IPCC Fourth Assessment Report: Climate Change 2007
Climate Change 2007: Working Group III: Mitigation of Climate Change Solar photovoltaic (PV)

Electricity generated directly by utilizing solar photons to create free electrons in a PV cell is estimated to have a technical potential of at least 450,000 TWh/yr (Renewables, 2004; WEC, 2004d). However, realizing this potential will be severely limited by land, energy-storage and investment constraints. Estimates of current global installed peak capacity vary widely, including 2400 MW (Greenpeace, 2004); 3100 MW (Maycock, 2003); >4000MW generating more than 21 TWh (Martinot et al., 2005) and 5000 MW (Greenpeace, 2006). Half the potential may be grid-connected, primarily in Germany, Japan and California, and grow at annual rates of 50–60% in contrast to more modest rates of 15–20% for off-grid PV. Expansion is taking place at around 30% per year in developing countries where around 20% of all new global PV capacity was installed in 2004, mainly in rural areas where grid electricity is either not available or unreliable (WEC, 2004c). Decentralized generation by solar PV is already economically feasible for villages with long distances to a distribution grid and where providing basic lighting and radio is socially desirable. Annual PV module production grew from 740 MW in 2003 to 1700 MW in 2005, with new manufacturing plant capacity built to meet growing demand (Martinot et al., 2005). Japan is the world market leader, producing over half the present annual production (IEA, 2003f). However, solar generation remains at only 0.004% of total world power.

Most commercially available solar PV modules are based on crystalline silicon cells with monocrystalline at up to 18% efficiency, having 33.2% of the market share. Polycrystalline cells at up to 15% efficiency are cheaper per Wp (peak Watt) and have 56.3% market share. Modules costing 3–4 US$/Wp can be installed for around 6–7 US$/Wp from which electricity can be generated for around 250 US$/MWh in high sunshine regions (US Climate Change Technology Program, 2005). Cost reductions are expected to continue (UNDP, 2000; Figure 4.11), partly depending on the future world price for silicon; solar-cell efficiency improvements as a result of R&D investment; mass production of solar panels and learning through project experience. Costs in new buildings can be reduced where PV systems are designed to be an integral part of the roof, walls or even windows.

Thinner cell materials have prospects for cost reduction, including thin-film silicon cells (8.8% of market share in 2003), thin-film copper indium diselenide cells (0.7% of market share), photochemical cells and polymer cells. Commercial thin-film cells have efficiencies up to 8%, but 10–12% should be feasible within the next few years. Experimental multilayer cells have reached higher efficiencies but their cost remains high. Work to reduce the cost of manufacturing, using low-cost polymer materials, and developing new materials such as quantum dots and nano-structures, could allow the solar resource to be more fully exploited. Combining solar thermal and PV power-generation systems into one unit has good potential as using the heat produced from cooling the PV cells would make it more efficient (Bakker et al., 2005).