Is Solar Energy Technology Improving?

Solar energy technology has advanced significantly in recent decades. While solar power accounted for only a tiny fraction of global electricity generation just 10-15 years ago, it has now become one of the fastest growing renewable energy sources worldwide. The key factors driving this growth have been substantial improvements in two main areas: solar panel efficiency and cost.

This article examines the major developments that have enabled these improvements in solar technology. It tracks the efficiency gains that have been achieved in both commercial solar panels and in lab settings. It also analyzes the drivers behind the dramatic cost declines that have made solar power increasingly cost-competitive with fossil fuel sources. While challenges remain, the overall trends clearly show that solar technology is progressing rapidly.

History of Solar Panels

The first solar cell was invented in 1883 by Charles Fritts, who used selenium coated with a thin layer of gold to convert light into electricity ( However, the solar cells invented by Fritts were very inefficient with less than 1% efficiency. It wasn’t until the 1950s that solar photovoltaic (PV) technology started to be seriously developed.

In 1954, researchers at Bell Laboratories built the first modern silicon solar cell with 6% efficiency. This breakthrough opened the door for solar cells to be used commercially ( In 1958, solar cells began being used to power orbiting satellites and other spacecraft, which drove advances in manufacturing and efficiency. Through the 1960s and 1970s, solar PV technology continued to advance as manufacturing techniques improved.

In the late 1970s and early 1980s, solar PV started to be used in consumer products and for terrestrial applications. In 1977, the first solar-powered calculator was introduced by Sharp Corporation. And in 1982, ARCO Solar produced the first 1-megawatt commercial PV plant in Hesperia, California.

Solar Cell Efficiency

Solar cell efficiency refers to the percentage of sunlight energy that can be converted into electricity by a solar cell. It measures how much of the solar energy striking the solar panel is converted into usable electricity.

According to Sunrun, “Solar cell efficiency is determined by the material used in manufacturing the solar cell. The most common solar panels on the market today have an efficiency of 15% to 20%.”

Higher efficiency solar cells can generate more electricity from the same amount of sunlight. This means homeowners need fewer panels to meet their energy needs. However, higher efficiency panels are typically more expensive.

Most residential solar panels today use monocrystalline silicon cells with average efficiencies around 20%. Emerging technologies like perovskites and organic cells promise even higher efficiencies in the future.

Overall, solar cell efficiency has improved substantially over the past several decades and continues to be a major focus of research and development. Higher efficiencies allow solar power to become more cost competitive with conventional energy sources.

Efficiency Trends

The efficiency of solar cells in the lab has improved substantially over time. According to research conducted at Stanford University and published on their website, the record solar cell efficiency has increased from around 11% in the 1970s to over 45% in recent years. Another study published on ResearchGate shows a similar trend, with solar cell lab efficiency records rising from under 20% in the 1980s to over 45% in the last decade.

graph showing increasing solar cell efficiency

Much of these efficiency gains have been driven by improvements in semiconductor materials and device architecture that allow solar cells to more effectively absorb sunlight and convert it into usable electricity. Key innovations have included the development of multi-junction solar cells with multiple semiconductor layers to absorb more of the solar spectrum, as well as advanced light-trapping techniques to reduce reflection losses.

While lab efficiency records do not directly translate into commercial products, they provide an important benchmark for the potential of solar photovoltaic technology. The steady rise of lab cell efficiency over decades demonstrates the continued progress and improvement of solar PV devices.

Commercial Panel Efficiency

The efficiency of commercial solar panels has steadily increased over the past few decades. According to the Center for Sustainable Systems, though most commercial panels have efficiencies from 17% to 20%, researchers have developed PV cells with efficiencies approaching 50% [1]. A recent article notes that panels built using back-contact (IBC) cells are currently the most efficient, with efficiencies up to 23.8% [2]. One source indicates that modern commercial panels generally range from 15% to 22% efficiency, with some high-end models surpassing 22% efficiency [3]. So while typical commercial panels have increased from around 15% to 17-20% efficiency over the past few decades, lab prototypes have achieved even higher efficiencies up to almost 50%.

Cost Declines

The costs of solar panels and associated components like inverters have fallen dramatically over the past decade. According to Revision Energy, since 2010, there has been a 64% reduction in the cost of residential PV systems. The main driver for this cost decrease has been improvements in solar cell efficiency and manufacturing processes, which have allowed panels to generate more electricity for every square meter of solar cells.

Deye Solar notes that solar panel costs have decreased by 75% compared to 2017. The lower costs have made solar power more affordable and accessible for homeowners and businesses looking to adopt renewable energy. As costs continue to decrease, solar electricity is likely to achieve grid parity in more locations, further accelerating adoption.

Drivers of Cost Declines

Two key drivers have led to the dramatic cost declines in solar panel pricing over the past decade: economies of scale and technology improvements.

As solar deployment has scaled up significantly, manufacturers have been able to achieve greater economies of scale. With increased production volumes, fixed costs are spread over more units, reducing per unit costs. Larger factories and manufacturing automation have also contributed to declines. According to The Falling Cost of Solar Energy: Reasons and Implications, the average size of solar module factories increased over 5-fold from 2006 to 2017.

In addition to scale, continual technology improvements and efficiency gains have reduced costs. Solar cell efficiency has increased from around 15% in the mid 2000s to over 20% today for top commercial panels, allowing more electricity to be produced for the same sized systems. Manufacturing techniques have also improved, with thinner silicon wafers and reduced material waste lowering production costs. The Department of Energy reports silicon wafer costs fell almost 90% from 2005 to 2014. These technology gains have compounded with scale effects, further reducing solar pricing year after year.

Challenges Remaining

While solar power has grown substantially over the past few decades, there are still a number of technical and economic challenges that need to be addressed for further growth and large scale adoption of solar energy (Source 1). Key challenges include:

Reducing costs – While costs have declined dramatically, solar energy still remains more expensive than fossil fuel alternatives in many locations. Further cost reductions through improved manufacturing, efficiency gains, and scale are needed (Source 2).

Improving storage capacity – Solar energy generation is intermittent and doesn’t match peak energy demand cycles in many regions. Economical large-scale energy storage solutions are needed to allow greater penetration of solar power on the grid (Source 1).

Expanding transmission infrastructure – New or upgraded transmission lines are required in many areas to transport solar energy from optimal generation locations to load centers (Source 2).

Increasing efficiency – While commercial solar cell efficiencies have improved, further gains are still possible through new materials and technologies (Source 1). This can lower costs and improve solar competitiveness.

Overcoming policy and regulatory hurdles – Policy incentives and regulatory changes are often needed to encourage further solar adoption and remove barriers. Streamlining permitting, grid access, and financing remains a key priority (Source 3).

The Future

Emerging solar cell technologies like perovskites have the potential to dramatically improve solar panel efficiency in the future. Perovskite solar cells can achieve efficiencies over 25%, much higher than traditional silicon solar panels. Research on perovskites is ongoing, and they are expected to play a major role as solar power scales up globally.

Some projections show that perovskite solar panels along with continuous improvements in silicon solar technology could enable solar electricity prices to fall below 2 cents per kWh by 2050. This would make solar power cheaper than fossil fuels virtually everywhere. Widespread adoption of solar energy will be key for transitioning to a 100% renewable energy system and mitigating climate change.


In conclusion, solar technology has improved dramatically over the past several decades and is poised to continue progressing rapidly in the years ahead. The efficiency of solar cells has steadily increased, enabling solar panels to convert sunlight into electricity much more effectively. Meanwhile, costs have plunged as manufacturing has scaled up and improved. These cost declines have enabled solar power to become cost competitive with fossil fuels in many parts of the world, driving rapid growth in solar installations globally.

Yet despite the impressive improvements, opportunities remain to further advance solar technology and reduce costs. Continued research and development is leading to new solar cell designs, novel manufacturing techniques, and system-level innovations that will unlock additional efficiency gains and cost reductions. As solar continues along its exponential growth curve, it is clear that solar energy will be a critical part of the global energy mix of the future.

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