Homeowner’s Guide to the Federal Tax Credit for Solar Photovoltaics
Solar panels may seem complicated—we'll make it simple.
Don’t worry—we’re not here to overwhelm you with the nitty-gritty details. But if you want to go a bit deeper into the process of how solar panels create electricity, we’ll explain what you should know.
Key takeaways
Solar cells are typically made from a material called silicon, which generate electricity through a process known as the photovoltaic effect.
Solar inverters convert DC electricity into AC electricity, the electrical current appliances run on when plugged into a standard wall socket.
Other types of solar technology include solar hot water and concentrated solar power. They both use the sun’s energy but work differently than traditional solar panels.
To start, what exactly is solar energy?
This process is constant: Over 500 million tons of hydrogen atoms are converted into helium every second, resulting in photons that generate solar energy here on Earth.
How solar panels work: The photovoltaic effect explained
In a nutshell, solar panels generate electricity when photons (those particles of sunlight we discussed before) strike solar cells. The process is called the photovolatic effect. First discovered in 1839 by Edmond Becquerel, the photovoltaic effect is characteristic of certain materials (known as semiconductors) that allows them to generate an electrical current when exposed to sunlight.
About 95% of solar cells are made from the element silicon, a nonmetal semiconductor that can absorb and convert sunlight into electricity through the photovoltaic effect. Here’s how it works:
There are two layers of silicon in solar cells. Each one is specially treated, or “doped,” with phosphorus and boron to create positive and negative sides of the solar cell, respectively. When photons hit the solar cells they create an electric field at the junction between the layers.
This electric field knocks electrons loose from the atoms in solar cells, setting them in motion.
The electrons flow through the solar cell and out of the junction, generating an electrical current.
Metal plates on each side of the solar cells capture the electrical current and transfer it to connecting wires.
The electrical current flows through the wires to a solar inverter (or multiple inverters), which converts it to usable electricity for your home—more on this part below.
What are solar panels made of?
A typical solar module includes a few essential parts:
Solar cells: We’ve talked about these a lot already, but solar cells absorb sunlight. When it comes to silicon solar cells, there are generally two different types: monocrystalline and polycrystalline. Monocrystalline cells include a single silicon crystal, while polycrystalline cells contain fragments of silicon. Monocrystalline cells provide more room for electrons compared to polycrystalline cells, resulting in higher efficiency (and more expensive) solar panels.
Glass casing: Provides durability and protection for solar cells.
Insulation layer and back sheet: These are under the glass exterior and protect against heat dissipation and humidity inside the panel, which can result in lower solar panel performance.
Anti-reflective coating: Increases sunlight absorption and gives the cells maximum sunlight exposure.
12V wire: Regulates the amount of electricity transferred to your inverter.
Bus wire: Connects silicon solar cells and carries the electrical current.
How do solar panels generate electricity for your home? Step-by-step explanation
Generating an electric current is the first step of a solar panel working, but the process doesn’t end there. Here’s how solar arrays create a usable electricity system for your home:
Your home can’t use DC electricity directly—it needs to be converted to alternating current (AC) electricity first. Most household appliances use AC electricity, which can reverse direction and flow back and forth.
This is where inverters come into play, converting the DC electricity from your solar panels to usable AC electricity. You could have one central inverter on the side of your house, or microinverters on the back of each panel.
Solar inverters transfer the converted AC energy to your home’s electrical panel. From there, electricity is dispersed through your house to all of your outlets so that when your devices need to be plugged in, there is a usable electric current available.
What types of solar technology exist?
But other types of solar technology exist—the two most common are solar hot water and concentrated solar power.
Solar hot water
In a solar hot water system, there’s no movement of electrons, and no creation of electricity. Instead, the solar panels, known as “collectors,” transform solar energy into heat. Sunlight passes through a collector’s glass covering, striking a component called an absorber plate, which has a coating designed to capture solar energy and convert it to heat. The heat is transferred to a “transfer fluid” (either antifreeze or potable water) contained in small pipes in the plate.
Concentrated solar power
Concentrated solar power (CSP) works in a similar way to solar hot water in that it transforms sunlight into heat—but it doesn’t stop there. CSP technology concentrates the solar thermal energy using mirrors and turns it into electricity. At a CSP installation, mirrors reflect the sun to a focal point. At this focal point is an absorber or receiver that collects and stores heat energy, which drives a heat engine (typically a steam turbine), generating electricity.
CSP is most often used in utility-scale installations to help provide power to the electric grid. It’s an alternative to fossil fuel-based power plants.
