How do solar panels work? [Ultimate Guide]

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Solar technology is becoming an increasingly popular option for homeowners and businesses to save money on their monthly utility bills. However, many people don’t know how solar panels work or their actual benefits.

This blog post will answer these questions and give you a better understanding of how solar panels operate so that you can get the most out of solar energy.

What is solar energy?

Solar energy is a form of renewable energy and is created from the sun’s rays and heat. We can use energy from the sun in various ways, such as solar farms, rooftop panels, and solar thermal systems. 

Solar energy has been around for a long time. But, it has become much more popular in recent years due to its cost-effectiveness and ability to offer a more reliable energy source.

Types of solar energy

What is photovoltaic solar power (Solar PV)?

Photovoltaic solar panels generate electricity by utilizing the movement of electrons in photons to produce an electric current. It’s an efficient way to convert sunlight into electricity without any by-products which are harmful to the environment. In addition, PV provides renewable energy that doesn’t rely on fuel to run 24/7.

Solar PV is commonly found on the rooftop of homes and is an excellent choice for those looking to reduce their carbon footprint. This type of solar panel can also increase the value of your property if you’re interested in selling at some point down the road.

Solar PV systems consist of solar panels, a solar inverter, and a battery bank. The solar panels capture sunlight and direct it to the inverter that converts it into grid-compatible electricity. The battery bank then stores this energy for later use.

What is concentrated solar power (CSP)?

Concentrated solar power systems deal with the use of solar energy to generate electricity. This is achieved by using mirrors or lenses to concentrate a large area of sunlight, or solar radiation, onto a small area called a receiver.

The first type of these systems uses reflectors to reflect sunlight onto one central tower (much like the traditional solar cooker), while others use many smaller mirrors (heliostats) to direct the light on different parts of the same central tower.

The second type uses lenses or curved mirrors. It tracks the sun in two dimensions to continue pointing towards a central tower.

How do solar panels work?

Solar panels generate electricity from sunlight when photons are absorbed into the photovoltaic cells within the solar panels. This causes electrons to move about and create an electric current, known as the photovoltaic effect.

The movement of these electrons across layers of silicon will produce direct current, DC electricity. The solar inverter will change the current from DC to AC electricity to be used in your home.

How do photovoltaic cells produce electricity?

Photovoltaic cells, also known as solar cells, are arranged in rows on the surface of solar panels, with a glass layer on top and a protective back sheet on the rear. Each photovoltaic cell is made of several layers of materials.

The semiconductor layer comprises a positive layer, called the p-type, and a negative one called the n-type. The n-type layer is kept thin to allow the sunlight light to hit the pn junction, which is between the p-type and n-type silicon. This will create an electric field to form, which enables electrons to flow through a circuit, and the solar cell will produce DC electricity.

However, PV cells aren’t 100% efficient since they will always lose some energy to convert the sun’s light into electricity.

The amount of solar energy that a solar panel produces is directly related to the total surface area of the cells. On average, each square meter (or about 10.76 square feet) can produce an average of about 120-200 watts in full sun conditions. This energy output will reduce when you consider any shade or obstructions affecting the sunlight’s reach or other weather conditions.

Solar cells are typically placed facing south and tilted at an angle between 30-degrees and 45-degrees to the ground to reach optimum efficiency. This allows for maximum sunlight exposure throughout the year since the sun’s position changes with time of day, time of year, and latitude.

A single solar panel is pretty weak on its own, so most systems will include several panels connected to produce the desired amount of energy.

When there’s no or minimal sunlight, the output from the solar panels slows down significantly or stops altogether. This depends on cloud cover and how much direct sunlight hits your home solar system.

What are the three types of solar panels?

There three different types of solar technology are:


The monocrystalline cell is made of a single piece of high-purity (or high-grade) silicon crystal cut from a round ingot – much like how gemstones are cut. This type of panel is more efficient at converting the sun’s rays into electricity than other types, but also more expensive.


The polycrystalline solar panel is less efficient than the monocrystalline. However, it’s also more affordable. The silicon comes from multiple crystals submerged in an energy solution during production, which causes the crystals to grow larger and become fewer in number. The cells are usually rectangular and measure between 14-17% efficient at converting sunlight into electricity.

Thin Film

The thin-film solar panel is made by applying a semiconductor material to a flexible substrate using a vacuum chamber under low pressure. The resulting product is lighter and less fragile than wafer cells. This is ideal for solar installations where crystalline panels would struggle on curved surfaces. 

Thin-film panels have a lower cost per watt-hour compared to other types of solar panels. Still, their efficiency rates are also typically lower.

What are the benefits of solar panels?

Solar has incredible benefits to offer the world, but if you aren’t convinced, head over to our blog – 8 Reasons to go solar.

Do some states get more solar energy than others?

Yes, some states get more solar energy than others due to the amount of sunshine they receive. States closer to the equator tend to have more intense sunlight than states at higher latitudes for most of the year.

How does weather affect solar energy?

The amount of solar energy that hits the Earth’s surface varies depending on weather conditions. In general, areas that receive more sunlight have a greater potential for solar installations. However, cloud coverage and air pollution can also decrease the amount of energy captured from sunlight. Sometimes, there is even snow cover which means less sunlight can hit the solar cells.

How does the grid connection work with solar panels?

Grid-connected solar panels are connected to the electric utility grid. They feed electricity back to the power grid when they produce more than consumed and draw power from the grid when production falls below consumption. This process is known as ‘net metering.’

Solar net metering involves you, the solar system owner, having a contract with your utility company. The agreement will contain the net metering terms and conditions, and in most cases, they will purchase electricity at the retail rate for any excess energy your solar system produces. 

Suppose your system isn’t producing enough power to meet your needs. In that case, they will sell electricity to you, also at the retail rate.

What happens to excess energy?

If the solar system produces more energy than consumed, the excess electricity will go back to the grid. The utility company buys it at retail rates, and you will receive a credit on your utility bill.

Homes solar systems with battery storage follow a different process. The excess electricity generated by your solar system is first used to charge the battery until it is full. Then the extra energy is distributed onto the grid.

Do solar panels need batteries?

No, solar panels don’t require battery storage. Most homeowners typically have a net metering agreement with their utility company which allows for power transportation back to the grid.

However, solar battery storage is becoming increasingly popular for homes that want to decrease their reliance on the grid. Therefore, we recommend solar panels combined with battery storage to ensure a continuous renewable energy supply.

Solar battery storage involves installing Lithium-ion batteries to store the excess energy produced by solar panels for later use. By storing solar energy as it is being produced, homeowners can ensure that their home has an electricity supply even during a power outage or at night.

How long do solar panels last?

Solar panels typically last for over 30 years. Most solar companies offer 25-year warranties on their panels.

Like any other electronic equipment, they gradually lose efficiency as they age. The conventional solar panel will decrease by 0.5% in efficiency per year. As a result, your home solar system will require more sunlight to produce the same amount of energy as a new conventional solar system.

You want to generate the maximum amount of solar energy during your solar panel’s lifetime. That is why it is vital to choose a high-quality solar panel.

The SunPower A-Series 420 W boasts of the lowest degradation rate, with the system retaining 92% efficiency over 25 years. External laboratories tested the A-Series and found that it has a useful life of over 40 years.

How much do solar panels cost?

Solar panel prices can vary, depending on the size of your system and where you live. However, it’s essential to understand that expensive solar energy systems do not equate to better quality.

The best way is to compare quotes from different solar companies to ensure you receive the best value for your money.

What solar incentives are there?

There are several solar incentives available that can reduce the cost of your system significantly.

The government offers a nationwide Investment Tax Credit of 26% for solar system installations. In some states, homeowners can also benefit from a Property Tax or Sales Tax exemption on the cost of their solar PV system.

What is the payback period for solar panels?

The payback period for a solar system is the length of time it takes for you to break even on your investment in solar panels for your home. Typically, the payback period is between 5–15 years.

If you have a net metering agreement with your utility company, the savings from your solar panels will begin to accrue as soon as they’re installed.

How do I find the right solar company?

It’s crucial to find the right solar company that will give you great pricing and one that guarantees quality.

Many homeowners are wary of solar companies because they think solar is too expensive or complicated. However, with so many options available today, it has never been easier to switch to solar power for your home.

Don’t be afraid to ask questions when you’re dealing with a solar company. Here are some questions to consider when interviewing a company:

1. How long has the solar company been in business?

2. What kind of warranty do you offer on your panels and installation?

3. What is your average payback period for customers like me?

4. What incentives are available in my location?

5. Are you able to provide references and/or case studies of previous clients?

6. Are financing options available with your company, and what is the process?

Solar Gleam Energy has helped many homeowners like you through the process by providing them with the tools and knowledge needed to make an informed decision. We are also a trusted SunPower dealer, allowing us to offer flexible solar financing.

How do I switch to solar energy?

The first step to going solar is to get a free quote from us by filling out this form or calling us on (609) 225 4101. Then, we’ll match you with one of our energy advisors, who will provide you with a comprehensive quotation for your solar project.

Thanks to advances in technology, the cost of solar panels has decreased significantly over the past few years. This means that homeowners can go solar more affordably.

Summary: How do solar panels work

To summarize, solar panels work by receiving the sun’s energy and converting it from DC electricity into AC electricity – a more usable form for your home.

When solar panels are installed on your roof, the generated electricity can be used to power appliances, lighting systems, or even electric cars.

When you consider all the benefits, there’s no better time than now to switch over to solar power. This is especially true if you have access to net metering or are in a location where federal and state incentives are available.

A properly installed system can save homeowners thousands on their utility bills each year while protecting the environment at the same time.


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Daisy Perez

Daisy Perez

Hi, I'm Daisy. I love solar energy! My job is to help people get the most out of their solar panels, and it's so amazing being able to do that every day.

I also enjoy taking trips to Blackwater Falls State Park in West Virginia for some serenity time – it's a great place for me to recharge my batteries and just relax.

But when I’m not doing those things, you can find me at home with my dogs or cooking up something yummy in the kitchen.

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About Solar Gleam

As a certified SunPower dealer, we’re here to help you learn more about solar, so you make an informed decision before making the switch. We’ve put together our best resources on how solar technology works, the role of solar storage, and the process of going solar for you to go through at your own pace.

Learn more about our company here.

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