Solar inverters may be classified into three broad types:

1. Stand-alone inverters, used in isolated systems where the inverter draws its DC energy from batteries charged by photovoltaic arrays. Many stand-alone inverters also incorporate integral battery chargers to replenish the battery from an AC source, when available. Normally these do not interface in any way with the utility grid, and as such, are not required to have anti-islanding protection.

1. Grid-tie inverters, which match phase with a utility-supplied sine wave. Grid-tie inverters are designed to shut down automatically upon loss of utility supply, for safety reasons. They do not provide backup power during utility outages.

1. Battery backup inverters^{[clarification needed]}, are special inverters which are designed to draw energy from a battery, manage the battery charge via an onboard charger, and export excess energy to the utility grid. These inverters are capable of supplying AC energy to selected loads during a utility outage, and are required to have anti-islanding protection.

Maximum power point tracking

Solar inverters use maximum power point tracking (MPPT) to get the maximum possible power from the PV array. Solar cells have a complex relationship between solar irradiation, temperature and total resistance that produces a non-linear output efficiency known as the I-V curve. It is the purpose of the MPPT system to sample the output of the cells and determine a resistance (load) to obtain maximum power for any given environmental conditions

The fill factor, more commonly known by its abbreviation FF, is a parameter which, in conjunction with the open circuit voltage (V_oc) and short circuit current (I_sc) of the panel, determines the maximum power from a solar cell. Fill factor is defined as the ratio of the maximum power from the solar cell to the product of V_oc and I_sc

There are three main types of MPPT algorithms: perturb-and-observe, incremental conductance and constant voltage. The first two methods are often referred to as hill climbing methods; they rely on the curve of power plotted against voltage rising to the left of the maximum power point, and falling on the right.