Section 5: Finding the right inverter for your system

Choosing an inverter may not be the first thing that comes to mind when you’re thinking about installing a solar or solar plus a battery system.

But every one of the two million solar systems already installed in Australia includes an inverter, which can be thought of as the heart of the system—if it’s not working, your solar generation is wasted.

In a nutshell, an inverter takes electricity from a power source that produces ‘DC’ electricity, such as solar panels or a battery system, and converts it into mains-equivalent 230 volt ‘AC’ electricity ready for use in your house.

AC (alternating current) and DC (direct current) are two different forms of electricity. Mains electricity is AC and powerpoints and light fittings put out AC electricity, but many small household appliances convert it to DC before using it.

Why you need a good inverter

It is important to have a good inverter. In grid-connect systems, an inverter failure means your solar panels are doing nothing until the inverter is repaired or replaced. Still, it’s worth remembering that even the best inverter is unlikely to last as long as the rest of your system. Solar panels should last more than 25 years, but inverters are not generally expected to last much more than 10 or 15. You can expect to replace your inverter at least once over the life of your solar PV system.

Which inverter for your needs?

Grid-interactive inverter

Most currently installed grid-connected solar PV systems use a grid-interactive inverter. A grid-interactive inverter converts the energy from solar panels into mains power and feeds it into the house’s electrical wiring. The panels are connected to the inverter as a series of connected strings with each panel feeding into the one following it, much like fairy lights. If one panel suffers reduced output, such as by shading, it can affect all panels in that string. As indicated by the name grid-interactive, these inverters can export energy into the grid, and require a grid connection (or an equivalent 230 volt AC supply) to operate; if the grid goes down (i.e. a blackout) then they stop operating.


Another type of grid-interactive inverter is the microinverter, which is designed to be mounted on the back of a solar panel to make the panel itself a grid-interactive module. These are ideal for those who want to start small and increase their system over time, or for systems where the array may be partially shaded. In a solar system using microinverters, each panel is independent of the others and not affected if other panels are shaded.

Hybrid inverter

When a system also includes energy storage (batteries) it gets a little more complex, as the inverter needs to deal with charging and discharging the battery in addition to generation (solar panels) and the grid.

Systems with batteries often use a more complex type of inverter called a hybrid inverter, which can feed energy into the grid from either the solar array or the battery bank.

Many hybrid inverters can also power the house from the batteries and solar during a power failure, in effect becoming a large UPS (uninterruptible power supply). They can also charge the batteries from the grid.

This makes many hybrid inverters true bi-directional devices, and many, if not most, can handle all of the energy flows in a home energy system. Some can even divert the excess solar energy to a particular load, such as a water heater, replacing the need for a separate device, known as a solar diverter, for this purpose.

However, hybrid inverters are not essential for solar PV systems with batteries. Batteries can be used with standard grid-interactive inverters or with microinverters, usually by adding an extra inverter, or by using a battery with a built-in inverter. These types of setups, though, don’t necessarily have all the extra features of hybrid inverter-based systems.

Solar Savvy Tip: If you are going to undersize your inverter, the solar array can be no more than 33 per cent higher capacity than the inverter for the STC rebate to be applied, for example, 6.6kW of solar panels on a 5kW inverter.

Sizing your inverter

In systems using a grid-interactive inverter, the inverter is usually sized to match the solar array. For example, if you have a 5kW solar array, then you would install a 5kW inverter. However, inverters can also be undersized or oversized for different reasons.

Undersizing the inverter (usually referred to as overclocking the inverter or oversizing the solar array) might be done because inverters operate more efficiently when operating near capacity, and solar panels spend most of their time generating below their rated maximum. Solar panels have become cheap enough that the small amount of generation lost when they are running at full capacity with an undersized inverter is usually worth less than the additional cost of a larger inverter – especially when you consider the extra energy captured by the improved efficiency when the panels are generating below their rated capacity.

If you are going to undersize your inverter, the solar array can be no more than 33 per cent higher capacity than the inverter for the STC rebate to be applied, for example, 6.6kW of solar panels on a 5kW inverter.
Oversizing the inverter allows for expansion of the solar array at a later time if desired, and also means the inverter is less stressed at times of maximum generation. The difference in price for a slightly larger inverter may be small in many cases. However in practice, few households add to their solar array after it is installed, and if they do they often finds that changes to standards mean they have to replace the inverter anyway. If you are planning to expand your array in the future, speak with your installer about what might be involved.

Sizing an inverter for a hybrid energy system is a more advanced task that really should be left to the installer, with input from you on power output requirements. There are a number of factors that will determine the hybrid inverter’s ratings, including the size and output capability of the battery bank, the loads the inverter must power, and whether it has to be able to run in UPS mode as a backup power supply when the mains grid fails.

Inverter monitoring and connectivity

All inverters have some way for users to monitor their performance and activity. In its simplest form, this might include coloured indicator lights or text-based or graphical displays that show all the parameters of the inverter, including (depending on the inverter type) battery voltage, current and state of charge; solar array voltage and current; 230 V AC output voltage, current and power, including peak power; and various status and mode displays.

Many inverters have network connectivity using Wi-Fi or ethernet and can upload data to web portals for the owner to see – and share if they want to. Many can connect directly or via the web with smartphone apps that give access to stored and real-time data. Being able to monitor your system remotely is far more useful than having to go outside and look at the display from time to time, so consider this when choosing an inverter. The range of parameters that may be reported and recorded can be vast, including those mentioned above as well as energy consumption of the home, energy exported to the grid or diverted to a specific appliance (such as a hot water system), support energy provided by the battery, battery temperature, inverter temperature, ambient temperature, and any errors that may have occurred.

All this information is useful because it can tell you how well your system is working and show if a problem arises. But some of the information is complex and difficult to interpret without the necessary knowledge or experience. Subscribing to a monitoring service – where a specialist business monitors your system performance and alerts you if something goes wrong – could well be worth the additional cost if it saves you from losing your free energy and feed-in-tariff payments for an extended period of time.

As inverters become more advanced and systems become more complex, the need for inverters to talk to other system components, and even control those components, is growing. Some inverters have these capabilities already, making integrating compatible components, such as grid-interactive inverters into an AC coupled hybrid system, much simpler.

Cost of an inverter

Costs vary significantly by size and quality. As inverters are an essential part of a solar PV system, they are usually included as part of the whole package so their price may not be apparent unless you ask your installer. For a good quality 5kW grid-interactive inverter, expect to pay between $1,000 (for a low-cost but dependable one) and $2,000 (for a premium inverter with extra features).

Hybrid inverters, which also have the capacity to operate from batteries and often contain a high capacity battery charger, are more expensive, with 5kW models costing between $2,500 (budget) and $5,000 (premium).

Approvals and certification

All inverters designed for permanent installation must meet the relevant Australian Standards. Grid-interactive and hybrid inverters and inverter-chargers must also have ESAA (Electricity Supply Authority of Australia) approval before they can be connected to the grid, so check for this also.

It is unlikely that you would find any inverters for sale in Australia without these approvals. However, it is easy to buy inverters and other equipment online from almost anywhere, so if you intend to claim a rebate for your system, the inverter will need to meet all approval requirements.

The Clean Energy Council maintains a list of approved inverters that meet Australian Standards for use in the design and installation of solar photovoltaic (PV) systems.

The Solar Homes program requires the installation of inverters that meet Australian Standards and are IEC 62116 Certified (a safety measure) and have Volt-Watt and Volt-Var response ability (to help manage grid stability in areas where lots of solar PV systems are installed). The specifications sheet for your inverter should have this information, or you can ask your installer. Most inverters on the market meet these requirements.