When you install any kind of home energy system there are a lot of small parts that make up the whole.
The reality of these systems is that, as electricity travels from solar panels, through wires and inverters and into batteries, some of the energy gets lost. That's because no system has 100% energy efficiency. But what is electrical efficiency, and why does it matter?
Experts say understanding the efficiency of any electrical equipment you're installing in your home is key to getting the most out of your investment. Here's what you need to know.
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Electrical efficiency is essentially a ratio, according to Jacquelyn Omotalade, climate investments national director at Dream.org, a climate justice organization.
The efficiency of any technology is a measurement of how much useful electrical output you get compared to a given electrical input, Omotalade says. Think of it in terms of solar panels on a sunny day: In a highly efficient system, you'll get a lot of electricity out of that solar input; in an inefficient system, you'll get a smaller fraction of the sun's power.
Efficiency extends beyond the panels themselves. Everything in your home that carries electricity, from the solar inverter to the wiring in your walls, has an efficiency rating, and power might be lost if your system is inefficient.
But where does that "lost" power actually go? "It's not used, and it just goes away," Omotalade said. Energy might be lost for several reasons, like wasted heat or natural resistance within the system.
So now you know what electrical efficiency is, but why should you care?
Well, if you're going to invest tens of thousands of dollars in a highly efficient solar panel system you want to make sure your home can match that. If the panels are connected to an inefficient inverter or battery or home wiring, you'll lose some of the power your panels are generating.
Understanding efficiency can also help you size your system correctly. More efficient solar panels mean you'll need fewer panels to generate the desired amount of power, compared to less efficient panels. Efficiency also impacts cost, and higher efficiency products can be more expensive.
Omotalade says that electrical efficiency is also a matter of climate justice. In many urban and minority communities, older homes have lower electrical efficiency, meaning residents will get less out of investments like solar panels.
You might be wondering: What numbers should I actually be looking for here? It depends on the technology, but as a general rule of thumb: The higher the electrical efficiency, the better.
Let's break it down.
A good efficiency rating for solar panels is between 19% and 22%, according to Becca Jones-Albertus, director of the Solar Energy Technologies Office in the US Department of Energy.
"The most efficient solar panels on the market can convert more than 22% of sunlight into electricity," Jones-Albertus said in an email.
Most people would want a higher-efficiency solar panel that can convert more sunlight, but you can get away with a lower efficiency if you have more roof space for more panels. "For example, a 6,000-watt PV system utilizing solar panels that are 22% efficient will take up less physical space than a 6,000-watt PV system utilizing solar panels that are 19% efficient, but both will be rated to produce the same amount of power," Jones-Albertus said.
It's also important to note that efficiency will decline as your solar panels age. Jones-Albertus says the best panels will retain about 90% of their original efficiency rating by the end of the warranty period, which is usually 25 to 40 years.
And of course, temperature can affect efficiency, too. While you want sunny days to generate electricity, extreme heat can diminish power output from the panels by as much as 16% in average panels, according to Jones-Albertus.
The numbers here are quite different. When you're looking at battery efficiency ratings, aim for something with about 85% efficiency, Jones-Albertus says. Newer batteries can eclipse 90% efficiency.
Remember that efficiency is a ratio, so with home batteries, the efficiency measures how much energy goes into the battery versus how much you can pull out.
Just like solar panels, battery efficiency is not static. The age of the battery, the temperature of where it's stored and the number of charge discharge cycles it's completed can all affect that efficiency number during use.
"As with all types of batteries, efficiency and energy storage capacity will degrade over the useful life of the battery system," Jones-Albertus said.
Here's where you're looking for the highest efficiency numbers. Solar inverters are a key piece of equipment that takes the energy coming in from solar panels and makes it usable as electricity in your house.
Jones-Albertus recommends seeking out solar inverters with efficiencies in the 96 to 97% range -- meaning there will be virtually no power loss as the energy flows from your solar panels into your home. The most efficient inverters can reach 99% efficiency.
Solar inverter efficiency determines how well an inverter converts the DC electricity created by solar panels to AC electricity that can be used in our homes and by the grid. Inverters are an integral part of any solar installation. Without them, our installations would actually be useless, since we couldn’t use the electricity they produced.
No inverter is 100% efficient, as there will always be at least some loss of energy during the conversion process. However, inverters today enjoy very high efficiency, converting between 95% to 98% of all the DC electricity generated into AC, with manufacturers always reaching for that next step in performance.
Is solar inverter efficiency really that important? Is it worth spending a couple extra bucks for the most efficient solar inverter you can find? Let’s take a look at inverter efficiency to answer these questions and more!
Let’s start off by naming the most efficient inverter we are aware of. As of September 2017, this distinction goes to SMA’s Sunny Boy inverter for larger residential installations (9kW to 11kW). These inverters see an incredibly high 98% efficiency (CEC rating, explained below), or 98.7% max rating.
Almost 99% efficiency? That’s pretty incredible. If you checked out that link above about performance, you know that this sort of efficiency is what inverter manufacturers were dreaming about just 2 years ago! These companies are willing to spend lots of time and money for only a 0.1% increase in efficiency, so SMA’s 98.7% efficiency is a pretty big breakthrough.
Of course, these larger inverters are only an option if your installation is around 9kW to 11kW in size – equal to about 34 to 42 average solar panels. If you have, like most of us, a much smaller solar installation (the average size is 5.6kW, according to research from the National Renewable Energy Lab, p.5), you’ll need a smaller inverter to match. SMA’s smaller offerings see a still-respectable, but lower, 96% to 97% efficiency.
SolarEdge’s inverters see an incredible 99% efficiency – higher than any other manufacturer – but come with a catch. The inverters must be coupled with the company’s module-level power optimizers — which see an efficiency of 98.8% — dropping the total efficiency of the entire inverter/optimizer system down to 97.8% efficient (which is actually still really, really good!) See below for details and links to product spec sheets.
In 2016, the National Renewable Energy Lab gathered stats (p.7) on the most commonly installed inverter manufacturers. The data only covers California, but other states likely see similar results.
Let’s take a look at moderate-sized inverters from each of these manufacturers to get an idea of common efficiency ratings. All efficiencies below are the CEC rating, a standardized testing protocol for inverter efficiency developed by the Sandia National Lab and adopted by the California Energy Commission.
You can see that, among the most popular inverter manufacturers, efficiency hovers between 96% to 98%.
Compare these to smaller, cheaper inverters you hook up to your automobile or camper that see between 80% and 90% efficiency. They’re much less efficient and produce lower quality electricity that can’t support delicate electrical gadgets (pure sine vs modified sine) but are designed to be economical and for occasional use only.
Inverter efficiency directly affects your installation’s total energy production. All electricity your installation creates flows through the inverter. If your inverter is 80% efficient, you immediately lose 20% of all the electricity you created. If your inverter is 98% efficient, you lose only 2% of your electricity. It pays to pay attention to your inverter’s specs!
Over many years, that small inefficiency can add up. Let’s say your solar installation puts out 7,000 kilowatt-hours of electricity each year. After 25 years, it’ll have produced 175,000 kWh. Let’s see how much electricity you’d lose with different inverter efficiencies.
To make it more interesting, let’s turn this production into a monetary amount and say that each kWh is worth $0.13, the national average electricity price as of 2017. Let’s also say that those prices rise 2.6% each year – also the average yearly increase in the US.
At this rate, for our example:
Obviously, 100% efficient inverters don’t exist and you’d never install an 80% efficient inverter on a solar installation – both of those are there to provide greater context.
You can see that the difference between the 98% efficient inverter and 96% efficient inverter is only about $600 in losses – or $24 each year over those 25 years. While it’s still a loss of $600, it’s really not a huge amount when you consider how long it took to get there.
You want to squeeze out as much financial savings over the life of your solar installation as possible, so you need to make sure you’re not spending a premium on an ultra-efficient inverter that’ll never recoup its higher price. That more efficient inverter might produce an extra $600 of electricity, but if you spend an extra $1000 for it, does it really make sense?
Of course, there are other factors to consider when choosing an inverter (warranty, brand, etc), but if you’re spending an extra $2k on a premium inverter that is 2% more efficient, it might not be worth it.
To decide if a higher efficiency inverter is right for you, just walk through the steps above. Compare how much your solar installation would produce with your 2 different options and turn the kilowatt-hours produced by each into a monetary amount (check your utility bill for your own electricity cost). It never hurts to ask your installer for advice as well!
Efficiency isn’t the only important consideration when purchasing an inverter. Here are a few others.
We’ve already mentioned this one, but we’ll put it here just to be thorough. You need to make sure that the power gains you see from increased efficiency are greater than the additional cost of the inverter.
Solar salespeople rarely bring this up, but most inverters call it kaput after 12 to 15 years. It’ll likely be the first (and only) major solar component that you’ll need to replace. It might be worth a couple extra bucks to buy an inverter with a longer warranty, since inverters cost anywhere from $1,500 for a small system to thousands of dollars for a larger one.
Microinverter manufacturer Enphase warranties their products for a full 25 years – longer than any other manufacturer. While their microinverters see a lower efficiency and higher cost than others on this list, you can come out ahead financially when installing these, since you won’t have to purchase a replacement inverter down the road. Certainly keep things like this in mind when choosing an inverter!
Here’s the warranty length from the brands above:
You don’t want to buy the biggest inverter you can afford. You want to buy the inverter that fits the size of your installation – i.e. the number of solar panels installed. For example, if you have 30 panels each rated at 265 watts, you need an inverter that can handle an output of 7,950 watts (probably an inverter rated around 8kW). Any more than this is just money down the drain.
Since all the electricity your installation produces flows through the inverter, the efficiency of your inverter is, of course, an important consideration when choosing your equipment. You want to squeeze as much electricity (and financial savings) from your installation as possible and your inverter’s efficiency is certainly part of that.
Don’t forget, though, that you need to balance that efficiency with cost and other important inverter components – the warranty and installation size. In some cases, it might even make more financial sense to go with a lower efficiency inverter that has an extended warranty so you can avoid purchasing an entirely new inverter 15 years down the line. As always, do your homework and make sure your inverter is right for you before signing the dotted line!
What factors are most important to you when deciding on an inverter? Let us know in the comments!
Image Credits under CC License via Flickr – 1, 2, 3, 4 & Pixabay – 5
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