state-specific.

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