Photovoltaic Energy Factsheet

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Solar energy can be harnessed in two basic ways. First, solar thermal technologies utilize sunlight to heat water for domestic uses, warm building spaces, or heat fluids to drive electricity-generating turbines. Second, photovoltaics (PVs) are semiconductors that generate electricity directly from sunlight. Solar technologies generated 3.4% of U.S. electricity in 2022.1

Solar Resource and Potential

  • On average, 1.73 x 10⁵ terawatts (TW) of solar radiation continuously strike the Earth, while global electricity demand averages 2.9 TW.3,4
  • Electricity demand varies throughout the day. Energy storage and demand forecasting will help to match PV generation with demand.5
  • If co-located with demand, solar PV can be used to reduce stress on electricity distribution networks, especially during demand peaks.6
  • PV conversion efficiency is the percentage of incident solar energy that is converted to electricity.7
  • Though most commercial panels have efficiencies from 17% to 20%, researchers have developed PV cells with efficiencies approaching 50%.8,9
  • Assuming intermediate efficiency, PV covering 0.6% of U.S. land area would generate enough electricity to meet national demand.10
  • In 2011, the U.S. Department of Energy (DOE) announced the SunShot Initiative. Its aim was to reduce the cost of solar energy by 75%, making it cost competitive with other energy options. In 2017, DOE announced that the 2020 goal of utility-scale solar for $0.06/kWh had been achieved three years early. The 2030 goal includes reducing utility-scale solar energy to $0.03/kWh, cheaper than electricity from fossil fuel energy resources.11


​Annual Average Solar Radiation2
Annual Average Solar Radiation


PV Technology and Impacts

PV Cells

  • PV cells are made from semiconductor materials that free electrons when light strikes the surface, producing an electrical current.15
  • Most PV cells are small, rectangular, and produce a few watts of direct current (DC) electricity.16
  • PV cells also include electrical contacts that allow electrons to flow to the load and surface coatings that reduce light reflection.15
  • A variety of semiconductor materials can be used for PVs, including silicon, copper indium gallium diselenide (CIGS), cadmium telluride (CdTe), perovskites, and even some organic compounds (OPV).15 Although PV conversion efficiency is an important metric, cost efficiency— the cost per watt of power—is more important for most applications.


PV Technology Types and Efficiencies9,12
PV Technology Types and Efficiencies9,12


PV Cell Diagram13
PV Cell Diagram


PV Modules and Balance of System (BOS)

  • PV modules typically comprise a rectangular grid of 60 to 72 cells, laminated between a transparent front surface and a structural back surface. They usually have metal frames and weigh 34 to 62 pounds.17
  • A PV array is a group of modules, connected electrically and fastened to a rigid structure.18
  • BOS components include any elements necessary in addition to the actual PV panels, such as wires that connect modules, junction boxes to merge the circuits, mounting hardware, and power electronics that manage the PV array’s output.18
  • An inverter is a power electronic device that converts electricity generated by PV systems from DC to alternating current (AC).18
  • A charge controller is a power electronic device used to manage energy storage in batteries, which themselves are BOS components.18
  • In contrast to a rack-mounted PV array, Building Integrated PV (BIPV) replaces building materials such as shingles and improves PV aesthetics.19
  • Some ground-mount PV arrays employ a solar tracker. This technology can increase energy output by up to 100%.20


​Residential PV System14
Residential PV System


PV Installation, Manufacturing, and Cost

  • In 2022, global PV power capacity grew by 239 GW and reached almost 1,200 GW, or 1.2 Terawatt (TW). Solar PV capacity has grown by nearly 750 times since 2000.23
  • Top installers in 2022 were China (94.7 GW), the U.S. (21.9 GW), and India (17.4 GW).23
  • New PV installations grew by 45% in 2022 and accounted for 66% of global renewable capacity additions. Even with this significant growth, solar power only accounts for 4.5% of global power generation.23
  • The cost of solar power has dropped over 80% since 2009. Various contracts have been signed around the world with solar power prices as low as 1-2¢/kWh; this is much cheaper than conventional power sources.24 In comparison, U.S. retail electricity averaged 12.49¢/kWh for all sectors and 15.12¢/kWh for residential users in 2022.1
  • In 2023, global investment in solar power is estimated to be $380 billion. This accounts for 14% of the total amount invested in energy worldwide.25
  • Including sectors such as manufacturing, sales, distribution, and installation, there are over 231,000 U.S. solar jobs.18


World Cumulative Installed PV Capacity21


World Cumulative Installed PV Capacity21
Median Installed Price, Residential, Commercial, and Utility-Scale PV Systems22
Median Installed Price, Residential, Commercial, and Utility-Scale PV Systems22

Energy Performance and Environmental Impacts

  • Net energy ratio compares the life cycle energy output of a PV system to its life cycle primary energy input. One study showed that amorphous silicon PVs generate 3 to 6 times more energy than are required to produce them.26
  • Reusing multi-crystalline cells can reduce manufacturing energy by over 50%.27
  • Although pollutants and toxic substances are emitted during PV manufacturing, life cycle emissions are low. For example, the life cycle emissions of thin-film CdTe are roughly 14 g CO₂e per kWh delivered, far below electricity sources such as coal (1,001 g CO₂e/kWh).28,29
  • PVs on average consume less water to generate electricity (26 gallons per MWh), compared to nonrenewable technologies such as coal (687 gallons per MWh).30

Solutions and Sustainable Actions

Policies Promoting Renewables

  • Consumers that do not have roof space for PV panels can join community solar programs, which are local solar projects that community members can share and receive credit on their electricity bills.31 Property assessed clean energy (PACE) programs allow property owners to finance the upfront costs of a solar installation through a voluntary assessment on annual property taxes.32 Green banks and other lending institutions are being developed to specifically fund and support clean energy projects on local, regional, and national scales.33
  • Carbon cap-and-trade policies would work in favor of PVs by increasing the cost of fossil fuel energy generation.34
  • The Inflation Reduction Act of 2022 expanded the federal Investment Tax Credit (ITC) to 30% until 2032 for the installation of a solar PV system, a savings of over $7,500 for an average system.35
  • PV policy incentives include renewable portfolio standards (RPS), feed-in tariffs (FIT), capacity rebates, and net metering.
    • An RPS requires electricity providers to obtain a minimum fraction of energy from renewable resources.36
    • A FIT sets a minimum per kWh price that retail electricity providers must pay renewable electricity generators.37
    • Capacity rebates are one-time, up-front payments for building renewable energy projects, based on installed capacity (in watts).37
    • With net metering, PV owners get credit from the utility (up to their annual energy use) for energy returned to the grid.37

What You Can Do

  • “Green pricing” allows customers to pay a premium for electricity that supports investment in renewable technologies. Renewable Energy Certificates (RECs) can be purchased to “offset” commodity electricity usage and help renewable energy become more competitive.38

Future Technology

  • Emerging PV technologies include perovskites, bifiacial PV modules, and concentrator PV (CPV) technology. Perovskite solar cells have a high conversion efficiency (over 25%) and low production cost. Bifacial modules are able to collect light on both sides of the PV cells. CPV utilizes low-cost optics to concentrate light onto a small solar cell.39,40,41
  • Designing for end-of-life could improve the current 10% rate of PV module recycling.42
A watt is a unit of power, or a rate of energy flow. 1 TW = 1,000 GW = 1,000,000 MW = 1,000,000,000 kW.
A kilowatt-hour is a unit of energy. 1 kWh is the electricity energy required to light a 100 watt light bulb for 10 hours.


Cite As

Center for Sustainable Systems, University of Michigan. 2023. "Photovoltaic Energy Factsheet." Pub. No. CSS07-08.

  1. U.S. Energy Information Administration (EIA) (2023) Monthly Energy Review June 2023.
  2. U.S. Department of Energy (DOE), National Renewable Energy Lab (NREL) (2018) U.S. Annual Solar GHI map.
  3. National Oceanic and Atmospheric Administration (2017) “Energy on a Sphere.”
  4. U.S. EIA (2023) International Energy Statistics.
  5. U.S. DOE, Energy Efficiency and Renewable Energy (EERE) (2017) “Confronting the Duck Curve: How to Address Over-Generation of Solar Energy.”
  6. America’s Energy Future Panel on Electricity from Renewable Resources, National Research Council (2010) Electricity from Renewable Resources: Status, Prospects, and Impediments.
  7. U.S. DOE, EERE (2023) “Solar Performance and Efficiency.”
  8. Energy Sage (2023) “What are the Most Effiecient Solar Panels? Top Brands in 2023.”
  9. NREL (2023) Best Research-Cell Efficiencies.
  10. NREL (2012) SunShot Vision Study.
  11. U.S. DOE (2021) “The SunShot Initiative.”
  12. NREL (2023) Champion Module Efficiencies.
  13. Adapted from NASA Science (2008) “How Do Photovoltaics Work?”
  14. Photo courtesy of National Renewable Energy Laboratory, NREL-45218.
  15. U.S. DOE, EERE (2021) “Solar Photovoltaic Cell Basics.”
  16. U.S. DOE, EERE (2021) “Solar Photovoltaic Technology Basics.”
  17. Platzer, M. (2015) U.S. Solar Photovoltaic Manufacturing: Industry Trends, Global Competition, Federal Support. Congressional Research Service.
  18. Congressional Research Service (2023) Solar Energy: Frequently Asked Questions.
  19. Barbose, G., et al (2014) Tracking the Sun VI: An Historical Summary of the Installed Price of Photovoltaics in the United States from 1998 to 2012. Lawrence Berkeley National Laboratory, LBNL6350E.2013.2017.
  20. Mousazadeh, H., et al. (2009) “A review of principle and sun-tracking methods for maximizing solar systems output.” Renewable and Sustainable Energy Reviews, 13:1800-1818.
  21. International Energy Agency (2022) Trends 2022 in Photovoltaic Applications 2022.
  22. NREL (2022) U.S. Solar Photovoltaic System and Energy Storage Cost Benchmarks, With Minimum sustainable Price Analysis: Q1 2022.
  23. Solar Power Europe (2023) Global Market Outlook For Solar Power 2023-2027.
  24. Solar Power Europe (2021) Global Market Outlook For Solar Power 2021-2025.
  25. EIA (2023) World Energy Investment 2023.
  26. Pacca, S., et al. (2007) “Parameters affecting life cycle performance of PV technologies and systems.” Energy Policy, 35:3316–3326.
  27. Muller, A., et al. (2006) “Life cycle analysis of solar module recycling process.” Materials Research Society Symposium Proceedings, 895.
  28. Kim, H., et al (2012) “Life cycle greenhouse gas emissions of thin-film photovoltaic electricity generation.” Journal of Industrial Ecology, 16: S110-S121.
  29. Whitaker, M., et al. (2012) “Life cycle greenhouse gas emissions of coal-fired electricity generation.” Journal of Industrial Ecology, 16: S53-S72.
  30. NREL (2011) Review of Operational Water Consumption and Withdrawal Factors for Electricity Generating Technologies.
  31. Solar Energy Industries Association (SEIA) (2021) “Community Solar.”
  32. U.S. DOE, EERE (2021) “Property Assessed Clean Energy Programs.”
  33. Clean Energy Credit Union (2023) “Our Mission.”
  34. Bird, L., et al. (2008) “Implications of carbon cap-and-trade for U.S. voluntary renewable energy markets.” Energy Policy, 36(6): 2063-2073.
  35. U.S. DOE, EERE (2023) “Solar Investment Tax Credit: What Changed?”
  36. U.S. EPA (2021) “State Renewable Energy Resources.”
  37. U.S. DOE, EERE (2022) Solar Power in Your Community: A Guide for Local Governments.
  38. U.S. Environmental Protection Agency (2021) “Green Power Supply Options.”
  39. U.S. DOE EERE (2022) “Perovskite Solar Cells.”
  40. NREL (2016) Evaluation and Field Assessment of Bifacial Photovoltaic Module Power Rating Methodologies.
  41. NREL (2017) Current Status of Concentrator Photovoltaic Technology.
  42. NREL (2021) Solar Photovoltaic Module Recycling: A Survey of U.S. Policies and Initiatives.

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