Solar panels use sunlight to produce direct electricity (DC). To be able to use solar electricity, in both on-grid and off-grid solar panel installations, we need to convert direct current (DC) to alternating current (AC); solar inverters are used to make this DC-AC conversion, thus transform solar electricity in a usable form.
Conventional, Central (string) inverters
In a solar panel installation with a conventional, central inverter, solar panels are connected in series to form an array, which may be considered as a large PV panel, with a nominal rating, say, of about 300-600 VDC. The solar panels array is connected to a single central inverter in order to convert the generated solar electricity to alternating current (AC). The usual voltage power for North America is 120-180VAC at 60Hz whereas for Europe is 220-240VAC at 50Hz.
String inverter pros and cons
With a central (string) inverter arrangement, solar panels are connected in a series (string connection) with a big disadvantage being that the overall system performance is defined by the performance of the system’s bottleneck. That is, the maximum output performance of the string is defined by the minimum (poorest) performing solar panel – see solar panel efficiency. This is a main disadvantage as solar panel installations may face several sources of performance reduction. For example, if a solar panel has a manufacturing defect reducing its performance level, in string connection with a central inverter, it will affect negatively the performance of the whole string, even if the other solar panels are performing to their maximum power output. The same applies in situations of partial shading onto a solar panel, from debris, or snow, or bird droppings etc., affecting the output of the whole string connection. That is why solar panel cleaning is of ultimate importance, especially if central inverters are used. This is extremely important since solar panels have dramatically lower outputs when shaded. Reduced performance in solar electricity generation results in reduced earnings for on-grid installations, especially with FIT’s, leading to longer payback periods and poor financial performance of a solar panel investment. From conducted research it has been found that a shade of as little as 9% on the solar panel surface in a module can lead to power reduction of the whole system as much as 54%. 
Another disadvantage of string inverters is that they normally come at a limited selection of power ratings; this means that the power rating of the solar panels has to be matched to the power rating of the string inverter. For example, an array of 20 solar panels with a total power of 4900 Wp will need an inverter rated at 4900W+, say 5000W or 5300 W. This leads to system unutilised inverter capacity that you actually pay for but you never use. In addition, it places limitations on the option of expansion of the solar panel system. For example, in order to add more panels one need to consider keeping the match between the power rating of solar panels and the central inverter used.
Some additional disadvantages of string inverters include their increased need for cooling and their need of large diameter wire to handle the low voltage of DC in a string connection. Due to larger powr ratings, central inverters have integrated cooling fans making them more bulky and noisy.
So why should anyone undergo the disadvantages of string inverters if there is not benefit? The main reason for anyone using a string inverter is leveraged cost. Provided a system’s power rating is optimised between solar panels and inverter, string inverters may have the cost advantage. The other main issue is location and size of the solar photovoltaic system. When dealing with large scale photovoltaic power plants, especially in rural areas with no surrounding buildings, string inverters are a preferable solution. In PV power plants, using a number of central (string) inverters, in a modular structure, is preferable than using micro-inverters.
Indeed micro-inverters have brought about a new concept in solar photovoltaic system design, with manufacturers claiming an output performance increase of around 5-20%. This improved system performance can have significant financial benefits in solar PV systems.
Since their development, micro inverters have brought about alternative design solutions on solar photovoltaic arrays, introducing new competition to established manufacturers of the conventional central (string) inverters. A good example is Enphase micro inverters that have forced established invert manufacturers, such as SMA, to introduce their own micro-inverter in order to maintain their position in the market. Following the establishment of both micro and central (string) inverters as alternative solutions to solar photovoltaic systems, a number of inverter companies have launched their own solutions in both products. The answer to the question of which inverter is best, micro inverter or central inverter, primarily depends on parameters which are custom specific to each case of a solar photovoltaic system.
Unlike central (string) inverters which are used to connect on an array of many solar panels, micro-inverters, as their name ‘micro’ suggests, are designed to connect on to a single or a pair of solar panels – dual micro-inverters. Their power rating is designed for the output of a single panel, e.g. 245w, or between 400w-500w fro duel micro-inverters.
Micro-inverter pros and cons
Micro-inverters’ smaller power rating also results in smaller size than of central inverters which has several technical advantages. For example, micro-inverters are less prone to failure from heat as they do not have the same need for cooling as, bigger, central inverters do.
Apart from these technical improvements, the main advantage of micro-inverters, compared to central inverters, is that they manage to isolate each solar panel, or pair of 2 solar panels, from the whole system without affecting the overall performance of the photovoltaic system. For example, in a solar panel installation with 20 solar panels and a total power of 4900w, if one of the solar panels is shaded from snow, or bird droppings or other debris, the reduction in the performance of the affected solar panel will not influence the performance of the other panels, thus will isolate the ‘damage’ to a single panel. Considering manufacturing defects in solar panels and performance factors such as, shading, temperature issues etc., manufacturers claim that an array of solar panels with micro-inverters can produce as much as 5% to 25% more than the equivalent array with a string inverter, depending on custom specific circumstances.
Furthermore, Micro-inverters, unlike central (string) inverters are very flexible offering many system expansion options without significant limitations. Because they tend to become an integrated part of the solar panel itself, or of two panels in dual-inverters, they offer the option of adding as many solar panels with a micro-inverter to an existing system as one wants. In addition, extended panels are not limited to have the same power rating of existing panels.
Another main advantage of micro-inverters is their ability to produce grid-matching power at the level of a single solar panel. Each solar panel has its own micro-inverter; solar panel arrays are connected in a parallel connection configuration and then connected to the power grid. The parallel structure with micro-inverters, opposed to string connections with central string-inverters, has the crucial advantages of isolating each panel, thus isolating problems of low performance from the entire system. The sources for such problems may include shading on panels, malfunction of the solar panel or the micro-inverters themselves etc. Considering that micro-inverters operate at lower power levels than central (string) inverters, they offer additional advantages such as lower heat-loads, improved Mean Time Between Failures (MTBF), smaller diameter connection cables which all conclude to better reliability the overall system.
The main disadvantage of micro-inverters has, up until recently, been their increased initial cost. Because a system with micro-inverters requires one micro-inverter for every panel (or every two panels in cases of dual-micro-inverters) the overall cost is marginally higher than that of a system with central, string-inverters. However, with the introduction of dual micro-inverters and technological advancement in manufacturing integrated micro-inverters in solar panels the cost difference is continually reducing.
So the answer to the question of which inverter is best; micro-invert or string inverter is rather dependable on custom specific circumstances. If you are dealing with a small system such as residential solar panels perhaps it would be justifiable to undergo the extra initial cost of micro-inverters in order to avoid evident risks of underperformance. In residential areas the chances of underperformance, either from shading or from technical faults, are usually high. On the other hand, if you have a roof higher than any other building, with low chances of shading on your solar panels and in an open area with cooling breezes, the cheaper option of string inverters might be a better solution.
Once again, the best type of inverter is a matter of custom specific circumstance of your solar photovoltaic system; size, location, temperature, risk of shading and of course, financial constraints! If you are interested in installing solar panels for your home you may be faced with choosing the best solution for your solar photovoltaic system. Learn more on how to estimate the true cost of solar panels in how much solar panels cost.