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Solar power is fast gaining popularity in Australia and has become more accessible and affordable in recent years, with many homeowners and businesses choosing to install a grid-connected solar power system. This article will discuss the basics of a grid connect solar power system, including how they work, the components involved, and the benefits they offer.

What is a Grid Connect Solar Power System and How Does it Work?

A grid connect solar power system is a system that has a connection to the local power grid which is usually powered by coal or in some cases gas. The system comprises solar panels that generate electricity from the sun, a solar inverter that converts the DC electricity produced by the panels into AC electricity that can be used in homes or businesses, and a bi-directional power meter that measures the energy flow from and to the power grid.

When sunlight falls on the solar panels, they produce DC electricity, which is then sent to the inverter. The inverter converts this DC electricity to AC electricity, which is used to power appliances in the home or business. Any excess electricity generated by the solar panels that is not used immediately is sent back to the grid and the system owner can be credited for supplying this excess power for other customers connected to the same grid to consume.

SMA Sunny Boy grid connect solar inverter
How Grid Connect Solar Power Works

What is a Grid-Connected Solar Inverter?

Grid Connect solar systems require a type of solar inverter called a grid tie inverter, which is specifically designed to synchronise with the electrical grid. These inverters convert the DC voltage produced by your solar panels into 240V AC electricity that is compatible with the grid. The resulting electricity from a grid tie inverter is virtually identical to that of the grid, and in many cases, it may even be of higher quality.

A grid tie inverter generates AC electricity in a sinewave pattern that precisely matches the voltage and frequency of the electrical grid. However, it's important to note that the voltage and frequency of the grid can fluctuate significantly on a daily basis. Consequently, the grid tie inverter must constantly monitor the voltage and frequency of the grid and make adjustments to its output to synchronize with the grid's waveform at any given moment. By doing so, the inverter can effectively supply electricity back into the grid that corresponds exactly to the electricity provided by the utility companies.

Inverters come in different sizes and types, depending on the size of the solar panel system and the specific needs of the home or business. Some inverters are designed to work with battery storage systems called Hybrid Solar Systems, allowing excess electricity generated during the day to be stored in a battery for later use.

All grid tied inverters available for purchase will come with an Ingress Protection (IP) rating that indicates the level of sealing the inverter has and where it can be installed. The IP rating is represented by numbers such as IP21, IP42, or IP65, which correspond to indoor use only, outdoor installation with covering and enclosure, and outdoor installation without cover, respectively. For optimal performance and longevity of the inverter, it's recommended to install it in a cool garage. Conversely, installing the solar inverter in direct sunlight is not recommended as it can significantly decrease the inverter's lifespan and efficiency due to high temperatures.

What is a Bi-Directional Power Meter?

A bi-directional power meter is a device that measures the flow of electricity between the power grid and a grid-connected solar power system. The meter measures the amount of electricity that is used from the grid and the amount of electricity that is fed back into the grid from the solar panels.

A bi-directional power meter is necessary because it allows electricity retailers to determine how much electricity a grid-connected solar power system is exporting back to the grid. This information is used to determine the amount of credit a solar system owner can receive through the solar feed-in tariff.

What is the Solar Feed-in Tariff?

The solar feed-in tariff is a payment made to the owner of a grid-connected solar power system for any excess electricity generated by the system that is fed back into the power grid. The payment is made by electricity retailers and is designed to encourage the uptake of renewable energy sources such as solar power.

The rate of the solar feed-in tariff varies depending on the state or territory in Australia and the specific electricity retailer. Some electricity retailers offer a flat rate for all solar system owners, while others offer a higher rate for solar systems that meet certain criteria, such as being installed before a specific date.

Australia's "solar rebate," which provides a discount on the purchase of a new solar power system, is frequently mistaken for feed-in tariffs. This subsidy, which is still in effect and can amount to thousands of dollars, is a distinct incentive from feed-in tariffs.

Choosing a Good Electricity Plan to Go with Your Grid Connect Solar Power System

A suitable electricity plan for those who use solar power should have a combination of high feed-in-tariffs, low usage tariffs, and low daily charges. Opting for a simple and fixed tariff is generally more advantageous for solar owners.

For individuals who own solar panels along with a battery, the best plan is often one that uses time-of-use tariffs with lower rates during off-peak and shoulder times. If enough solar power is generated and stored, it can help avoid the costly peak rates associated with these plans. Virtual Power Plants are also an option for battery owners and can be compared here: Virtual Power Plant Comparison.

The comparison tool below is hosted on the website and allows users to compare current plans from all electricity retailers available in their postcode. It presents the information in an easy-to-read list format with brief summaries and links for more detailed information on each offer.

Up to date information of state by state feed-in tariffs and rates can be found on the SolarQuotes website at the links below:

Here are some good questions to ask your electricity supplier:

  • What is the amount they will compensate you for the electricity you export, measured in cents per kWh?
  • What is the rate you will be charged for the electricity you purchase from them, measured in cents per kWh? Will you lose your discounted off-peak rates if you go solar?
  • Will you be subject to a higher fixed daily charge if you install solar?
  • What is the method of payment for the energy you produce? Will you receive cash or a credit on your electricity statement?
  • Are there any fees for termination or administration that you need to know of?
  • Will you need to upgrade your metering system to avail of the feed-in tariff, and are there any expenses associated with it?
  • How often will the surplus energy be calculated (instantaneous, daily, or quarterly)?

How Much Does a Grid Connect Solar Power System Cost?

The cost of installing any solar power system can vary greatly depending on location, system size, roof type and ease of access. The figures in the table below are from the SolarQuotes website. Last Updated: 6th Feb 2023.

System Size Number of Panels Price Range
1.5kW 4 $2,500 - $4,000
2kW 5 $3,000 - $4,500
3kW 8 $3,500 - $5,000
4kW 10 $4,000 - $6,000
5kW 13 $4,500 - $8,000
5.4kW 14 $4,700 - $8,500
6kW 16 $5,000 - $9,000
6.6kW 18 $5,500 - $9,000
7kW 19 $6,500 - $10,000
8kW 21 $7,500 - $11,000
10kW 27 $8,000 - $13,000
15kW 40 $13,000 - $18,000
20kW 54 $17,000 - $22,000
- Source:

Grid-connected solar power systems are an excellent way to reduce electricity bills, generate clean energy and contribute to a more sustainable future. By understanding the basic components of a grid-connected solar power system, including solar panels, inverters, bi-directional power meters, and solar feed-in tariffs, Australians can make informed decisions about whether to install a solar system and how to get the most out of it.

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