An inverter converts direct current (DC) from a solar panel into alternating current (AC) that can power household appliances and be fed into the electric grid. There are different types of inverters - string inverters connect multiple solar panels in series, microinverters convert power from individual panels, and central inverters are large units used for large commercial arrays. Inverters use maximum power point tracking technology to optimize power output from solar panels and may include additional functions like battery charging. Grid-tied inverters synchronize with utility power while off-grid inverters operate independently without grid connection.