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Solar Energy 101: A Comprehensive Guide to Understanding Solar Power

The global energy landscape has been undergoing a dramatic change over the last couple of decades, as it gradually shifts towards low-carbon and more sustainable energy sources. This transition has been driven by growing concerns about climate change and the advancement of green technology, which is making low-carbon solutions more affordable and reliable. In particular, renewable energy sources, such as solar energy, wind energy, hydroelectricity, and geothermal energy, have emerged as viable alternatives to traditional fossil fuels for electricity generation and heat. Among these options, solar energy has gained particular prominence due to its abundant availability, cost competitiveness and scalability to meet varied demands.

This article will provide a comprehensive overview of all the basics you need to know about solar energy: what it is, how it is deployed, how it contributes to climate change mitigation and environmental sustainability, the challenges facing the technology and also its future trajectory.

Understanding the basics of solar energy is crucial for promoting sustainable practices and enabling the transition to a clean energy future. This will become increasingly important amid a backdrop of rising global electricity demand, driven by urbanisation, the electrification of transport and increasing industrialisation.

Solar Energy 101: Back To Basics

Solar radiation, an electromagnetic emission emanating from the sun, illuminates the Earth. While sunlight radiates all areas on Earth, the measure of solar radiation that penetrates a specific point on the Earth’s surface is not uniform. Solar technologies capture this radiation and transform it into practical forms of energy. The potential of solar energy is unlimited: the volume of solar radiation that touches the Earth’s surface in just an hour surpasses the total energy consumption of the entire world for an entire year.

Solar technologies harness this power of sunlight, either by utilizing photovoltaic (PV) solar panels or by using mirrors to concentrate solar radiation in a technology known as solar CSP. The harnessed energy can then be utilized to generate electricity, or it can be preserved within batteries or thermal storage systems, primed for future utilization.

Solar PV Basics

Solar PV technology harnesses the photovoltaic effect, a process where light particles called photons hit a material, usually silicon, and energize its electrons. As a result, electrons are set free from their atomic bonds. These released electrons, which carry a negative charge, move to the front of the solar cell. This creates an electrical difference between the cell’s front and back surfaces, similar to a battery’s poles.

Conductors on the cell capture these electrons. When these conductors connect to something like a battery, an electric current starts flowing through the circuit. This flowing current is called direct current (DC) because the electrons move in one direction. Later, inverters change this DC into alternating current (AC), which is the kind of electricity most commonly used in homes and businesses. For an in-depth guide to solar inverters, click here.

At present, photovoltaics is one of the most recognizable methods for capturing solar energy and mainly utilizes three technology panel types: Monocrystalline, Polycrystalline and Thin-Film Solar Panels. You can find out more information on these kinds of panels, here OR learn how solar panels are made here.

solar energy - the inside of a photovoltaic cell

Solar CSP Basics

Unlike solar panels, solar CSP systems employ mirrors or lenses to focus sunlight onto a receiver, where it transforms into heat. This intense sunlight creates high temperatures that make steam. This steam powers a turbine connected to a generator, creating electricity.

CSP setups often include special storage systems to hold thermal energy. This way, they can produce electricity even when the sun is not shining, offering steady and reliable power. Solar CSP is mostly used in big utility plants and suits places with abundant sunlight.

There are two main types of CSP:

Parabolic Trough Systems use long curved mirrors (parabolic troughs) to concentrate sunlight onto a linear receiver tube located at the focal point of the trough. The receiver tube contains a heat transfer fluid that absorbs the concentrated sunlight and heats up.

Solar Power Tower Systems where a field of mirrors is developed that tracks the movement of the sun and reflects sunlight onto a central receiver tower. At the top of the tower, a heat-absorbing material is located, which heats up as it receives the concentrated sunlight.

For more information on the specific mechanics of photovoltaics and CSP technologies and their differences, click here. 

Exploring the Diverse Applications of Solar Energy

Solar power is a versatile renewable energy source that caters to various levels of energy consumption and locations, from residential homes to large-scale utility plants, off-grid rural areas and commercial/industrial establishments.

solar energy applications
  1. Residential Applications: For residential use, solar power provides homeowners with a sustainable and cost-effective way to generate electricity. Rooftop solar panels are commonly installed on residential properties, capturing sunlight and converting it into electricity through photovoltaic cells. This energy can power the home’s appliances, lighting, and other electrical needs. Excess energy generated during sunny periods can be fed back into the grid through net metering, allowing homeowners to earn credits or reduce their utility bills. Battery storage systems are also increasingly integrated with residential solar setups, enabling energy storage for use during non-sunny hours.
  2. Utility-Scale Applications: Utility-scale solar installations involve much larger solar farms with numerous solar panels deployed over often vast land areas. These large-scale solar power plants generate a substantial amount of electricity, feeding it directly into the electrical grid to supply power to thousands of homes and businesses. They can use advanced tracking systems to optimize the panels’ orientation towards the sun for maximum energy capture.
  3. Commercial/Industrial Applications: Solar power is also gaining traction in commercial and industrial sectors. Many businesses and industries are adopting solar energy to lower operating costs, reduce their carbon footprint and adhere to ESG solar goals. Commercial buildings can install solar panels on rooftops, carports, or vacant land to generate their own electricity and potentially achieve energy independence. Industries with substantial energy requirements, such as manufacturing and data centers, can incorporate solar power to offset a portion of their energy consumption, leading to long-term cost savings.
  4. Off-grid and decentralised applications: In off-grid and decentralized scenarios, solar energy is pivotal in delivering electricity to areas beyond the reach of conventional power infrastructure. These applications are vital for providing reliable power to remote and isolated regions where traditional methods are either unfeasible or absent. Off-grid solar systems, commonly combined with battery storage, emerge as dependable sources of electricity for isolated homes, rural communities, telecommunication setups, and essential water pumping stations.

Solar Panels: How Are They Made?

Solar panels comprise several components, including a frame, glass, encapsulant, back sheet, solar cell and junction box. These component parts are all manufactured in different ways and have different roles in the panel, as can be read in detail here.

Arguably the most important element of a panel is the solar cells, which play an instrumental role in the entire solar energy conversion process, by turning the sunlight into usable electricity.

The journey of creating solar panels starts with sand and culminates in the powerful cells that harness the sun’s energy. It begins with the extraction of silicon from sand, a process that involves purifying and crystallizing the material. These silicon wafers are then meticulously cut and treated to form photovoltaic cells, which are the heart of solar panels. Thin layers of conductive materials are applied to facilitate the movement of electrons, and anti-reflective coatings are added to optimize light absorption. The cells are then carefully arranged, often in a grid-like pattern, and encased in protective layers to withstand environmental conditions.

solar energy - how solar panels are made

Solar panels are manufactured within modern and advanced facilities. These facilities house automated robotic machinery and sensors, which work together to ensure the exact positioning of components with the highest level of accuracy. This collaboration between robotics and sensors guarantees the precision and accuracy of each solar panel’s assembly.

The production process and duration of a solar panel depend on several factors, including the panel’s type, the manufacturing technique employed, and the manufacturer’s production capability. Based on our research, a general estimation suggests that producing a standard solar panel takes approximately 2 to 3 days. Within this timeframe, various stages of production unfold, encompassing wafer production, cell fabrication, module assembly, and comprehensive quality testing.

Solar Panels: What Is The Cost?

Installing solar energy systems can vary in cost depending on various factors such as the size of the system, the location of the installation, and the specific needs of the property. Based on our research, generally, the cost of installing a solar energy system ranges from US$15,000 to US$40,000 or more.

The size of the system is one of the primary factors that influence the cost of installation. Larger systems with a higher capacity to generate electricity will typically cost more than smaller systems. The specific energy needs of the property will determine the size of the system required.

The location of the installation also plays a vital role in determining the cost. Factors such as local building codes, permits, and utility interconnection fees can vary from one location to another, potentially impacting the overall cost.

Additionally, the type of solar energy system being installed can affect the cost. There are different types of systems, including grid-tied systems, off-grid systems, and hybrid systems. Each system has its own set of components and installation requirements, which can influence the overall cost.

To determine the precise cost of installing a solar energy system for a specific property, it is recommended to consult with a reputable solar installation company.

The Numerous Benefits Of Solar Energy

From its capacity to significantly reduce carbon emissions and combat climate change to its potential to foster energy independence and stimulate economic growth, the advantages of solar energy are numerous.

Environmental Benefits

By adopting solar power, individuals, communities, and industries contribute to a more sustainable energy future, mitigating the impacts of climate change and promoting environmental stewardship. Solar energy, as a renewable power source, plays a vital role in combating climate change by curbing greenhouse gas emissions. Moreover, solar energy contributes to enhanced air quality, reduced water consumption in energy production and can even play a role in land use conservation.

The most well-documented environmental benefit of solar power is its status as a carbon-free energy source. Unlike conventional fossil fuels, solar energy is both clean and renewable. Solar panels generate electricity or heat without emitting any greenhouse gases into the atmosphere, such as CO2. This characteristic makes solar power, along with other low-carbon energy sources like wind and nuclear power, a potential game-changer in global efforts to combat climate change.

Moreover, by utilising solar panels for electricity generation and heating, individuals, businesses, and policymakers can substantially decrease their reliance on fossil fuels and offset their energy consumption. As the adoption of solar energy grows, the dependence on electricity derived from fossil fuels naturally wanes. This strategic transition results in a concrete reduction of CO2 emissions, making a significant contribution to the global efforts to combat climate change.

The environmental benefits of solar energy - the green house effect

Economic Benefits

Solar energy offers compelling financial benefits across various sectors. Beyond slashing or even eradicating electricity bills, it yields substantial cost savings. While initial installation expenses might be high, solar systems boast minimal operational and upkeep costs. Organizations generating their own renewable energy can mitigate or eliminate electricity costs, elevating long-term fiscal predictability.

Solar investments promise attractive returns on investment (ROI) over their operational life. With advancing technology and falling costs, the payback period for solar installations has notably shortened, ensuring swift recouping of initial investments and yielding favorable returns. For example, according to the International Renewable Energy Agency (IRENA), solar PV has seen the steepest cost decline of any electricity source over the last decade, incentivising the deployment of solar technology globally.

Solar energy significantly bolsters job creation by fostering a vibrant and expanding job market across multiple sectors. The installation and maintenance of solar panels alone necessitate a skilled workforce, from electricians and engineers to project managers. As solar adoption surges, these professionals find steady employment opportunities in designing, setting up, and upkeeping solar systems. Manufacturing solar panels and associated technologies spurs the demand for workers in research, production, and quality control. Moreover, solar’s research and development efforts require scientists and engineers to innovate and enhance technology. Beyond these specialized roles, the solar industry stimulates local economies as projects engage local contractors, suppliers, and services, fostering sustainable economic growth within communities.

Energy Independence Benefits

Solar power empowers both homeowners and businesses to take charge of their energy production, fostering a level of autonomy that not only boosts financial stability but also strengthens energy security. By harnessing the sun’s energy through solar panels, individuals and organizations can significantly curtail their reliance on external energy sources, thereby diminishing vulnerability to supply disruptions and geopolitical fluctuations that can cause energy prices to soar.

Challenges & Limitations Of Solar Energy

While the benefits of adopting solar are clear, there are still several barriers that will hinder adoption over the coming years.


A key obstacle revolves around the initial expense of setting up solar panels and the associated infrastructure. The upfront investment can pose a notable hurdle, particularly for smaller enterprises or developing countries with restricted financial means. Nonetheless, governmental bodies and local authorities frequently offer financial incentives such as tax credits, rebates, feed-in tariffs and grants to encourage the uptake of solar energy, thereby alleviating some of the financial burden.

Technology costs for renewable energy, particularly solar, have fallen dramatically over recent decades, making them an increasingly affordable option for electricity generation. Our research shows that this trend will continue over the coming decade, reducing the barrier of inhibitive costs. For example, by 2030, the global weighted average levelized cost of electricity (LCOE) for solar PV is forecast to fall by 58% from 2018.

Intermittency & Storage Needs

Intermittency presents a significant hurdle within the realm of renewable energy sources. Unlike the dependable and foreseeable electricity supply furnished by fossil fuel-based power generation, numerous renewable sources like solar and wind hinge on variables such as weather patterns and sunlight. Consequently, energy availability from these sources experiences fluctuations, rendering them intermittent and, in some cases, less dependable. These fluctuations can also destabilize the electricity grid, leading to challenges in maintaining a consistent power supply to consumers and businesses. Rapid changes in renewable energy output, caused by factors such as cloud cover or sudden drops in wind speed, can create imbalances between electricity generation and demand. This situation, known as grid instability, poses a risk of power outages and voltage fluctuations.

An efficient remedy for mitigating the intermittency challenges linked to renewable energy lies in energy storage technology, such as Battery Energy Storage Systems (BESS). Systems like batteries and pumped hydro storage are capable of storing surplus energy generated during periods of robust renewable output, subsequently discharging it during times when renewable sources yield less or no energy. By harmonizing the supply and demand of energy, these storage solutions play a pivotal role in steadying the electrical grid and guaranteeing an uninterrupted and dependable power flow, effectively counteracting the fluctuating nature of renewable energy source.

Technical Expertise Required

Technical proficiency and maintenance represent additional hurdles in the path of solar energy adoption. Embracing solar power demands a nuanced understanding of aspects ranging from system design to installation, along with the ongoing upkeep of the systems. The intricacies of these tasks necessitate specialized expertise, which can be a potential roadblock for organizations looking to transition.

To surmount this challenge, businesses might opt to collaborate with the best solar companies, leveraging their expertise to ensure accurate installation and optimized performance. Alternatively, they could choose to invest in training their workforce, equipping employees with the skills needed to proficiently manage maintenance duties. Navigating these aspects effectively is crucial for deriving the maximum benefit from solar energy systems.

The Future Of Solar Energy

Innovations in solar technology will continue to drive the efficiency and performance of solar panels, propelling its expansion over the coming decade. Our research shows that the global solar energy market will grow at a CAGR of 7.2% between 2023 to 2030, with the market size totalling nearly USD350 billion by 2030.

Despite increases in investment costs due to rising commodity prices, utility-scale solar PV is the least costly option for new electricity generation in most countries worldwide. Distributed solar PV, such as rooftop solar on buildings, is also set for faster growth because of higher retail electricity prices and growing policy support. The exceptional growth in PV deployment in recent years will need to continue and scale up to follow the Net Zero Emissions by 2050 Scenario, requiring continued policy ambition.

In addition to cost reductions and climate-driven policies, the future of renewable energy is also intertwined with ongoing research and innovation. Advancements in energy storage technologies, grid management systems, and renewable energy integration are vital to overcoming the intermittency challenges of renewable sources and ensuring a reliable and stable energy supply.

By channelling financial resources into renewable energy projects, governments, businesses, and individuals can drive the global transition to a low-carbon and sustainable energy future. The IEA suggests that to reach net zero emissions by 2050, annual clean energy investment worldwide will need to more than triple by 2030 to around US$4 trillion, aligning with our own assumptions. Investing in the expansion of renewable energy is vital not just for combating climate change, but also for boosting energy security, minimizing air pollution, and establishing a more robust energy infrastructure that will benefit future generations.


This guide has provided practical insights into solar energy, shedding light on its potential to reshape our energy landscape. We’ve covered the basics of solar energy, its functioning, the technology it involves, and the solar panel manufacturing process. The guide has thoroughly discussed the various advantages of solar energy, focusing on its economic, energy independence, and environmental aspects. Furthermore, it has outlined the challenges linked with solar energy and suggested ways to overcome them.

Armed with this knowledge, there’s a clear call to action for individuals, businesses, and governments to invest in solar power. By adopting solar energy, we actively contribute to a cleaner planet and better well-being, all while ensuring a dependable energy source and resilience for both our current and upcoming generations.

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