A grid-tie inverter (GTI), technically called “grid-interactive inverter” is a type of inverter that converts direct current(DC) electricity into alternating current(AC) electricity and feeds it into an existing electrical grid. They are normally used to convert direct current produced by many renewable energy sources, such as solar panels or small wind turbines, into the alternating current used to power homes and businesses. They may also be called synchronous inverters. Grid-interactive inverters typically cannot be used in standalone applications where utility power is not available.

Inverters take DC power, and change it to AC power to be fed into the electric utility company grid. The Grid Tie Inverter must synchronize its frequency with that of the grid (e.g. 50 or 60 Hz) using a local oscillator and limit the voltage to no higher than the grid voltage. Typical modern GTIs have a fixed unity power factor, which means its output voltage and current are perfectly lined up, and its phase angle is within 1 degree of the AC power grid. The inverter has an on board computer which will sense the current AC grid waveform, and output a voltage to correspond with the grid.

There are variety of Grid-tie inverters that are available on the market with number of different technologies. The inverters of new technology are high-frequency transformers, conventional low-frequency transformers, or even use no transformer. These high-frequency transformers employ a computerized multi-step process that involves converting the power to high-frequency AC and then back to DC and then to the final AC output voltage, it do not  convert DC current directly to 120 or 240 volts AC, Transformerless inverters are lighter in weight and have high efficiencies than their counterparts with transformers, are popular in Europe. However, transformerless inverters have been slow to enter the US market.