Photovoltaics — Technical, Economic, and Environmental Aspects

Photovoltaic energy is the renewable energy source with the greatest potential and represents a unique asset in helping humanity achieve carbon neutrality.

One of the major challenges facing the photovoltaic sector is demonstrating its ability to achieve electricity prices competitive with those of other carbon-based and carbon-free electricity sources. This has been the goal of industry stakeholders for nearly 50 years, ever since the technology was first developed. We will see that, thanks to the rise of silicon-based technologies, incremental innovation, and the scaling up of production, this goal has now been achieved—and even surpassed—since solar power is now the cheapest source of electricity in the world.

The market began to develop in the early 2000s thanks to extensive government subsidies in a number of key countries. Then, as prices became increasingly competitive, the market expanded rapidly across all continents, and product diversification allowed for a growing range of applications.

The mass production driven by Wright’s Law is a very powerful driver of the reduction in photovoltaic module prices; it has enabled an unprecedented reduction in photovoltaic module prices over the past nearly 50 years. Indeed, photovoltaics is a modular technology capable of scaling to all levels of production (from watts to terawatts) thanks to the production of billions of cells; mass production and technological innovation have made it possible to drastically reduce costs.

The rise of photovoltaics began in Europe in the early 2000s, driven not only by market forces but also by scientific, technological, and industrial developments. Since then, the landscape has been transformed by China’s overwhelming dominance over the past decade. In fact, China has implemented a proactive, coherent policy over the past 20 years to become a leader in renewable energy, particularly photovoltaics. The vast majority of the entire PV module manufacturing value chain (from silicon to the finished module) is now produced in China or Southeast Asia by Chinese companies (more than 90%, or even 95%). However, this dominance is not inevitable, and Europe must take action to regain sovereignty in this strategic sector by creating market conditions that favor “Made in Europe” products!

The cost of photovoltaic electricity is now the lowest of all electricity sources (as measured by the LCOE). Nevertheless, this electricity is generated only during the day and may not align with demand. This poses challenges for balancing the power grid from an energy perspective, as well as potential issues regarding its frequency stability. This is why new complementary technologies are being deployed. These include “grid forming” for grid stability, as well as battery-based electricity storage, which allows energy to be stored during...