How solar panels work, explained simply

By the Simple.solar editorial team. Reviewed October 2026. 7-minute read. How we research.

A solar panel has no moving parts, no fuel and nothing to burn. It sits on your roof and quietly turns light into electricity. The idea sounds like magic, but the steps are simple once you see them in order. This guide walks you through each one, from a single beam of sunlight to the lights in your kitchen.

You will also learn the two words that confuse almost everyone, kW and kWh, and how to work out what one panel makes in a day.

What happens when sunlight hits a solar panel?

Sunlight is made of tiny packets of energy called photons. A solar panel is built from many small squares called solar cells, usually made of silicon. Silicon is a material that can hold electrons loosely, and that matters.

Each cell has two thin layers. The makers treat one layer so it has extra electrons and the other so it has room for more. Where the two layers meet, a small electric field forms. Think of it as a one-way slope.

When a photon strikes the cell, it can knock an electron loose. The electric field pushes that free electron in one direction. Metal lines printed on the cell collect these electrons and send them out through wires. A steady flow of electrons is an electric current. That is the whole trick, repeated billions of times per second.

A typical home panel has 54 to 72 full cells (or twice as many half-cut cells) wired together. One cell makes only about half a volt. Linking many of them in a row adds the voltage up to a useful level.

Why do you need an inverter?

Panels make direct current, or DC. DC flows in one direction, like the power from a car battery. Your home runs on alternating current, or AC, which switches direction 60 times a second in North America. Your fridge, TV and outlets all expect AC.

The inverter is the box that converts DC into AC. It is the brain of a solar system. It also tracks the best voltage to pull the most power from the panels as clouds pass and the sun moves. Good inverters convert about 96% to 98% of the DC power into usable AC.

Here is the full path in order:

1. Photons hit the solar cells.
2. Cells release electrons, creating DC power.
3. The inverter changes DC into AC.
4. AC flows into your main electrical panel and powers your home.
5. Any extra power flows out through your meter to the grid, or into a battery if you have one.

At night, or when you use more than the panels make, you pull power from the grid as usual. You never have to flip a switch. It all happens on its own.

String inverters, microinverters and optimizers: what is the difference?

There are three common ways to set up the inverter side of a home system. Each one handles shade and monitoring a little differently.

String inverter

Panels are wired together in a row, called a string, and feed one central inverter, often mounted near your electric panel. This is the simplest and usually the cheapest setup. The catch is that a string works a bit like old holiday lights. If one panel is shaded, it can drag down the output of the whole string.

Microinverters

Each panel gets its own small inverter mounted underneath it. Every panel works on its own, so shade on one panel does not hurt the others. You can also see how each panel is doing in an app. Microinverters cost more up front, but they suit roofs with shade or panels facing several directions.

Power optimizers

This is a middle path. A small device on each panel tunes its output, then sends the power to a central inverter. You get most of the shade benefits and panel-level monitoring, at a price between the other two.

What is the difference between kW and kWh?

These two units trip people up more than anything else in solar. Here is the simple version.

A kilowatt (kW) is a rate. It tells you how fast power is being made or used at one moment. It is like the speed of a car, in miles per hour.

A kilowatt-hour (kWh) is an amount. It tells you how much energy was made or used over time. It is like the miles you actually drove.

If a 1 kW heater runs for one hour, it uses 1 kWh. If it runs for three hours, it uses 3 kWh. Your power bill charges you for kWh, not kW. A typical US home uses about 10,500 kWh a year, according to the EIA, or roughly 875 kWh a month.

Solar systems are sized in kW (the peak rate they can produce) and judged by kWh (how much energy they actually make). A "7 kW system" describes its size. What it saves you depends on the kWh it makes. You can look up more terms in our solar glossary.

How much electricity does one solar panel make per day?

Most new home panels are rated between 400 and 460 watts. That rating is measured in lab conditions, with strong, direct light. Real roofs get less, so you need one more number: peak sun hours.

A peak sun hour is one hour of full-strength sunlight. A sunny day may have 10 hours of daylight, but the weak morning and evening light only adds up to about 4 to 6 "full" hours. NREL publishes these figures for every part of the country. Arizona averages around 6, while Washington State averages closer to 3.5.

The basic formula is:

Panel watts × peak sun hours × 0.8 = watt-hours per day

The 0.8 accounts for real-world losses: heat, dust, wiring and inverter losses. Here is the math for a 420 W panel:

• Sunny place (5.5 sun hours): 420 × 5.5 × 0.8 = 1,848 Wh, or about 1.8 kWh per day.
• Average place (4.5 sun hours): 420 × 4.5 × 0.8 = 1,512 Wh, or about 1.5 kWh per day.
• Cloudier place (3.5 sun hours): 420 × 3.5 × 0.8 = 1,176 Wh, or about 1.2 kWh per day.

Over a year, that one panel in an average location makes about 1.5 × 365 = 550 kWh.

How many panels does a home need?

Now scale it up. Say your home uses 10,500 kWh a year and you live in a place with 4.5 peak sun hours.

1. Each 420 W panel makes about 550 kWh a year.
2. 10,500 ÷ 550 = about 19 panels.
3. 19 × 420 W = 7,980 W, or roughly an 8 kW system.

The same home in a sunnier place with 5.5 sun hours would need about 16 panels, or near 6.7 kW. A good rule of thumb: each 1 kW of panels makes roughly 1,200 to 1,600 kWh a year in most of the US. So a 6 kW system in a sunny state makes about 6 × 1,500 = 9,000 kWh a year.

For a number based on your own bill and ZIP code, try our system size calculator. To see what that output could be worth in dollars, use the savings calculator.

What else affects how much power you get?

• Direction: In the US, south-facing roofs make the most. East and west roofs make about 10% to 20% less.
• Tilt: An angle close to your latitude is ideal, but most roof pitches work fine.
• Shade: Even partial shade from a tree or chimney can cut output a lot, especially with a string inverter.
• Heat: Panels actually lose a little power when hot. A panel on a 95°F day may make about 8% to 10% less than its rating.
• Age: Panels slowly lose output, typically about 0.3% to 0.5% per year for good modern panels.

Want to compare panel options? Read our guide to solar panel types.

Frequently asked questions

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