Off-grid vs. grid-tied solar. Ground mount vs. roof mount. Polycrystalline panels vs monocrystalline.
If you want to learn more, please visit our website.
When it comes to installing a solar power system, there are a lot of decisions to make. And because you’re investing in equipment that will last many years, you want to make the right choices.
If you partner with a reputable solar installer, they’ll be able to guide you through these decisions to get you the perfect system for your situation. However, doing a little homework on the front end can’t hurt either. That’s why we’re sharing the four differences between on-grid and off-grid solar power to help you decide which is best for your solar project.
We’ll cover:
What Is Off-Grid and On-Grid Solar Energy?
An off-grid solar energy system is not connected to the utility grid, whereas an on-grid (aka grid-tied) solar energy system is connected to the utility grid. Whether off-grid or on-grid system will determine your access to electricity, what equipment is needed for excess production, what happens when the grid goes down, and how you’re billed for electricity.
*System components simplified for graphic
The Differences Between Off-Grid and On-Grid Solar Energy
Difference #1: Your Access to Electricity
Electricity Access with Off-Grid Solar
What is meant by off-grid solar systems? With an off-grid solar system, you’re completely reliant on the sun and energy stored in batteries to power your home or business.
If you opt for a solar system that is not tied to the electric grid and you do not have a generator, you will only have electricity at two points:
When the sun is shining and your solar system is producing electricity.
When you’re pulling electricity previously generated by your solar system from a solar storage device, like batteries.
If you do not have batteries or a means to store your energy, you will have less or no electricity when it’s cloudy, and you will not have electricity at night.
With an off-grid system, you will not have access to extra electricity if you need it. What you are producing and what you have stored is all that’s there to power your equipment.
Electricity Access with On-Grid Solar
If you decide to install an on-grid solar system, you will always have access to electricity (unless the grid goes down), whether or not your solar system is producing or if you have batteries.
If your system is not producing any electricity or not producing enough electricity to power the devices, lights, machines, etc. that you’re using, you can pull energy from the utility grid to supplement it. This ensures you always have enough electricity for what you need.
Difference #2: What Happens to Excess Production
Excess Production with Off-Grid Solar
Depending on the size of the system you install, how much electricity you use, and when you use that electricity, there will likely be times when your system is producing more electricity than you’re using. What happens to this excess energy depends on the equipment you install.
Most off-grid solar systems are designed to produce a certain amount of “extra” electricity in the daytime, which is sent to batteries for storage. The energy stored in those batteries can then be accessed when the system is not producing, like at night or during cloudy weather.
Depending on your energy goals, systems can be sized to produce enough excess electricity in the daytime to cover your entire energy usage around the clock.
However, despite even the best and most accurate estimates, the weather is unpredictable. If you experience abnormally cloudy weather several days in a row, your system may not be able to produce enough electricity to charge the batteries and fulfill all your needs.
While having extra batteries offers peace of mind and can provide a bank of stored electricity just in case this happens, they’re also expensive. Purchasing more batteries than you need may be cost-prohibitive, depending on your budget.
Excess Production with On-Grid Solar
Just like off-grid solar systems, many who choose to install an on-grid solar system want to cover 100% or nearly 100% of their energy usage. This can be achieved with on-grid systems as well.
Depending on the time of day you use electricity, your solar system can produce excess energy. Instead of sending it to batteries as you would in an off-grid system, you can send it to the grid and you will be compensated for that electricity.
For many in the United States, they’ll be compensated through something called net metering. Net metering is when the utility company compensates or credits your account for electricity generated by your solar system and sent to the grid. Then, whenever you need to draw energy off the grid, you’ll be drawing on those credits to get your electricity without racking up charges on your electricity bill.
There are currently mandatory net metering rules for 39 states. 11 states are either transitioning or are currently implementing compensation methods other than net metering (like the Value Stack in New York).
Map from www.eenews.net via https://www.dsireusa.org/
Grid-connected solar power has a distinct advantage over off-grid systems because net metering and other compensation methods from utility companies offer what is essentially free storage.
Difference #3: What Happens When the Grid Goes Down
Power Outages with Off-Grid Systems
Your solar system is working independently from the power grid. If there’s a bad storm or event that knocks out the power, your solar system can continue operating. You won’t notice changes in your service or access to electricity.
Power Outages with Grid-Tied Systems
By connecting to the grid, you get access to electricity whenever you need it. However, you’re also subject to some rules. If you have a grid-tied solar system and the grid goes down, you will not have electricity, unless you opt for a grid-tied solar system with battery backup.
Why is this? The shutdown of solar systems when the grid goes down is required by the Underwriters Laboratories (UL 1741). This is for the safety of utility workers who are fixing the power lines.
While this is a disadvantage of grid-tied systems over off-grid systems, if keeping things up and running during a power outage is important to you, then you may be interested in adding batteries to your grid-tied system.
Difference #4: How You’re Billed for Electricity
Electricity Bills with an Off-Grid System
OMMO are exported all over the world and different industries with quality first. Our belief is to provide our customers with more and better high value-added products. Let's create a better future together.
If your PV system is not tied to a grid, you won’t receive an electric bill at all. However, even with no electric bill, off-grid systems are often more expensive because of the additional equipment like batteries that are needed to make it viable.
Electricity Bills with a Grid-Tied System
If you opt for a grid-tied system, you could still see a few minimal charges on your electricity bill, even if your solar system provides 100% of your electricity.
One type of charge you may continue to see is the service fee or delivery charge. This is the cost levied on customers for connecting their home or business to the grid. For many utilities, this fee is a flat rate that is not impacted by how much electricity you use.
Another type of charge you can see is demand charges. Demand charges are typically levied on commercial properties and are the increased electric rate you pay for the power you use during a peak demand period. The peak demand period is typically the 15-minute period in which your business uses the most electricity.
Because using a large amount of electricity at one time puts a strain on the grid, the utility will charge a higher rate for the electricity used during that period.
If your peak demand period is during the day, you may be able to reduce it with solar, as energy produced by your system will compensate for some of the energy you use from the grid. If you pay very high demand charges, you may also want to look into peak demand shaving with solar and batteries.
Depending on how much energy your solar system produces and how much energy your home or business uses, you may see an electric charge for the electricity you pulled off the grid and used that wasn’t covered by your net metering credit.
Hybrid Solar Energy Systems
A hybrid solar energy system is one that is tied to the grid but also has a battery bank to store unused electricity. Hybrid systems, though more expensive due to the added cost of batteries, allow their owners to keep the lights on when the grid goes down, and can even help reduce demand charges for businesses.
If you’re interested in learning more about a hybrid solar energy system, check out our blog: How to Size Batteries for a Solar System.
There are two ways for grid-tied solar systems to be connected to batteries: DC Coupling and AC Coupling.While there are distinct differences between off-grid and grid-tied solar systems, the one that is best for you is dependent on your situation. Off-grid systems allow for complete freedom from the utility, but they’re often more expensive. Grid-tied systems marry significant electricity savings with grid-backed dependence, so you’ll never have to worry about not having the electricity needed to power your house or business.
Learn more about the advantages and disadvantages of both options in our blog Grid-Tied Solar vs. Off-Grid Solar: What are the pros and cons of both?
If you feel the cost of electricity has risen recently, you're not imagining it.
As more stuff in our homes uses electricity, it's getting more expensive. According to inflation data published by the US Bureau of Labor Statistics, the cost of electricity rose 3.8 % in the 12 months ending in January 2024. That's much below the number a year ago, when it rose nearly 12 %.
With energy prices always climbing, you might be tempted to take your home off grid and cut ties with your utility completely. The proliferation of rooftop solar panels might make it seem in reach, but it's not as simple as it sounds.
Can solar panels save you money?
Interested in understanding the impact solar can have on your home? Enter some basic information below, and we’ll instantly provide a free estimate of your energy savings.
CNET contributor Eric Mack knows all too well what it takes to move completely off the gird and achieve 100% energy independence. "Living off the grid means committing to sourcing everything you need to survive and thrive independently: food, shelter, water, energy. It's empowering, until the moment things don't work," Mack wrote in his first-person account about living off the grid.
Although this transition requires significant upfront costs, you could save money in the long run. Here's what to know if you're thinking about buying a solar panel system and disconnecting from the power grid.
What is an off-grid solar system?
An off-grid solar system is a self-contained energy system that independently produces and stores electricity.
Off-grid systems function by using solar panels, often mounted on the rooftop, to absorb energy radiated from the sun and convert it to direct current electricity before transferring it to a battery for storage. An inverter converts the energy stored in the battery to alternating current electricity to power your home.
Considering Solar Panels?
Our email course will walk you through how to go solar
There are four main components of every off-grid solar system:
- The solar panels and mounts that hold the panels in place.
- The charge controller, which regulates energy flow from the solar panels to the batteries.
- The battery, which stores the energy accumulated from the solar panels.
- The inverter, which converts the DC electricity stored in the battery to AC electricity that runs appliances.
As inflation continues to erode the dollar's value, more people have embraced cost-effective sustainability practices. These off-grid solar system solutions offer the dual benefit of positively affecting the environment and increasing energy independence.
Considering Solar Panels?
Our email course will walk you through how to go solar
Can you still be connected to the grid and have solar panels?
Grid-tied systems are not independent, standalone entities. Instead, they are connected to the utility grid and transmit excess energy generated by the solar panels back to the electric grid -- often selling it back, through a process called net metering, for credits on your power bill. The primary advantage of grid-tied systems is they are significantly cheaper because the owners do not need to buy expensive batteries to add to the system.
Off-grid vs. grid-tied solar systems: Which is better?
When it comes to off-grid vs. grid-tied solar systems, there is no easy answer, said Rohit Kalyanpur, CEO of Optivolt, a Silicon Valley-based solar technology company. It all depends on your preferences and needs.
For example, If you live in a remote area and don't have reliable access to the electricity grid, then an off-grid solar system would work better, said Kalyanpur.
Both grid-tied and off-grid solar systems are eligible for a 30% federal tax credit on the total cost of the system. In order for batteries to qualify for the credit, they'll have to have a capacity of at least 3 kilowatt-hours.
Off-grid solar systems
Benefit You can achieve energy independence and self-sufficiency
Drawback Has a higher upfront cost because it requires batteries and other additional equipment.
Good for If you live in a remote area that is not connected to the electric grid.
Bad for If you use equipment that consumes a lot of electricity or cannot afford the high upfront costs.
Grid-tied solar systems
Benefit You can reduce your electric bill and receive compensation for any excess electricity fed into the utility grid.
Drawback It relies on the utility grid as a backup system. When there are power outages, people without a battery backup still lose power.
Good for If you have a connection to the grid and want to reduce your electricity bill.
Bad for If you live in a remote area or area prone to frequent power outages. It's also not ideal for those who want to achieve energy independence.
Types of off-grid solar systems
Each off-grid solar system installed at a location must be customized to meet the unique energy needs of the people at that location, Kalyanpur said. However, three main types of off-grid solar systems cater to the energy needs of most people.
Solar-only systems
These systems rely exclusively on solar panels for power generation. The excess energy generated from the solar panels is stored in batteries and used when the panels don't generate enough power to run the home -- such as at night or when it's cloudy. The cost of these systems depends on factors such as the number of solar panels, battery capacity and efficiency, and the types of inverters and charge controllers.
Solar system with generator backup
These systems combine solar panels with a backup generator. The solar system generates electricity during the day, and the backup generator kicks in during periods of low sunlight or at night. These backup generators are usually powered by diesel, gasoline or natural gas. The cost of backup generators varies, so it's essential to research and understand the costs associated with fueling the generator on a monthly basis before making a decision.
Hybrid solar systems
These systems use solar panels and other alternative renewable energy sources like wind turbines or hydroelectric power to create a diversified and reliable power system. Like solar-only systems, hybrid systems work in conjunction with external batteries.
How much do off-grid solar systems cost?
Off-grid solar energy systems are a great alternative that helps families meet their energy needs and save money on their utility bills. But solar panels aren't cheap, and neither is the installation work required to get a system in operation. The typical solar panel system in the US costs around $30,000 before the federal tax credit.
Off-grid systems will typically be even more costly. For example, high-capacity, high-efficiency solar batteries are typically very expensive and cost another $10,000 to $20,000. In some cases, they may be more expensive than solar panels.
Correction, Aug. 18: This story originally presented some statements as direct quotations that were actually paraphrases of what the individual cited had said. Those passages have now been rendered appropriately as paraphrases.
For more information, please visit Off Grid Power Solutions.