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When sunlight shines on to solar panels (which are composed of photovolatic (PV) cells), the light is transformed into DC electricity. That DC electricity is then converted to the AC electricity that is used throughout your home.
During the day, if the PV system generates more electricity than is used in your home, that extra electricity is fed into the utility grid and is credited on your electric bill. When this happens, you will actually be able to see your utility meter spin backwards. At night, electricity is automatically drawn from the grid, as it is now, to provide your home with the power you need. 
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