This is one of the most common misconceptions about PV, and one that has often misguided many consumers into unnecessarily spending more money on higher powered panels they do not really need.
Indeed a PV system consisting of higher powered panels does NOT necessarily provide an overall better value compared with a system consisting of less powerful panels. More often than not, the opposite is true!
Firstly, it is worth noting that under current regulations, the maximum permissible power output of a PV system allowed on a single phase is limited to 3.68 kW AC. This means that no matter how many solar panels one would wish to install on single phase, the combined OUTPUT power of the inverter SHALL NOT exceed 3.68 kW.
Moreover, another regulation states that the maximum size of a PV system connected to an inverter should not be more than 20% larger than inverter’s rated AC output. Therefore if a single phase inverter’s power is limited to 3.68 kW (AC), the maximum DC power of solar panels cannot exceed 4.416 kWp (DC).
For the sake of an example, this maximum power can be approached by having either 11 solar panels rated at 400Wp (DC) each (4.4 kWp), or 8 panels 505Wp each (4.04 kWp).
Although higher-powered solar panels tend to take up less space, they also tend to be more expensive than solar panels with lower power rating.
At the end, whether one uses 400Wp panels or 505Wp panels, the power output of the equivalent PV system would still be the same!