A grid-tied inverter is a device that converts direct current (DC) electricity generated by solar panels into alternating current (AC) electricity, which can be used by household appliances and fed back into the electrical grid. Unlike off-grid systems, which require battery storage, grid-tied systems connect directly to the local utility grid, allowing for the seamless exchange of energy. The 10 kW rating refers to the inverter's maximum output capacity, making it suitable for medium to large residential solar installations.