How a Solar System Works

Posted on 08 May 2026

How a Solar System Works

1. Solar panels generate electricity

Solar panels capture sunlight and convert it into direct current (DC) electricity. This type of electricity is not compatible with most household appliances or the electricity grid, which both operate on alternating current (AC).

2. The inverter converts the power

The DC electricity flows into the solar inverter, which converts it into usable AC electricity for the home.

3. Power is distributed throughout the home

Once converted to AC, the electricity enters the home’s distribution board and supplies power to all connected circuits.

The solar system feeds energy into the home in the same way the grid does, meaning solar energy is always used first when there is demand.

If the home is not using all the energy being generated, and there is no storage available such as a battery or electric vehicle, the excess energy moves to the next stage.

4. Excess energy is exported to the grid

Any unused electricity flows through the utility meter in the meter box and is exported to the grid.

Depending on the energy plan, the homeowner may receive a feed-in credit for this exported energy, which can help offset the cost of electricity imported from the grid later.

5. The system runs continuously

This process repeats continuously whenever the system is generating electricity. As long as the sun is shining and the system is operating, energy flows in real time.

Important Notes:

Self Consumption vs Feed-in Tariffs

Using solar energy directly in the home provides greater savings than exporting it and buying it back later.

To maximise savings, it is best to run high-energy appliances during periods of peak solar production. This is typically between 10am and 4pm, although this varies depending on panel orientation:

• East-facing panels produce more energy in the morning

• North-facing panels produce the highest output around midday

• West-facing panels generate more energy in the afternoon and early evening, especially during daylight saving

Appliances such as dishwashers, washing machines, dryers, and EV chargers should ideally be used during these times to increase the value of your solar system.

Flexible Exports

Flexible Exports automatically adjusts how much solar energy your system can send to the grid in real time. These adjustments are made by SA Power Networks to help maintain grid stability during periods of high solar generation.

When there is excess solar across the network, your system’s export limit may be temporarily reduced. This is done via a live signal sent to your inverter through your internet connection.

Your inverter will automatically:

• Receive an updated export limit, typically anywhere between 0 and 10 kW per phase

• Prioritise powering your home first, as self-consumption is never restricted

• Charge your battery with excess energy if one is installed

• Reduce solar generation only if necessary to stay within the export limit

Your system continues operating normally, it simply adjusts output so that:

Home usage + allowed export = total generation.

Example: Flexible Exports in Action

Scenario 1

Export limit: 5 kW

• Solar system generating: 5 kW

• Home usage: 1 kW

• Battery: full

Result: 4 kW is exported to the grid because it is below the 5 kW export limit.

Scenario 2

Export limit reduced to: 1.5 kW

Your inverter responds automatically:

• Home usage: 1 kW

• Allowed export: 1.5 kW

• Total generation adjusts to: 2.5 kW

Result: The system reduces generation so only 1.5 kW is exported, even if it is a sunny day.

Scenario 3

You turn on the air conditioner

• Home usage increases to: 5 kW

• Export requirement drops to: 0 kW

Result - The inverter ramps back up to the full 5 kW output because:

• All energy is being used inside the home

• Self-consumption is never limited

• Export limits only apply to excess energy sent to the grid

For more detailed information on Flexible Exports, refer to the full article in the knowledge base.