When the grid goes down the panels power the house if there's electricity demand, or the battery if there's not. The reason this doesn't work without the batte

When the grid goes down the panels power the house if there's electricity demand, or the battery if there's not. The reason this doesn't work without the battery is that in any closed circuit, electricity production must equal electricity demand at all times. The grid can aggregate millions of households and then has peaking power plants to adjust electricity production to meet electricity consumption. Residential solar panels have no such mechanism - if it's the middle of a summer day and the only appliance you have plugged in is your computer, then that computer is getting your ~4kW of power and is gonna fry. Add a battery and any excess power instead goes to charge the battery. When the battery is full, the grid is off, the house isn't drawing anything, and the panels are still producing, then the circuitry does some trickery to just disable the panels. (I think the inverters actually feed the power back 180 degrees out-of-phase so it cancels out the other power coming from the panels, but the details are beyond me.) Note that the panels are actually disabled at this point, though - they're effectively producing nothing, not just producing less. That's why this doesn't work without the battery - you can break a circuit entirely to stop power from flowing, but as long as the circuit exists without energy storage, power in must equal power out.