Status and prospects of PV technology

Referencing: Solar Energy - the Physics and Engineering of Photovoltaic Conversion, Technologies and Systems, Chapter 2.

As of 2013, the largest cumulative installed PV power capacity is installed in Europe.  The next largest share of installed power is in Asia Pacific, of which the largest share is in Japan.  There's also a large increase in installed power in China from 2010 to 2013.  The fraction of PV installations in different countries can be seen in this diagram, courtesy of the European Photovoltaic Industry Association EPIA.

There are 2 components in the price of a PV system - module price, and the price of non-modular components of a PV system, also known as the cost of the balance of system.  As of 2011, the average retail price of PV modules has reduced to below 1 USD per Watt-peak (W_p), where W_p is the peak or maximum power a PV module produces when it is illuminated with the standardised AM1.5 solar spectrum.

However, the costs of the balance of system (racking, wiring, inverter, batteries, maintenance, etc) has not reduced as much.  Hence, PV technologies with high energy conversion efficiencies cost less to produce and deliver the same PV power.  This is because less area and non-modular components are needed for higher energy conversion efficiency systems.

A comparison can be made between the non-fossil fuel electricity generation technologies, where the total installed power of each technology is multiplied by a Capacity Factor C_F to derive the average power generated.  The final results after applying the C_F is shown in the diagram below.  It can be seen that solar power will become the most important non-fossil fuel electricity generation technology by 2020.

This forecast is due to 2 factors.  Firstly, solar energy as a renewable energy is available in abundance.  Solar energy reaching Earth is 10,000 times larger than the total energy consumption of mankind.  Secondly, solar PV systems can be installed in a decentralised manner, on the rooftops of the homes of electricity consumers.  Due to the falling costs of PV systems (below grid parity), the costs of PV generated electricity is cheaper than electricity from the power grid.