What’s Solar Equipment and How Does it Work? Explore Components, Cost, and Benefits

Solar equipment refers to the multiple components of a solar system that work together to convert sunlight into electricity using the photovoltaic effect. Most people recognize solar panels as the face of a solar system, but panels alone don’t make the entire system work. Multiple components, such as solar inverters, solar mounting structures, and solar accessories, come together to make the entire photovoltaic system functional.

The main solar energy equipment components that make the conversion of solar energy to electricity possible are: 

• Solar panels: They capture and convert solar radiation into direct current (DC) electricity.
• Solar inverters: They convert DC output from the panels into alternating current (AC) for household appliances.
• Solar mounting structures: They’re the strong structures on top of which the solar panels are fixed.
• Bi-directional net meter for on-grid solar systems: This meter records electricity exchange between the solar system and the grid.
• Solar accessories: These include MC4 connectors, AC and DC cables and combiner boxes, conduit trays, lightning arresters, and a lightning rod. While they may sound small, solar accessories are crucial pieces of solar equipment, as they ensure a safe and secure current flow between the various components of the solar system.

A lithium battery bank is a mandatory solar power equipment for hybrid and off-grid solar systems. Lithium batteries are expensive to install, and they also have to be replaced once their life is over. That’s why on-grid solar is the most recommended type of rooftop solar panel system for homes, housing societies, and commercial buildings. Since it does not require batteries to store excess solar energy, it’s cheaper to install and easier to maintain. 

For anyone considering installing solar energy systems for energy independence and bill reduction, understanding these components is crucial because they directly impact the solar system’s performance, cost, and long-term savings.

In this blog, we will explain what solar equipment is, the different components of solar energy equipment, and how they work. We will also discuss the reasons that make on-grid rooftop solar better than off-grid and hybrid solar systems, as well as the cost of installing rooftop solar in India versus the solar savings over 25 years.

TL;DR Summary Box: Which Energy is Used in Solar Equipment? 

Solar equipment makes use of solar renewable energy to generate solar electricity, which can be used to power homes, housing societies, commercial offices, and and industrial facilities. A solar photovoltaic system, in particular, uses light, not heat, from solar radiation to produce electricity. 

Here are the main topics covered in this blog:

What is Solar Equipment?

Solar equipment is the set of multiple components that work together in a solar photovoltaic system to turn sunlight into usable electricity (AC) through the photovoltaic effect. 

The main solar power equipment components include: 

• Solar panels: They are made up of solar photovoltaic cells that absorb sunlight and convert it to DC power.
• Solar inverters: Their primary function is to convert the DC output from the panels into AC for use in home appliances. However, solar inverters also use the MPPT technology to ensure that solar panels generate maximum output throughout the day, even under varying sunlight conditions.
• Solar mounting structures: These mounting stands should be strong enough to withstand cyclonic wind speeds and must be made from corrosion-resistant materials.
• Solar accessories: DC cables and combiner boxes safely carry and store the DC output from the panels. AC cables and combiner boxes safely carry AC power from the inverter to home appliances and the grid. Other solar accessories include MC4 connectors, which ensure all components are properly connected to each other, and a lightning arrester that safeguards sensitive appliances and devices by diverting spiked current to the ground.
• Bi-directional net meter: This meter is used in grid-tied systems to record the electricity units exchanged between the grid and the solar system.
• A lithium battery bank: A battery is a solar PV equipment used in off-grid or hybrid solar systems. When panels produce excess energy during the day, a solar panel charge controller (usually built-in in off-grid and hybrid solar inverters) sends the excess DC to the batteries. The stored battery power is then used at night or whenever needed.

Now, let’s explore all these solar equipment components and their types and roles in detail.

#1. Solar Panels: The Most Visible Solar System Equipment

Solar panels, also known as solar modules, are the components that receive sunlight and use the photovoltaic effect to turn it into DC electricity. Out of the various types, the best solar panels that are used in most rooftop solar systems for housing societies, homes, and commercial complexes are monocrystalline bifacial solar panels with PERC half-cut cells.

The two main kinds of solar panels include:

• Polycrystalline solar panels: These were once the most popular panel types but are now almost obsolete due to their low efficiency, which ranges from 16% to 17%.
• Monocrystalline solar panels: The latest technology monocrystalline solar panels are made of half-cut mono-PERC cells. Their efficiency shoots up to 22.5%. Another high-efficiency solar panel to watch out for is the TOPCon module made of n-type silicon cells. This is a relatively new and emerging technology, with module efficiency ranging from 25% to 26%.

How Does Solar Panel Equipment Work?

Solar panels work using the photovoltaic principle that converts solar energy into direct current. When photons present in sunlight fall on the solar cells present inside the panels, they knock electrons loose. The flow of electrons is known as direct current. 

Let’s understand how this particular solar equipment works to convert sunlight into direct current:

• Step 1 – Solar panels absorb photons: Solar cells in solar panels are made of silicon, which is a semiconductor. When sunlight falls on them, the photons present in sunlight transfer their energy to the electrons inside the silicon.
• Step 2 – Energized electrons begin to move: When electrons absorb the energy of photons, they dislodge from their original position and start to move. The space they leave behind is called a hole, which acts like a positive charge.
• Step 3 – The solar cell’s built-in electric field pushes the electron-hole pair in opposite directions: Every solar cell has a built-in electric field created by joining two types of silicon (p-type and n-type). This field pushes electrons and holes in opposite directions, so they don’t recombine immediately.
• Step 4 – Electrons flow in one direction: The electrons are collected by thin metal lines on the front of the cell and move towards the back contact layer. This creates a unidirectional flow of electrons, known as direct current (DC).

#2. Solar Inverter: The Solar Energy Equipment For DC to AC Conversion

An inverter is a crucial piece of solar energy equipment, as it converts the DC output from the panels into alternating current. Without a solar inverter, a solar system is not a functional model for homes because households receive only AC power, as, unlike DC, alternating current is safer.

The three main types of solar inverters are string inverters, microinverters, and power optimizers. 

• String inverters: These are the most common type of inverter used in rooftop solar systems. All the solar panels in a string send their DC power to one central string inverter, which converts it into AC. They are the most affordable solar inverter type; however, if one panel underperforms, the whole string is affected.
• Microinverters: These are small inverters attached to each solar panel individually. Since each panel operates independently, shading or dust on one panel does not impact the performance of the others. While microinverters are more efficient, they can be up to 90% more expensive than string inverters.
• Power optimizers: These devices are fitted to each panel, but they still send power to a central string inverter. They help each panel work at its best by adjusting voltage and current, which reduces losses from shading or mismatch. However, they’re still costly and complicated to install. 

Out of these types, string solar inverters with MPPT technology are most commonly used in residential and commercial rooftop systems, as they’re up to 90% cheaper than microinverters and are highly efficient when nearby objects do not shade the roof during peak sunshine hours.

How Do Solar Inverters Work?

Solar inverters work by converting the DC input they receive from solar panels into AC. 

Let’s check out the step-by-step working process:

• Step 1 – DC power enters the inverter: Solar panels send direct current (DC) to the inverter through strings. A DC isolator and internal checks make sure the input is safe before conversion begins.
• Step 2 – MPPT finds the best operating point: The inverter measures the panel voltage and current, and adjusts them to ensure the panels operate at their maximum power point (MPPT). This maintains high output even when sunlight or temperature changes occur. 
• Step 3 – DC is converted into smooth AC: Inside the inverter, the incoming DC power is first stabilized, then shaped and filtered to produce smooth AC power, the same type used by home appliances.
• Step 4 – Output is synchronized: For on-grid solar systems, the inverter continuously measures the grid’s voltage and frequency, and sends power into the grid when the panels produce excess current. If the grid goes down, the output stops immediately. For hybrid or off-grid systems, the inverter also manages battery charging and discharging.
• Step 5 – Protection and monitoring run all the time: The inverter monitors over-voltage, over-current, DC leakage, ground faults, and high temperatures, and shuts down if necessary. 

#3. Solar Mounting Structures: The Solar PV Equipment to Mount Solar Panels 

Solar mounting structures are stands that securely attach solar panels while optimizing panel positioning for maximum sunlight exposure. These mounts must be built to withstand significant environmental stresses, including cyclonic wind speeds, snow accumulation, and thermal expansion cycles. Moreover, since solar panels have a lifespan of 25 years or more, an ideal mounting structure should also be able to last that long.

SolarSquare’s Intelligent WindPro Mount 2.0 is one such mounting structure that redefines quality and durability. It’s factory-made with accurate dimensions, strong welds, and tight quality checks. Our IIT-Bombay-approved mounting structures are ideal for securing solar panels on roofs because:

• They can withstand high wind speeds up to 170 kmph.
• They use high-density galvanized iron with an 80-micron hot-dip coating to resist corrosion for years.

#4. Bi-directional Net Meter: The Solar Electric Equipment Mandatory for On-Grid Solar Systems

A bi-directional net meter is one of the most important solar equipment in grid-connected solar systems, as it records the exchange of electricity between the solar system and the utility grid. 

On-grid solar systems do not have lithium batteries to store solar energy. Instead, any excess energy produced by the panels that isn’t consumed in real-time is sent to the utility grid, and the net energy meter/smart meter keeps a record of the exported units. Similarly, at night or when the panels produce fewer units than needed, the required electricity units are imported from the grid. The net meter also records the import. 

The process of unit exchange, as recorded by the net meter, is known as the solar power net metering process. Based on the exchange, you either get credits from your DISCOM or a solar bill. 

• If your system exports more units than it imports: Since you’ve supplied more power, you receive credits from the DISCOM, which are either settled at the end of the month or the financial year, depending on your DISCOM’s rules.
• If your system imports more units than it exports: In this case, your home has consumed grid electricity. The net meter has a record of the extra units consumed, and you pay a solar bill only for those extra units.

#5. Solar Accessories: Solar Equipment Necessary to Connect Other Components

Solar accessories are the small components that are used to connect other components of a solar system together. The most important solar accessories include MC4 connectors, AC and DC cables, AC and DC combiner boxes, conduit trays, and a lightning arrester.

Let’s understand the exact role of all solar accessories in detail:

• MC4 solar connectors: These are industry-standard waterproof solar connectors that create secure, weatherproof connections between solar panels and DC wiring. These locking connectors use a positive-engagement mechanism that prevents accidental disconnection. They’re critical for preventing corrosion in outdoor environments exposed to rain, snow, and UV radiation.
• DC cables: These are specialized photovoltaic wires built to carry direct current safely. They use insulation designed to withstand temperature extremes, UV radiation, and moisture. Proper gauge selection minimizes voltage losses while safely carrying panel output current to inverters or charge controllers.
• AC cables: These are standard electrical wires that carry alternating current from inverters to electrical panels and the grid. 
• DC combiner box: It’s a weatherproof box that gathers the DC power from several panel strings and sends it to the inverter through one or a few thicker DC cables. Most DC combiner boxes also include surge protection and a DC on-off switch
• AC combiner box: It’s a weatherproof box located on the AC side that combines the output from one or more inverters and sends it to the building’s main panel or the grid. 
• Electrical conduit and fittings: These are protective tubes and connectors that safely carry solar wires. They shield cables from water, dust, and sunlight.
• Lightning rod: This is a metal rod fixed at the highest point of the roof. It safely conducts a direct lightning strike to the ground through thick metal strips and an earth pit. It protects the roof and panels from a direct hit, but it does not stop the voltage surge that can travel inside the wires. A lighting arrester, another important solar equipment, is needed for that.
• Lightning arresters/surge protection devices (SPDs): These are small devices installed near the inverter on both the DC and AC sides of the system. They divert sudden high voltage from lightning into the earth before it can damage the inverter and other electronics. They only work well with proper earthing and short, direct ground wires. 

#6. A Lithium Battery Bank: The Solar Power Equipment for Off-Grid and Hybrid Solar Systems

A lithium battery bank is a type of solar power equipment used only in off-grid and hybrid solar systems, rather than on-grid systems. Lithium batteries are expensive and require periodic replacement. That’s the reason why off-grid and hybrid solar systems are so costly. Since on-grid solar systems use the grid to store excess energy, they do not require batteries. 

Let’s check out how lithium batteries are charged in off-grid and hybrid solar systems: 

• Excess solar energy is directed into the solar charge controller: This charge controller is either built into the inverter or used as a separate device. It ensures that the DC being sent to the batteries is in a safe range. Once batteries receive the controller-directed DC during the daytime, they store solar energy. 
• Stored energy is used at night or during a power outage: The inverter converts the battery’s DC power into AC, ensuring the essential load remains operational at night or whenever needed.

How Does Solar Equipment Work to Generate Electricity? Step-by-Step Process

All components of the solar PV equipment work simultaneously to ensure that sunlight is converted into usable electricity, which can be sent to the appliances in a home as well as the grid. 

Let’s check out the complete process of how solar equipment components come together to work as one single solar system in simple steps:

• Step 1 – Solar panels capture sunlight: Solar cells in the panels convert the captured sunlight into direct current (DC). 
• Step 2 – DC cables carry DC power from the panel into the DC combiner box: MC4 connectors and DC cables, located inside the conduit, take DC power from each string to a DC combiner box, where strings are grouped.
• Step 3 – DC from the combiner box is sent to the solar inverter: The string solar inverter converts direct current into alternating current. This AC solar electricity is sent to the main distribution board, where it is distributed to the connected appliances. If microinverters are attached to each panel individually, their outputs are combined in an AC combiner box and then sent to the main distribution board.
• Step 4 – Excess energy, if any, is sent to the grid or stored in batteries: In an on-grid solar system, the bidirectional net meter records the extra energy that flows directly to the grid. In off-grid systems, the extra energy is used to charge the solar batteries. In hybrid systems, if the DISCOM allows net metering, any remaining current after the batteries are fully charged is sent to the grid.
• Step 5 – Protection and earthing run all the time: DC and AC isolators, breakers, and surge protection devices keep the system safe. Proper earthing and a rooftop lightning rod protect against electrical faults and lightning strikes.

Why is it Beneficial to Install On-Grid Rooftop Solar Systems Instead of Off-Grid and Hybrid Systems?

Out of the three kinds of solar systems (on-grid, off-grid, and hybrid), on-grid rooftop solar systems are the cheapest, offer the best ROI, and have the quickest payback period. Installing them at home can reduce your electricity bills by 90% or more, and you’ll also receive financial assistance from the government to go solar.

Let’s check out all the benefits that make on-grid rooftop solar systems better than off-grid and hybrid solar systems:

• They make you eligible for a subsidy: The government offers a central subsidy under the PM Surya Ghar Muft Bijli Yojana only for installing an on-grid rooftop solar system. You will not be eligible for this financial assistance if you install off-grid or ground-mounted solar systems.
• They are the cheapest: Since they do not require batteries and the government offers a subsidy for their installation, on-grid solar systems are the most cost-effective of the three types. As a result, they have the quickest payback period. The investment cost breaks even within 3 to 5 years after the subsidy.
• They reduce electricity bills by 90% or more: When properly sized, an on-grid rooftop solar system can meet all your energy needs. This will significantly reduce your reliance on grid electricity, which is not only expensive but also becomes costlier by 3 to 6% annually. The result of no longer relying on grid power? Your bills shrink by 90%. In many cases, customers get zero bills after they go solar.
• They save tens of lakhs of rupees: With an on-grid rooftop solar system, you’ll no longer pay bills because solar will cover all your energy requirements, and the system will produce free electricity for 25+ years. Result? Massive savings in tens of lakhs of rupees. Without solar, you’ll essentially be spending all the money you can save to pay the hefty bills. 

Let’s give you an estimated cost comparison table where you can check the cost of installing a 5 kW on-grid rooftop solar system in India and the money that the solar system will save for you in its 25-year lifespan: 

*Please note: The 5 kW solar panel price in India with subsidy mentioned above is indicative as of 24th September 2025 for the SolarSquare Blue 6ft variant. The actual solar plate price depends on your DISCOM charges, city, product variant opted for, panel type, inverter type, mounting structure height, type of after-sales service, savings guarantee, roof height, etc. Prices are subject to change. Additionally, when calculating savings, we have considered an annual tariff escalation of 3% and an annual degradation of 1%. The actual final savings from a 5 kW solar system depends on the types of solar panels you’ve installed and their efficiency, intensity of sunlight your rooftop receives, orientation of the panels and tilt angle, the pollution level and weather conditions in your city, the temperature, shadow on the roof, impact of dirt/dust, and how well you maintain your panels after installation.

Want to find out the ideal solar system for your house based on your requirements, and how much that system will initially cost and save for you in its entire lifespan? You can use SolarSquare’s solar savings calculator to get all these estimates for free.

Conclusion

Solar equipment comprises all the components of the solar system that work together to produce electricity and then supply it safely to the home, the grid, and batteries (if included). 

The primary components of a rooftop solar system are solar panels, solar inverters, solar mounting structures, solar accessories, a bi-directional net meter for grid-connected solar systems, and a lithium battery bank and charge controllers for hybrid and off-grid solar systems. 

If you live in an urban area with a reliable grid, you will get the best returns by installing a rooftop on-grid solar system. For any further queries, you can book a free consultation with SolarSquare. 

Calculate your savings

Forecast your savings with solar on your investment on the SolarSquare’s plant

Pin code *

Please enter a valid pincode.

Oh! We haven’t reached your location yet

We are not yet servicable at your location but we will soon!

City

Avg electricity bill

Min. 500 Max ₹10,000

Calculate now

FAQs

Q1. What equipment is needed for solar energy systems?

Ans. The main solar equipment components include solar panels, a solar inverter, solar mounting structures, solar accessories, a bi-directional net meter for grid-tied systems, and a lithium battery bank with a solar charge controller for hybrid and off-grid solar systems.

Q2. What materials are needed for solar panels?

Ans. A solar panel is made of silicon solar cells, covered by tempered glass and sealed with EVA sheets and a backsheet, all held in an aluminium frame. It also has copper/silver busbars to carry current and sealants to keep out moisture.

Q3. How to install solar panels for beginners?

Ans. Fix the mounting frames, mount the panels, run the panel cables in conduit trays to the inverter, and connect the inverter to your main board. For on-grid systems, the DISCOM will fit a bi-directional meter. However, it’s highly recommended not to attempt to install a rooftop on-grid solar system on your own. Solar is a once-in-a-lifetime investment, and a significant amount of technical expertise is required to install it correctly. Always hire a professional installation company, such as SolarSquare, which is empanelled by the DISCOM, to carry out the installation process from start to finish safely.