The Three Types of Solar That Homeowners Need To Know About

Solar power is an excellent option for powering your home or business that's both friendly to the environment and cost-effective. It's certainly more accessible than wind energy or geothermal energy. But, with so many types of solar panel systems available, it can be overwhelming to choose the one for your needs.

What is Solar Power?

Solar power is an excellent option for powering your home or business that's both friendly to the environment and cost-effective. It's certainly more accessible than wind energy or geothermal energy. But, with so many types of solar panel systems available, it can be overwhelming to choose the one for your needs.

You can select from different types of solar systems, including off-grid, grid-tied, and grid-tied with battery backup. It can be a challenging task to figure out which one is the best fit for you. In this article, we'll go over the differences between these solar power systems so you can make an informed decision.

What’s the Difference Between Off Grid and Grid-Tied Systems?

This is an graphic depicting the different types of solar systems.

Off Grid Solar

When you think of an "off-grid solar system," you might be imagining an isolated cabin in the woods. It has no connection to the outside world, and a hermit lives there. That mental image is probably partly accurate. Off-grid solar systems are independent of the grid and rely on the off grid battery power to run a home.

These systems require the installation of a battery bank to store excess energy for use during periods of low sunlight. So while off grid systems are not just for isolation enthusiasts, they certainly cater to that lifestyle. 

Grid-Tied Solar

Grid-tied solar systems are connected to the utility grid. This allows homeowners to sell excess energy back to the grid through net metering. Picture this: you install solar panels and start producing your own electricity. If your system is set up properly, your power bill goes to basically zero (besides connection fees and such).

But wait, now you’re producing too much energy, so your electric company offers you credits for the extra energy. This effectively works like an in-store credit system but for electricity. During the winter months when energy production may be lower, these credits can be utilized to offset the energy deficit. This results in an almost negligible electric bill.

You may be concerned about the producing too much energy part of that story. As explained by the Solar Energy Industries Association, only 20-40% of a system’s output ever goes into the grid. This exported solar electricity serves nearby customers’ loads, so most of the power you produce goes directly to you.

Grid-Tie with Battery Backup Solar

One great thing about a grid-tied system is the option to have a battery backup. These systems are the Van Halen's of the solar world - the best of both worlds.

Grid-tied battery backup systems are connected to the grid, which allow you to take advantage of net metering. However, you also have a back up solar battery. This system uses a grid tie inverter to send your extra energy to the battery backup. It can then be used during power outages, or when the grid goes down.

With a solar energy system, you can eliminate stumbling around in the dark. No more searching for candles and matches that you put in a "safe place" for power outages.

Here’s the bottom line:

The primary difference between these solar systems is how they connect to the power grid. Off-grid systems function separately from the grid, while grid-tied systems rely on it for backup power. Off-grid systems are ideal for remote areas where connecting to the grid is not easy to do. Grid-tied systems are useful in areas where outages happen a lot.

Pros and Cons of Off Grid and Grid-Tied Systems

Off Grid Battery Backup

This is a graphic outlining the details of the pros and cons of off grid solar systems.

One benefit of an Off-Grid Battery Backup system is that it offers complete energy independence from the grid. This is especially important for people who live in remote areas or for people who experience unstable grid connections.

When you have an off-grid system, you don't have to rely on the utility company for power. This means that you have complete control over your energy usage. Additionally, off-grid systems can help reduce your carbon footprint, as they rely solely on renewable energy sources, aka the sun! That being said, these benefits come at a cost.

Off-grid systems are typically more expensive, because they require a larger battery bank and other equipment to function. They also require more maintenance and monitoring. This is because you are in charge of making sure your battery bank is charged and maintained.

Another drawback of off-grid systems is that they may have limited power supply. Unfortunately, that means you may experience power limitations during times of low sunlight or high energy demand. This means that running large appliances or powering amenities isn’t the most feasible.

You may have recently purchased a large hot tub or you have built the woodworking shop you have always wanted. Now you're considering an off grid solar power system to offset the costs of powering them. As fun as that would be, it probably wouldn't be the best choice because of the limitations of these systems.

Grid-Tied Solar Systems

This is a graphic depicting the pros and cons of Grid-tied solar systems.

Grid-tied solar power systems are the most common type of solar power system used today. Looking at Big Dog Solar customers, about 85% have a grid-tied system. They are typically less expensive than off-grid systems since you don't need to buy a battery bank to store energy. They allow homeowners to sell excess power back to the grid through net metering.

One thing to understand about grid-tied systems is that they require some dependence on the grid. This mostly occurs during periods of low sunlight. Additionally, grid-tied solar systems are not available in remote areas without access to the grid.

That being said, they are the most popular system for a reason. These systems allow you to experience the benefits of solar, and the security of the grid.

Grid-Tied with Battery Backup Solar System

This is a graphic depicting the pros and cons of a grid tie with battery backup system.

Grid-Tied Battery Backup systems are connected to the grid, but they also have a battery backup. This means you still have a backup power source when the grid goes down.

This makes them a popular choice for those who experience frequent power outages. That's because they offer a cost-effective solution to energy backup during those situations.

This is a callout text from a customer testimonial.

Mitch Workman, the Director of Marketing at Big Dog Solar, shares: “I have a grid-tied with battery backup system. I chose the battery backup system for the peace of mind that comes with it. I still have power even with outages and storms, and it actually has come in handy.”

The Office of Energy Efficiency and Renewable Energy shares these four main benefits to having a battery backup:

  • Around the clock power
  • Pocketbook protection
  • Better monitoring
  • More energy self-sufficiency

And again, grid-tied systems with battery back up allow you to take advantage of net metering. This can help further offset the cost of your electricity bill.

That being said, nothing is perfect, and they do have some limitations. Grid-tied systems with battery back up still rely on the grid for power, so they cannot offer full self-sufficiency. They have limited battery capacity, so if the outage lasts for a long time, your backup power may run out.

This is an image describing the benefits of solar energy.

Load Shifting

One last benefit with a grid-tied battery backup system is a process called load shifting. Load shifting allows you to use your batteries when the energy from the grid is more expensive. Then, when grid energy is less expensive, the system will switch to using grid energy.

This can help save money on electric bills, and reduce your dependence on the grid. Load shifting can help reduce strain on the electricity grid during times of high demand. This can help to prevent blackouts and other grid failures.

Additionally, if you have a SPAN Smart Electrical Panel installed with your solar system, you can get even more insight into the energy that your home is using. This becomes powerful when combined with the smart tech that powers solar panels.

You can learn more about smart electrical panels here.

Other Factors to Consider When Going Solar

Regardless of the type of solar you choose, there are benefits to choosing any of the options.

  1. Solar can increase your home's value.
  2. You're can become eligible for a 30% tax credit.
  3. With a properly designed system you can save on power bills.

Solar can increase home values

Two studies have been conducted that prove this. The first is a study by Zillow that showed that homes with solar sell for an average of 4.1% more than homes without solar.

The Idaho average home price is $442,142 in 2023. A home in that price range would increase in price by over $18,000!

The Colorado average home price is $545,124 in 2023. A home at that price would have an estimated increase of over $22,000!

If you want to learn about the other check out our article on the financial benefits of solar.

Solar can qualify you for a 30% tax credit

The Solar Investment Tax Credit (ITC) is a credit of 30% of the total cost of your solar system and installation that you can apply towards your taxes after you get your system installed.

It can be used for multiple years, and it can add up to a large amount. If your system cost $20,000, and you have to pay taxes, you could get a credit of $6,000.

That's quite the incentive from Uncle Sam!

You can trade solar payments for your electrical bill

There are a few different purchase options for solar. One of the most popular is financing. When you finance a system, it will usually be around the same price or less than your electrical bill.

With a properly designed system that produces 100% of your power needs, this means that you get rid of your electrical bill, and swap it for solar payments. Unlike an electrical bill, solar payments won't go up on you.

And once they're paid off, you're done with them. You can learn more about it on our solar finances article.

Making a good decision about solar

Our goal is to give home and business owners the information they need to make a good decision about solar.

We want you to feel confident about which system type you choose, understanding the financials, and picking a good company to go with.

We maintain long relationships with our clients, and back our work with warranties. If we recommend solar to someone who isn't a good fit for it, we'll end up losing money and time.

It's in our best interest to help you make a good decision about solar. If you want to know how well your home might be suited, we made a quick solar score assessment that you can take to find out if it's a good idea or not!

Check it out below! 👇

Find your solar score in 5 minutes.

You may be more well suited than you think. Get your solar readiness score.


Continue Reading

Explore Solar Options

Residential Solar

Are you a homeowner considering installing solar panels for home energy efficiency?
Grid Tie Solar Systems
Grid Tie Solar w/ Batteries

Commercial Solar

Commercial solar power has the potential to save businesses and building owners more money each year.
Explore Commercial Solar

Agricultural Solar

Farms and agricultural properties are perfect for saving money and adding revenue streams with solar power.
Agricultural Solar Solutions