The Ins and Outs of Solar Interconnection

Solar Interconnection: All The Ins And Outs

• Updated on February 20, 2023 • [rt_reading_time postfix=”minute”] read

Solar energy systems come in a variety of shapes and sizes and a reputable solar provider like Velo Solar can design a system perfectly suited to meet your company’s energy needs and goals. This flexibility is one of the things that makes solar such a great option for businesses.

Whether off-grid or grid-connected, solar power systems can reduce your electricity costs and provide reliable and resilient power for your business. And that brings us to interconnection, or the process of connecting a solar system to the larger electric grid.

What is interconnection and how does it work? We’re glad you asked. Read on for more information on this critical part of the solar installation process.

Table of Contents

To Connect or Not to Connect

Solar photovoltaic (PV) panels generate most of their energy during the middle of the day when the sun is high in the sky. If your business doesn’t use all of the energy as it’s being produced, you have a couple of options.

Most solar systems are grid-connected system, meaning energy you produce but don’t use onsite just goes to the grid. It will then flow to your neighbor, and their neighbor and so on, but in most states this transfer offer very little value to you the producer.

Option 2, if you have battery energy storage as a part of your solar system, you can store that energy to use at a later time – for example, you can use your own power to run operations at night or in the case of an outage.

The process of connecting your solar panels to the grid is called interconnection and it can be a complicated and time consuming process. Fortunately, reputable solar providers like Velo Solar have interconnection specialists who can manage the application and approval process, keeping your project on time and on budget.

solar panels and power grid tower

What is Solar Interconnection?

Interconnection is a key step in the overall solar installation process. Essentially, if you are connecting to the grid, your local utility must approve the design and installation of your solar array before you can start generating your own renewable energy.

Interconnection polices are established by each state’s public utility commission (PUC) and must be followed both by the solar installer, the solar owner and the utility. Policies vary from state to state, so you’ll want to be sure your provider is familiar with the mandates of your PUC.

Further, each local utility has its own processes, procedures, and rules when it comes to how they implement a state’s solar interconnection policies. For example, some utilities won’t allow you to connect a solar PV system if it will generate more electricity than your business typically consumes.

While this might seem like a lot of red tape to navigate, there are good reasons why your utility wants to make sure that every solar installation connecting to its grid meets certain standards.


The interconnection process ensures that your new solar array is safe for the public, your business, and the grid operator. The utility will review your system to make sure it meets established electrical requirements and interconnection standards – in other words, they make sure it’s properly grounded and produces high quality, reliable power at the proper voltage and frequency.

Additionally, the process confirms that every grid-connected solar project is designed to prevent energy from flowing to the grid during an outage. This protects the men and women making repairs to power lines, transformers, and the like; it ensures that no unexpected power is flowing through the system. It also prevents damage to the larger grid when the system restarts.

Grid Capacity

While the concept is the same, commercial solar interconnection tends to be more complicated than the process for residential systems. Residential solar arrays produce considerably less electricity than those powering businesses, which means home-based arrays don’t have as much impact on the grid.

Commercial systems, on the other hand, could be sending considerable amounts of energy to the larger power grid, so the utility needs to make sure that the existing infrastructure can handle the extra load. In some cases, grid equipment or systems may need to be upgraded before a new solar power system can be connected.

Part of the interconnection process is determining if upgrades are needed and who’s responsible for paying for them. Some of those costs may be passed on to the solar owner, but most states have limited what the utility can charge.

Net Metering Credits

In some states, you may be compensated for the energy you send to the grid through a process called net metering. To participate in a net metering program, your utility will replace your existing electric meter with a bi-directional model capable of tracking the amount of electricity flowing from the grid to your facility as well as the amount coming from your solar system to the grid (your existing meter only tracks power coming from the grid). If your power company offers a net metering program, this new meter enables them to track the amount of credit to be applied to your billing statement each month.

solar panels and power grid tower

The Solar Interconnection Process

Your solar contractor will obtain all of the necessary local permits required to build your solar energy system. At the same time, their interconnection specialists will be working on obtaining permission to connect your solar system to the larger electrical grid. There are two steps involved in the process.

The Application

The first step in the the interconnection process is the application; some utilities call this “permission to install.” The installer first submits an application to the utility that includes the electrical plans, equipment specifications, system size, solar energy generation estimates, and the overall system design and layout.

This step can be incredibly complex, especially if the impact of a battery energy storage system must be considered.

The utility may require your provider to make adjustments to the system’s design to ensure the system can be safely connected to the grid. They will also notify the installer if grid upgrades need to be made.

Once approved, your provider can begin the solar installation process.

Permission To Operate

All solar energy systems must obtain permission to operate (PTO) from their local utility company before they can be turned on; this is the second step in the interconnection process. PTO certification requires an inspection of the completed installation to ensure that it meets the specifications and agreed upon design plan.

Your provider will likely submit photos of the installation, documentation showing that the project passed the necessary local inspections, and perhaps other details required by the utility. The utility may send someone to the site of the solar installation, while others may use the documentation provided in the permission to operate application.

On-site visits will typically include inspections of your inverter and other solar equipment, as well as the electrical panel connection. They’ll also confirm that the system is generating the amount of power the application said it would. It’s usually during this inspection that the utility will install the new bi-directional electric meter.

Once you have received PTO approval, you can officially begin using your solar array and generate your own energy.

How Much Does the Solar Interconnection Process Cost?

Interconnection costs vary by location, the size of the solar energy system, the utility, and local public utility commission regulations. As noted earlier, there may also be costs associated with grid upgrades.

solar panels and power grid tower

How Long Will the Interconnection Process Take?

The time it takes to complete the interconnection process for a commercial solar project depends on a number of factors, including the size and location of the system as well as the efficiency of the local utility in processing the application. As noted earlier, commercial systems are more complex and could have a greater impact on the overall grid, and thus require more rigorous evaluation.

A reputable solar contractor like Velo Solar will ensure that the application paperwork is filled out accurately, completely, and in a timely manner. But then, it’s up to the utility.

The process could take two or more months, likely longer if the system includes battery storage or if grid upgrades need to be made. If you’re working with an experienced local solar provider familiar with the utility, they’ll be able to give you a fairly accurate estimate of how long the project should take to get approved.

Interconnection is a Necessary Step

If you want a grid-connected solar energy system, interconnection with the grid is a necessary step. Fortunately, the experts at Velo Solar are well-versed in navigating the process so they can ensure you’re generating your own renewable energy as quickly as possible.