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    How to Calculate Solar Panel Efficiency

    When deciding on the components of your solar power system, you may be curious about the efficiency of the solar panels. This article explains exactly how this can be calculated, and everything else you need to know about solar panel efficiency.

    The equation below can be used to calculate the approximate efficiency of a solar panel, as a percentage:

    Firstly, it is important to stress that efficiency of a solar panel is a matter of area, not power. A 10% efficient 100W panel and a 20% efficient 100W panel will both produce exactly the same amount of power. However, you should expect the 20% efficient solar panel to be half the total size of the 10% efficient panel.

    To determine the efficiency of the panel, we need to compare the power that the sun provides to the panel to the electricity that is produced. If a panel was able to convert all of the light that falls on it into electricity, then that panel would be 100% efficient. Unfortunately, this level of efficiency is impossible.

    The theoretical maximum efficiency of a solar cell made of ideal material is 33.7%. This is known as the Shockley-Quiesser limit, and is a consequence of the laws of physics and how solar cells absorb power. Multi-layered solar cells can exceed this limit in lab conditions, but are significantly harder to manufacture and much more expensive so are typically only used for satellites and other hi-tech systems where space is extremely limited.

    For silicon solar cells (the kind in almost every panel you can buy) the theoretical limit is about 32% as silicon, though close, is not a perfect solar cell material. Mass market solar cells will always experience some power loss compared to this and can only achieve a maximum of up to 25% in ideal conditions. The efficiency of a panel as a whole will always be lower than its component cells due to the frame, reflective metal contacts, and gaps between the cells.

    To begin comparing the sun’s power to the panel’s electricity output, we first need to know the sun’s power. At midday near the equator, just over 1kW (1000W) of sunlight reaches every square meter of the ground. Away from the equator and in different seasons, weather conditions and times of day this will be less, but the 1kW per square meter value is used when testing panels to give the power rating they are sold as. This part of the standard test conditions (STC) that the solar power industry uses, and all panels are rated in the same way.

    Imagine a panel with an area of 1 square meter. If it produced 1kW of electricity at noon on the equator we could say that it was 100% efficient as it would receive 1kW of sunlight and turn that into the same amount of electricity. If a panel the same size instead produced 200W of power, then its efficiency is 200W/1000W x 100 = 20%. If we instead express this in kW then the equation becomes even simpler, as 0.2kW/1kW = 0.2 so the sun’s power can be ignored in the calculation. The ratio is multiplied by 100 to give an answer in percentage.

    To perform this calculation for any solar panel that isn’t 1 square meter, we need to know the area of the panel. If a panel is half as big and produces the same power it is twice as efficient, and vice versa. The area can be easily calculated from the panel’s dimensions by multiplying the width by the length. Remember to convert the dimensions into meters first as areas do not convert in the same way as lengths (i.e. 1 square meter is not 1000 square millimetres, it is 1 million square millimetres).

    Finally, to calculate the maximum efficiency of the solar panel we need to divide the ratio of panel power to sun power by the area of the panel in square meters, then times by 100 to get a percentage. Make sure the measurement units of all the values are correct or you will end up with very strange results.

    Take, for example, our 300W rigid frame panel with monocrystalline silicon cells. Its power is 300W or 0.3kW, it is 1.64m long and 0.99m wide. The efficiency is therefore:

    This is the approximate efficiency of the panel as a whole, so as mentioned above we would expect it to be lower than the efficiency of the cells because of the frame and gaps between the solar cells (increasing the area) and normal losses as the electricity travels through the panel and wires. For a higher efficiency panel of the same area, the power would be higher than 300W. For a higher efficiency panel of the same power, the area would be smaller.

    Most Efficient Solar Panels Of 2023 (Guide)

    Samantha covers all topics home-related including home improvement and repair. She previously edited home repair and design content at The Spruce and HomeAdvisor. She also has hosted videos on DIY home tips and solutions and launched multiple home improvement review boards staffed with licensed pros.

    We earn a commission from partner links on Forbes Home. Commissions do not affect our editors’ opinions or evaluations.

    Installing the solar panels for your home is an excellent way to conserve energy and lower utility bills. However, it’s important to understand the differences in the fabrication of solar panels in order to choose the most efficient solar panels for your commercial or residential installation. For those looking to install solar at home, we’ve searched for and found the best solar companies for consideration.

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    How Efficient Are Solar Panels?

    The efficiency of solar panels is determined by the amount of sunlight reflected on the panels’ surface, which is then transformed into electrical or thermal energy. Previously, the average efficiency of solar panels was around 15%, but thanks to advancements in photovoltaic technology, the efficiency of solar panels is currently between 15% and 22%. High-efficiency solar panels can even reach nearly 23%. As a result, 370W is the typical power rating of a panel, an improvement from 250W. Two factors go into determining solar panel efficiency: photovoltaic (PV) cell efficiency and total panel efficiency.

    Panel Efficiency

    PV cell efficiency comes as the result of the cell design and silicon type, while cell layout and configuration along with the solar panel size are the basis for total panel efficiency.

    Cell Efficiency

    Total panel efficiency is determined by the maximum power rating under standard test conditions divided by the total area of the panels (in meters).

    Most Efficient Solar Panels

    While the most efficient readily available panels all share efficiency percentages above 20%, Canadian Solar’s HiHero series panels are tied with SunPower for the highest efficiency rating at 22.80% under optimal conditions.

    However, the Canadian Solar HiHero 445 H-AG solar panel has a temperature coefficient of 0.26%. Compared to SunPower’s coefficient of 0.29%, the HiHero edges out its competition when the temperature rises over 77 degrees Fahrenheit.

    Canadian Solar HiHero High Efficiency Heterojunction (HJT) Cell Module 445H-AG -0.26 22.80%
    SunPower 420-440W Residential AC Module M-Series: M440 -0.29 22.80%
    Q Cells Q.Peak Duo Blk ML-G10 £410.00 -0.27 20.90%
    REC Solar REC Alpha Pure-R REC430AA PURE-R -0.26 22.30%
    Panasonic Solar EverVolt™ Series EVPV410H -0.26 22.20%
    Silfab SILFAB Elite SIL. 380 BK 0.38 21.40%
    Residential panels with data correct as of April 2023

    Canadian Solar

    Canadian Solar offers consumers ten solar panel model series. Its lineup of HiKu Mono PERC panels on one end of the spectrum provides up to 425 watts at 20.9% efficiency, while at the other end, the company’s BiHiKu7 models start at 580 watts and continue through six more wattages to reach a whopping 610 watts.

    However, the company’s most efficient solar panel is its HiHero 445 H-AG model, which features a 445-watt capacity at a 22.8% efficiency rating and a 0.26% coefficient rating.


    SunPower offers three lines of residential panels along with components and energy storage systems. The company’s M series solar panels consist of five models that range in efficiency from 21.7% in the M420 model to the highest in our review, the M440, with a 22.8% rating.

    SunPower’s two other series are the X and U lines. The X lineup uses the company’s own Maxeon technology and ranges from 21.2% to 22.7% in efficiency. The U series is SunPower’s most recent budget-friendly addition that steers away from using Maxeon panels but still comes with similar warranty protections.

    Q Cells

    Q Cell’s residential panel selection includes several models in the Q-Peak Duo BLK ML-G10 and the Q-Peak Duo BLK-G10 lines. The BLK-G10 series features panels that range from 350W to 370W with efficiency ratings from 19.5% to 20.6%.

    The ML-G10 is Q Cell’s most recent lineup featuring higher watt ratings and slightly higher efficiency. Panels in the series include a 385W model with 19.6% efficiency and five more models. The most powerful one in the series is a 410-watt panel with 20.9% maximum efficiency and a temperature coefficient of 0.27%.

    REC Solar

    REC Solar provides five solar panel series to choose from—Starting with its 360W to 375W N-Peak 2 series and increasing in wattage capacity through each series. Its most powerful and efficient panel is the company’s Alpha Pure-R, featuring 430 watts of power rated at 22.3% efficiency with a coefficiency percentage of 0.26.

    Panasonic Solar

    Among numerous industries that Panasonic is involved in, the company offers a selection of 15-panel models in six series variations in its solar energy sector. The collection, called Evervolt, consists of residential solar panels with watt ratings from 350 to 410.

    The highest wattage Evervolt H Series Solar Module offers 410 watts with a 22.20% efficiency rating and a 0.26% temperature coefficient.

    Silfab Solar

    Silfab’s solar panel offerings include two residential series, Silfab Prime and Silfab Elite. Models available in both series have efficiency ratings topping out at 21.4%. The company’s most powerful panel, the SIL-410 BG churns out up to 410 watts with a coefficiency rating of 0.377%

    How You Can Check Solar Panel Efficiency

    Monitoring your solar panels’ performance and efficiencies allows you to compare calculations to keep an eye out for panel degradation, or notice sudden drops in efficiency that could indicate a problem with the system.

    To calculate the efficiency of an individual panel, you’ll need to measure the surface dimensions and determine the total production area in meters squared. You’ll also need the current power production amount in kilowatts.

    There are several ways to determine the kilowatt output. If you’re looking for the panel’s potential, simply use the panel watt rating for the calculation and divide by 1,000. For more accurate testing, take the wattage number from your solar meter or use a multimeter to measure volts and amps. Multiply the two results to arrive at the total watts. Divide the watts by 1,000 to reach the kW measurement.

    With those two numbers, divide the panel output by the total area of the solar panel surface in square meters. Multiply the result by 100. The total is your current efficiency rating of the panels you’re testing.

    For example, a solar panel that measures 182 cm by 106 cm has a surface area of 1.82 m x 1.06 m or 1.93 square meters. If the panel is producing 400 watts or 0.40 kW. Dividing 0.40 by 1.93 equals 0.207. Multiply by 100 for an efficiency reading of 20.7%.

    Efficiency by Solar Panel Type

    There are three types of solar panels that are most often used in commercial or residential installations: monocrystalline, polycrystalline, and thin-film. Here is a brief explanation of each, as well as for what applications they are most useful:


    Monocrystalline solar panels are often touted as the most efficient option and are often installed for larger energy systems in commercial and residential properties. However, panel sizes do vary; therefore, monocrystalline can be used in smaller installations as well.


    • Made out of silicon with a high purity rating, boosting their efficiency to 15% to 23%
    • Don’t require as much space as polycrystalline and thin-film panels
    • Monocrystalline panels can last upwards of 25 years due to the stable and inert properties of the silicon


    • Price point is high because of their complex construction
    • Not a good choice for cold-weather climates, as snowfall can damage the solar cells and cause the system to fail.

    Monocrystalline brands: SunPower, LG, and Panasonic


    Like the name suggests, polycrystalline solar panels are constructed from multiple pure silicon crystals that are melted together. crystals aren’t always better, though. Polycrystalline panels are actually less efficient than their monocrystalline counterparts. They are, however, made in a variety of power settings ranging from 5W to 250W and higher, making them a good choice for both small and large-scale installations.


    • Process to create them is simpler, so they are less expensive than monocrystalline
    • Less waste after the melting process, making them better for the environment
    • Durable and long-lasting, just like monocrystalline solar panels, so they are a good choice for budget-minded homeowners


    • Lower efficiency (13% to 17%) because the silicon used to make them is lower in purity.
    • Take up more space to produce the same level of power as that of monocrystalline cells.

    Polycrystalline brands: TrinaSolar and YingliSolar

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    Though they are lightweight and easy to move, thin-film PV cells—which are not made of silicon—are the least efficient type of solar panel. Use them only for installation that won’t need to produce too much power; flexibility and portability are the two top factors with these.


    • Easier and less expensive to produce
    • Excellent for solar transportation applications, such as panels that are installed on bus rooftops and refrigeration for cold-storage trucks


    • Not a good choice for rooftops, as they require a large space to harness enough solar power for energy output.
    • Weaker so they break down more quickly than crystalline panels. Only short warranties are available for thin-film panel installations, which is something homeowners especially should consider depending on how long they plan to stay in their homes.

    Thin-film brands: Stion and Solopower

    Factors That Impact Solar Efficiency

    Several things can affect solar panels’ efficiencies, such as the type of solar panel, the inverter efficiency, thermal cycling, etc. Here are some factors to consider before purchasing a solar panel system:

    Solar Panel Types

    When figuring out which type of solar panel is right for your home, the first thing to do is to get acquainted with each type, its construction and its efficiency:

    • Monocrystalline Solar Panels: The most popular and most efficient type of solar panels, monocrystalline solar panels, are popular amongst residences and businesses. They are made of individual pure silicon crystal and can generate between 300 and 400 (sometimes even more) watts of power each.
    • Polycrystalline Solar Panels: Polycrystalline panels are made from several pieces of silicon that are separated into fragments and melted together. They are slightly less expensive but also less efficient than monocrystalline solar panels.
    • Thin-Film Solar Panels: Thin-film solar panels can be made of three different materials: Amorphous Silicon (a-Si), Cadium Telluride (CdTe) and Copper Indium Gallium Selenide (CIGS). Each type of thin-film solar panel is less expensive than both crystalline panels but is also less efficient.

    Sunlight Hours

    While solar panels can generate electricity in various light conditions, even on cloudy days, their efficiency rates drop dramatically during hours with little light available. Generally, about four hours per day of direct sunlight is necessary to achieve the optimum performance of your solar panel array.

    However, during the remaining daylight hours, when sunshine is present but not direct, your solar panels can still generate substantial electrical power. The same is true of overcast days.

    The total number of hours of any kind of sunlight per day directly affects the overall efficiency of your panels in the short term. There are no long-term effects to solar panels that don’t receive an optimal amount of sunlight daily.

    Inverter Efficiency

    The inverter is what converts general Direct Current (DC) to Alternating Current (AC) electricity, which is what your home runs on. Most inverter’s conversion efficiency is around 97% to 99%, so the energy loss is relatively minor.

    Temperature Coefficient

    Solar panel efficiency ratings are measured and recorded under laboratory conditions called Standard Test Conditions or STC. The lab conditions include measurements taken at 25 degrees Celsius (77F). The temperature coefficient rating for solar panels measures the percentage of the panel’s efficiency loss when its surface rises above that temperature.

    For each degree Celcius that the panel’s temperature rises above 25, the panel’s efficiency will lessen by the coefficient rating percentage.

    For example, SunPower’s most powerful solar panel, the M440 produces a maximum output of 440 watts under ideal conditions at 25 degrees Celsius. Its efficiency rating at that temperature is 22.8%. The panel has a temperature coefficient rating of 0.29%.

    When the panel temperature increases by 10 degrees Celsius (50F), which isn’t uncommon under hot sunlight, its efficiency will decrease by 2.9%, meaning its overall efficiency drops below 20%. Essentially, it produces less power when it’s hot.

    Damp Heat

    Solar panel damp heat testing puts a subject solar panel through a rigorous test in which it’s sealed in a chamber kept at 85 degrees Celsius and 85% humidity for 1,000 hours. The test aims to recreate and accelerate the harsh conditions that the product will experience over several years of direct exposure to the elements.

    While damp heat testing doesn’t directly measure the effects of weather on a panel’s efficiency, the process tests the unit’s integrity related to delamination and corrosion, which, in turn, affect the panel’s overall efficiency.

    Thermal Cycling

    Thermal cycling tests your solar panel to see if it can withstand a wide temperature range. Solar panel components can expand and contract during Thermal Cycling, which may affect their efficiency.

    Solar Panel Orientation

    South-facing roofs are ideal for generating electricity with solar panels. West-facing roofs are the next best option, and east-facing roofs are next. If you have a north-facing roof, you may want to reconsider. West and east-facing panels will generate up to 15% less energy than a south-facing array while north-facing panels can lose as much as 20%.

    Identifying the prime installation angle towards the sun is essential to optimize solar panel performance. The exact angle degree varies based on latitude but generally lands between 30 and 45 degrees. The installation angle affects how much time per day the panel receives direct sunlight.

    The installation angle is most impactful during winter when the sun is lower on the horizon. Correct orientation and angle during winter can yield around 50% more energy than panels installed without the same consideration.

    Environmental Factors That Impact Solar Efficiency

    In addition to the typical factors, your environment is also something to consider before purchasing a solar panel system. Environmental factors such as average temperature, weather conditions and even dust and dirt build-up also impact solar efficiency.


    Solar panels work best at about 77°F, with peak efficiency between 59°F and 95°F. However, when the surface temperature of your solar panels gets higher than 149°F, solar panel efficiency can decline.


    The color of the back sheet that protects the panels can also affect efficiency. For example, while black might look more attractive for a protective back sheet, the color absorbs more heat. This results in higher temperatures and, therefore, a reduction in the total conversion efficiency, so other colors like dark blue, green or even patterns might be a better option for your solar panels.

    Extreme Weather Conditions

    Anything that stands between the sun and your solar panels reduces the amount of solar energy your system produces. Therefore, extreme weather conditions such as snow, wind, rain and hail can potentially affect your solar panel’s efficiency.

    Since snow accumulates onto the surface of your solar panels, the sun cannot penetrate the panels, which will ultimately affect the efficiency of your system.

    Since the wind could potentially cool your solar panels down, the wind can make them more efficient as long as the sun is still shining on them.

    Rain does not affect your solar panel efficiency; however, rain clouds could affect how much sun reaches them. However, constant rainstorms help keep layers of dirt and dust from covering the panels and blocking the light, which could decrease solar energy production.

    Unlike snow and rain, a hail storm can present slight problems for your solar panels. Although solar panels have been tested to withstand hail-like conditions, there is a chance of solar panel damage from a hail storm.

    Dust and Grime Build Up

    As time passes, your solar panels are bound to have some dust and grime build up due to the elements. If there is a layer of dust and grime on your solar panels, the sun will not be able to effectively reach the panels, causing a lapse in efficiency until the panels are cleaned.

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    Why Is Solar Panel Efficiency Important?

    Solar panel efficiency is measured by the percentage of sunlight that hits your panel and is converted into usable electricity. Therefore, efficiency is most important when roof space is limited.

    For instance, if you have limited roof space and cannot fit as many solar panels on your roof as you would like, it may make sense to pay more to install higher-efficiency panels to absorb as much sunlight as possible.

    However, lower-efficiency panels will produce the same energy as high-efficiency ones, but they’ll require more to do so and more space. Therefore, lower-efficiency panels can cover your electricity use and help you save money if you have the space to house them.

    The amount of power a panel with 15% efficiency can create can be as much as 100 watts less than a panel of the same size that can achieve 22% efficiency. In an average residential solar setup, the home could require up to eight additional 15% solar panels to generate the same power as 20 units at 22%.

    Why Aren’t Solar Panels 100% Efficient?

    A panel with 100% efficiency can transform all the light that hits the panel into electrical energy. However, since solar panels cannot absorb energy from the entire solar spectrum, they cannot convert sunlight into electricity with 100% efficiency. Specific wavelengths of light are reflected off the solar panels or lost altogether.

    What to Consider When Installing Solar Power Panels


    Solar panels can be costly upfront, which is why many homeowners do not take the decision to go solar lightly. The Center for Sustainable Energy reports that the installation can cost, on average, between 15,000 and 25,000. Polycrystalline solar panels are considered the most cost-effective choice in solar panel installations, but it depends on the type of panels and how many are needed for installation.

    While your initial investment in solar panels can be recouped over the years, it might take longer for you to see back your money based on a number of factors, including energy usage and weather conditions; the latter might affect solar panel functionality.


    Solar-powered energy, not surprisingly, is more efficient in places where there is more sun exposure. Residential and commercial buildings in Southern California, for example, would likely reap the benefits of solar power more so than those in the cloudy Pacific Northwest. Still, even places that aren’t the sunniest can benefit from solar power, as cooler temperatures will cause the panels to create more power.

    Energy Usage

    If your energy bills are high, then it makes sense to install solar panels to reduce costs and to earn back the initial investment over time. However, if your energy usage is minimal, solar panel installation might not be worth the expense. It is also important to note that top efficiency is only achieved in top conditions and only at the beginning of the panel’s lifetime of use. As the solar panels age and are exposed to the elements, they will begin to perform less efficiently.

    Solar Installation Companies

    The company you choose to install your solar energy system is a crucial decision. While some installers use several solar panel and component manufacturers, many install just one or two brands. Ensure the installation company you choose is willing to install the solar panel brand of your choice and can service the system when necessary.

    Solar Incentives

    The federal residential solar tax credit allows homeowners to deduct 30% of the cost of their installed solar energy system from their taxable income for the year. However, that’s just one of several incentives that may be available depending on your location. Look for local, state and regional incentives as well. Your solar installation company should be well-versed in helping you discover these benefits.

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    THIS IS AN ADVERTISEMENT AND NOT EDITORIAL CONTENT. Please note that we do receive compensation for any products you buy or sign up to via this advertisement, and that compensation impacts the ranking and placement of any offers listed herein. We do not present information about every offer available. The information and savings numbers depicted above are for demonstration purposes only, and your results may vary.

    Frequently Asked Questions (FAQs)

    What is the highest efficiency solar panel?

    Currently, the highest recorded solar panel efficiency rating took place in a lab and is rumored to have reached over 40% efficiency. However, in more practical conditions, the most highly efficient solar panels available to homeowners is Canadian Solar’s HiHero 445 H-AG model.

    What is the most efficient type of solar panel?

    Monocrystalline solar panels are often considered the most efficient solar panel option. Therefore, they are typically installed for larger energy systems in commercial and residential properties.

    How does increased energy efficiency benefit you?

    Increased energy efficiency in solar panels has several benefits for homeowners.

    • Potentially fewer solar panels to purchase and maintain
    • Highly efficient solar panels produce more power in direct and indirect sunlight.

    What solar panel type has the highest efficiency?

    Monocrystalline solar panels are often considered the most efficient solar panel option. Therefore, they are typically installed for larger energy systems in commercial and residential properties.

    How many solar panels do you need?

    With a home of roughly 1500 square feet, it is estimated that 15 to 18 solar panels will be needed.

    Can you DIY a solar panel installation?

    It’s tempting to save money and install solar panels yourself, especially if you have numerous successful DIY projects under your belt. But installing solar panels is a project that is best left to the pros. Depending on the type of panel you choose, installation might require complex configurations that are otherwise difficult to install correctly without the training experience.

    Additionally, professional installation might be required to uphold the warranty. As with many projects, getting a professional to install a solar energy system means that it will be done right the first time so that you can begin reaping the benefits of it immediately.

    How long will it take to recoup the cost of solar panels?

    This answer will vary depending on a variety of factors, including the initial expense of the solar panel system, the amount of energy incentives and electricity usage. On average, though, it takes homeowners six to 10 years to recoup their initial investment.

    How long do solar panels last?

    Solar panels have an average lifespan of 25 to 30 years. However, they can last as many as 50 years. The longevity of solar panels depends on the weather conditions where they are installed, as snow, wind and debris from storms can affect their operation.

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    The Average Solar Panel Is Only 22% Efficient. Perovskites Can Set The Bar Higher

    After studying and working in HR, André studied sustainability management at Lisbon’s School Of Economics Management. He is responsible for the English speaking market of Youmatter since 2018.

    Published at 2020, May 29 th

    How efficient are solar panels? How can their efficiency improve? Besides their benefits, what are the ecological impacts of solar energy?

    What Are Solar Panels and Why They’re Growing Globally

    Solar panels, also known as photovoltaics – which means “light-electricity” – are devices that convert sunlight into electricity. A solar panel is a collection of small silicon-based solar cells which have conductive properties which set electrons into motion and convert sunlight into electricity.

    Over the past 20 years, the costs associated with solar cells have been steadily decreasing. In fact, according to the International Renewable Energy Agency (IRENA), solar PV module have fallen by around 80% since the end of 2009. Price shortfalls and economic gains, together with the urgency to design more ecological and resilient societies led to the growth of renewables, and solar energy, in particular, across electricity grids worldwide.

    However, and despite their benefits – which make them a far more ecological option than fossil-fuels – solar energy is not perfect, as we’ve highlighted in our piece: Is Solar Energy Really Green And Sustainable? Put simply, manufacturing photovoltaic panels can consume a lot of energy and requires finite Earth minerals that have harsh extraction impacts, apart from the many questions still in the air regarding their recycling.

    However, there is also another topic we feel should be analyzed in greater detail: the lack of efficiency of solar panels. How efficient are solar panels?

    How Efficient Are Solar Panels?

    Before answering this question it is important to make sure we are all on the same page regarding what efficiency means within the specific context of solar energy. In this way, efficiency can be understood as to how good the solar panel is at transforming the Sun’s light into electricity.

    In other words, a panel with 100% efficiency would be one that’s able to transform all the light that hits the panel to electrical energy. Scientists define solar efficiency as the ratio of how much power the solar panel generates considering how much power it gets from the Sun.

    A solar panel’s efficiency depends on different variables such as temperature, shade, orientation, and the type of solar cells. The latter is, however, the one needing greater improvements as all the other variables are easier to control. But why?

    The Average Solar Panel Silicon Cells Are Not Very Efficient

    The semiconductors that convert sunlight into electrical energy are seen as inefficient as they only capture a fraction of the light they get. Sunlight spans a broad spectrum of wavelengths, and depending on the characteristics of the semiconductor and the design of the cell, some of that light is reflected, some passes through, and some gets absorbed but converted into heat before the energy can be used.

    Today’s typical silicon solar cell panels operate at around 22% efficiency, while the best silicon solar cell reached a 26.7% efficiency on a lab scale. For this reason, many modern solar research projects are focused on figuring out and designing more efficient sunlight conductors. These new cells must have a higher conversion efficiency, or, in other words, they must be able to convert a greater fraction of incoming sunlight into electrical energy.

    Recent development point out a new promising kind of semiconductors: perovskites. Perovskites are at the center of an effort to develop a new generation of thin-film solar cells that seem to be not only more efficient but also cheaper than today’s silicon solar cells.

    Perovskites and the Hopes to Improve Solar Energy Efficiency

    The perovskites the solar industry is interested in are “lab-made” rather than mined from the Earth. These synthetic perovskites are made from a mix of organic compounds, metals, and halides (reactive elements). Thanks to their unique structure and chemical composition, they’re great at absorbing sunlight.

    By adding perovskites (which can be applied to any flexible surface using a special ink) to traditional silicon cells, the sensitivity of solar panels’ to different parts of the solar radiation spectrum increases. As such, efficiency can be boosted further to overcome the theoretical power conversion efficiency limit of 33%, Wayne Hicks and Don Gwinner from NREL tell.

    In fact, Oxford PV, a U.K. company developing solar cells that uses perovskite, announced in December they had reached a (record) 28% conversion efficiency for its tandem perovskite-based solar cell. over, as said in the video above, the mass production of perovskite cells seems to be potentially cheaper and less harmful than producing silicon.

    In the end, solar panels are an amazing technology and a great alternative to fossil fuels, but we need to work out how to make them more efficient. Research on alternative designs for more efficient and less expensive solar cells is likely to continue and other alternatives to silicon are expected to show up.

    What Is Solar Offset?

    One of the biggest reasons most people install solar panels on their homes is to save money. Solar offset measures the amount of energy you produce, compared to the amount of energy you consume. You might assume that offsetting 100% of your energy needs with solar power is the way to maximize your savings, but it’s more complicated than that.

    When you use electricity from your solar energy system instead of the electric grid, you cut down on your monthly electricity bill from the utility. However, there are times when you produce more electricity than you need. There are other times when the amount of energy your solar panels create is less than the amount of energy you currently need to use. When measured over a year, these competing amounts of electricity from both your solar panels and the grid introduces a concept called solar offset.

    This article will explain what solar offset means, how to calculate it for yourself, what the ideal solar offset is, and how to use the concept to lower your monthly energy expenses.

    Solar Offset Definition

    Solar offset is a measurement of the yearly difference between the amount of electricity generated by your solar panels, and the amount of electricity your home uses. It’s typically expressed as a percentage.

    In a perfect scenario, your home would use the same amount of electricity as your solar panels generate, but realistically, it’s never going to be exactly 100%. However, you can still design a system that gets as close to 100% as possible, based on your historic energy consumption habits.

    Consider this more likely scenario:

    • For some months (usually in the winter), your home uses more electricity than your solar panels generate. This means you have to draw power from the electric grid.
    • In other months (usually in the summer), you generate excess solar energy that your home can’t use. You can either send that electricity back to the electric grid or store it in solar batteries.

    Thus, solar offset is a way to measure this imbalance so you can have a better idea of what your electricity production and consumption might be.

    How to Calculate Solar Energy Offset

    The basic equation is simple:

    Amount of Yearly Solar Electricity Generated in Kilowatt-Hours (kWh) / Amount of Yearly Electricity Consumed in Kilowatt-Hours (kWh) = Solar Energy Offset.

    Once you do this calculation, you can convert the answer into a percentage by multiplying it by 100. For example: 1 = 100%.5 = 50%, and 1.5 = 150%

    Stated another way, the “perfect” solar energy offset is 1, or 100%. As in, your home used the same amount of electricity over a year as your solar panels generated.

    • Your solar panels generated 9,420 kilowatt-hours (kWh) of electricity in a year.
    • Your home used 8,640 kWh in a year.
    • 9,420 kWh / 8,640 kWh = A solar offset of 1.090, or 109%.

    It’s easy to do those calculations with historical information. If you already have solar panels installed, you know how much electricity usage your home used and how much electricity your solar panels generated. The tricky part comes when you don’t have solar panels on your roof and want to predict how many solar panels you need to install to achieve a desired solar offset.

    How Much Solar Power Offset Do I Need?

    Homeowners often want to install enough solar panels to lower their utility bills as much as possible. You might think that by designing a solar power system with a solar power offset of 100%, you could eliminate your electric bill from the utility (aside from charges like fixed fees that you will always pay to remain connected to the grid).

    However, because of the way that net metering works in many areas, offset solar of 100% could still mean that you owe the utility for some of the power that you used. Because solar offset measures the balance of production and consumption over a year, it doesn’t take into account the amount you pay for power from the utility or the amount of credit you get for net metering.

    To simplify this explanation, imagine that you need 20 units of electricity each month, and there are only 2 seasons: winter and summer.

    In the summer months, sunny days mean that your solar panels generate 30 units of electricity. Since you only need 20 units, you can give the extra 10 units back to the grid and get credit for them. However, the grid might only credit you at a 50% rate, so the 10 units you give back earn you only 5 credits.

    In the winter months, the darker days mean that your solar panels only generate 10 units of electricity. You have 5 credits per month from the summer, and you generate 10 units (for a total of 15 units) but you still need 20 units. Therefore, you still have to buy 5 units from the utility.

    Your solar offset is 100% because you consumed 240 units (12 months x 20 units) and you produced 240 units ((6 months x 10 units) (6 months x 30 units)). However, you still had to buy 30 units from the utility (6 months x 5 units) to meet your needs.

    As a result, we sometimes recommend a solar offset that is more than 100% to maximize savings. In some cases, we may recommend a solar offset that is less than 100% because this will allow you to save more money overall. It all depends on the cost of solar, the net metering policy of your local utility company, and other factors.

    Factors That Impact Solar Panel Offset

    When estimating solar panel offset, it can be difficult to predict an exact percentage, because you are using historical data and assumptions about the future. These estimates can be impacted by a variety of factors:

    • Roof Size: The size of your roof can limit the number of panels that can be installed.
    • Solar Seasonality: The amount of sunlight your roof receives during the year can limit how much electricity your panels can generate.
    • Utility Regulations: Utilities can restrict the amount of offset a system is designed to provide.
    • Battery Storage: If you can save your excess solar generation from the daytime, you can use that electricity at night when your solar panels aren’t producing power, which changes how you use net metering.

    It can also be difficult to achieve a desired solar offset, depending on how much energy you use and how much you can potentially produce. Let’s examine these factors in closer detail:

    Roof Size and Type

    If you have a home with a flat roof, you likely have less space for solar panels than a home with a pitched roof that has more surface area for installing more solar panels at the optimum angle.

    If your roof doesn’t have enough space for the solar panels you’d need to reach your desired solar offset, you may need to pursue other options like solar batteries in hopes of storing your excess power generation.

    Amount of Sunlight and Seasonality

    Your solar panels won’t provide energy for you at night or on a cloudy day. As the seasons change, the amount of sunlight your panels receive will change as well. As a result, the weather can either limit or boost the amount of electricity your solar panels can produce. That change depends on where you live and can have an impact on your yearly solar offset.

    Utility Company Regulations

    The maximum offset of your solar energy system could be restricted by your local utility company. Each utility company has a different set of rules for what will work safely on their network. Unfortunately, you don’t have many options if your utility provider doesn’t let you achieve your desired solar offset.

    Power Storage Options

    Unless you turn off your entire home, you will still use energy at night, and solar panels don’t create electricity in the dark. You can use net metering credits to cover that energy usage, but as we discussed, the net metering policy of your local utility company could mean that the credits don’t cover all of your expected needs.

    Another option is storing your excess power because you get almost a 1-to-1 rate of power in to power out. (There is some loss from the system, but it’s minimal.) The amount of power storage you need depends on your solar offset: The lower the offset, the more energy storage you’ll need to cover the difference.

    Energy Consumption Habits

    Your household electricity usage changes based on things like climate, weather, use of appliances and lights, and the time of day. While you can’t control how much electricity your panels generate, you can control how much you use, so limiting your energy consumption can make it easier for your electricity production to cover your needs.

    Solar Offset Is an Important Design Decision

    It’s essential to consider solar offset when planning and designing your solar installation. Depending on things like your net metering rate and future energy needs, you may maximize your overall savings by having a solar offset that’s more than 100%, and sometimes you might even be better off with a solar offset of less than 100%.

    You want your solar panels to take care of a majority of your home’s energy usage, but even with 100% solar offset, you might still have to buy electricity from the utility company. Depending upon certain factors, you might be able to install a system that fully meets your energy needs. You also might need add-ons like energy storage to power your home at night when solar panels don’t create electricity to maximize your savings.

    Achieving the correct offset for solar requires a careful combination of solar system size, net metering considerations, battery storage, and other factors. It also requires homeowners to control their usage carefully through energy-efficient habits and behaviors, Smart appliances, efficient lighting, and other means.

    If you’re ready to install solar panels to help offset your energy costs and switch to clean, renewable energy, you can get started with our Free Solar Design and Savings Estimate Tool to see how much you can save by going solar.

    What Is Solar Panel Efficiency? Definition and Importance

    David Kuchta, Ph.D. has 10 years of experience in gardening and has read widely in environmental history and the energy transition. An environmental activist since the 1970s, he is also a historian, author, gardener, and educator.

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    In a single hour, the sun provides enough energy to fuel human civilization for an entire year. Solar panels can only capture at most a quarter of the sun’s energy hitting them and convert it into electricity—a great improvement since the first photovoltaic cell was created in 1839—but research is ongoing to increase the efficiency of solar electricity and accelerate the transition to clean, renewable power.

    There are many factors that go into creating an efficient solar panel, so knowing what to look for can help you save money on an installation and help you maintain their efficiency over time. Keep in mind, however, that the actual hardware in a solar system is only about one-third (35%) of the total cost of a rooftop solar system. The rest is “soft costs” such as labor, permitting, and design. So while solar panel efficiency is important, it’s only one element in a larger package.

    Why Efficiency Matters

    If you have unlimited space and are ground-mounting solar panels in a field or empty lot, efficiency matters less than if you are installing them on a roof, where getting the most out of limited space is important. Higher efficiency reduces the overall cost of a solar system and decreases the time it takes solar owners to recoup their installation costs. The environmental impact of producing solar panels is also reduced, as panels with higher efficiency can more quickly repay the energy used to produce the panels in the first place, and fewer, more efficient, panels need to be produced to generate the same amount of electricity.

    Which Factors Determine Solar Panel Efficiency?

    Solar cells convert photons (packets of energy) from the sun into currents of electrons, measured in volts, thus the term photovoltaic (PV). PV cells commonly used in solar panels are made from silicon crystals, though other elements (such as selenium and germanium) also have photovoltaic properties. Finding the most efficient element or combination of elements in the right crystalline structure determines how efficient solar panels can be, but other factors are involved as well.


    Untreated, 30% or more of the photons that strike a PV cell will be reflected back as light. Minimizing reflection involves coating and texturing PV cells to absorb rather than reflect light, which is why solar panels are dark in color.


    The solar radiation that reaches Earth includes most of the electromagnetic spectrum, from X-rays to radio waves, with about half of that radiation coming in the Band from ultraviolet to infrared. As the wavelengths get shorter, the energy of the photons increases, which is why the color blue has more energy than red. Designing PV cells involves taking into account these different wavelengths to maximize the efficiency of generating electricity from photons with different wavelengths and different levels of energy.


    Recombination is the opposite of generation. When photons from the sun are absorbed by a PV cell, the photons excite the electrons in the crystals and make them jump to a conductive material, generating a current of “free electrons” (electricity). But if an electron’s energy is weak, it recombines with the “hole” left behind by another electron and never leaves the silicon crystal. Instead, it releases heat or light rather than generating a current.

    Recombination can be caused by defects or impurities in the crystal structure of the PV cell. Yet impurities in the crystal are necessary to move the electrons in a particular direction; otherwise, no current is created. The challenge is to reduce the level of recombination while maintaining an electric current.


    Augusta, Maine receives roughly 4.8 sun-hours per day, slightly less than the 5.0 sun-hours per day received in Augusta, Georgia. Yet PV cells work better at lower temperatures, so panels on a rooftop in Augusta, Maine may be more efficient at producing electricity than those on a rooftop in Augusta, Georgia, even if their daily insolation is lower.

    What Is Insolation?

    Insolation is a measurement of the average solar radiation of an area over a period of time.

    Solar panels are at their maximum efficiency in temperatures between 15°C (59°F) and 35°C (95°F), according to EnergySage, but the panels themselves can rise to 65°C (150°F). Panels will be labeled with a temperature coefficient, which is the rate at which they lose efficiency for every degree above 25°C (77°F ). A panel with a temperature coefficient of.0.50% will lose a half percent efficiency for every degree above 25°C.

    How Are Solar Panels Tested for Efficiency?

    Essentially, testing the efficiency of a solar panel means finding the ratio between the amount of electricity that the solar panel is able to produce and the amount of solar irradiance the panel is exposed to. Here is how that test is conducted:

    Solar panels are tested at 25°C and exposed to 1,000 watts (or 1 kWh) per square meter of solar irradiance—what is known as standard test conditions (STC), then their electricity output is measured.

    A panel’s power output rating (Pmax), measured in watts, is the maximum amount of power a solar panel is designed to produce under STC. A standard residential panel might have an output rating of 275-400 watts.

    As an example: A 2-square meter panel under STC would be exposed to 2,000 watts. If it has a power output rating (Pmax) of 350 watts, it will have an efficiency rating of 17.50%.

    To calculate a panel’s efficiency, then, divide the Pmax by the panel’s solar irradiance, then multiply by 100%. So, 350 / 2000 =.1750, and.1750 x 100 = 17.50%.

    Tips for Maximizing Efficiency

    The most efficient panels may not be the best use of your money. Consider the entire system cost for the panels (separate from “soft costs”). Given the panels’ efficiency, how many watts will they generate over the next 25 years (assuming standard test conditions)? How many watts do you need? Perhaps you are overbuilding, while a less efficient system will supply all your needs at lower cost.

    efficient, solar, panel

    Once you’ve installed a solar system, keep your panels clean. Regular rainfall will do the job, but if you live in a dry climate, use plain water (no soap, which can leave a film) twice a year to remove dust and dirt. Trim back branches if they’re over-hanging your roof, and remove any debris between the panels and your roof, since greater air circulation keeps your panels cooler. If needed, get a solar easement to remove shade from neighboring obstructions.

    Software that comes with a solar system will monitor its output in kilowatt-hours (kWh). If you find output declining over time, all other conditions being equal, have your system tested. An ampmeter and multimeter are needed for these tests: Consult a professional, as you can damage your panels by doing the tests incorrectly.

    Solar’s Future Is Bright

    In June 2021, the maximum efficiency of a solar PV panel on the market was 22.6%, while a number of other manufacturers had cells over 20%. That’s why research is underway to create more efficient combinations of materials that can be commercially viable. Perovskites or organic PV cells may reach commercialization soon, while more inventive methods such as artificial photosynthesis show promise, even if they are still at an early stage of development. Research in the lab has produced PV cells with efficiencies nearing 50%, but bringing that research to market is key to the future of solar technology.

    efficient, solar, panel

    Solar panels designed for home use are typically 15% to 18% efficient. Anything between 18% and 25% would be considered premium.

    Although reports over the years have claimed that solar panels have reached 100% efficiency in testing, no such solar panel is commercially available. Some of the most efficient solar panels currently on the market are just above 20% efficient.

    The efficiency of solar panels seems low because not all the light that hits the panel can be processed as energy due to imperfect glass, lenses, and reflectors; the temperature of the solar panel; and the fact that much of it is not direct sunlight but diffused.

    • How Does Solar Work? U.S. Department of Energy.
    • Most Efficient Solar Panels: Solar Panel Cell Efficiency Explained. EnergySage.
    • Solar Soft Costs. Solar Energy Industries Association.
    • Bhandari, Khagendra P., et. al. “Energy Payback Time (EPBT) and Energy Return on Energy Invested (EROI) of Solar Photovoltaic Systems: A Systematic Review and Meta-Analysis.” Renewable and Sustainable Energy Reviews, vol. 47, 2015, pp. 133-141., doi:10.1016/j.rser.2015.02.057
    • Solar Performance and Efficiency. U.S. Department of Energy.
    • Solar Radiation and Climate Experiment. National Aeronautics and Space Administration.
    • NSRDB Data Viewer. National Renewable Energy Laboratory.
    • How Hot Do Solar Panels Get? Effect of Temperature on Solar Performance. EnergySage.
    • Svarc, Jason. Most Efficient Solar Panels 2021. Clean Energy Reviews, 2021.
    • Photovoltaic Energy Factsheet. University of Michigan Center for Sustainable Systems.

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