An In-Depth Analysis of the Solar Energy Market Dynamics

This report provides a comprehensive analysis of the solar energy market. It begins with a market description, exploring the evolution of solar energy technologies, including both CSP and PV systems, and highlights the significant cost reductions over the past few decades, driven by regulatory changes and environmental concerns. The report then delves into production processes, detailing the purification of silicon, the creation of single-crystal silicon, wafer manufacturing, doping, and the placement of electrical contacts, along with anti-reflective coatings and encapsulation. It analyzes both fixed and variable costs associated with solar panels, including inputs and the cost function, and the factors influencing solar panel output. The report further examines market analysis, identifying various consumer types such as investment-focused consumers, independent users, environmentalists, technologists, and solar enthusiasts. Constraints and regulations, including environmental costs, raw material considerations, aesthetics, and design, are discussed. The report also presents the solar payback formula and highlights interesting market facts, such as the significant decrease in solar panel costs since 1977 and the increasing cost-competitiveness of solar energy compared to fossil fuels. Finally, it investigates solar energy's elasticity and potential substitutes like hydroelectric, geothermal, wind, and biomass systems.

Table of Contents
1 Solar Market Description: .......................................................................................................
4
2 Preferences and production: ....................................................................................................
5
2.1 Solar Elastic: ....................................................................................................................
5
2.2 Substitute of solar panels Green-Energy Alternatives to Solar Panels for Home Use .... 5
2.2.1 Hydroelectric Systems ..............................................................................................
5
2.2.2 Geothermal Systems .................................................................................................
5
2.2.3 Wind Power Systems ................................................................................................
6
2.2.4 Biomass Systems ......................................................................................................
6
2.2.5 Solar Alternatives...................................................................................................... 7
2.3 Production Process ...........................................................................................................
7
2.3.1 Purifying the silicon ..................................................................................................
7
2.3.2 Making single crystal silicon ....................................................................................
7
2.3.3 Making silicon wafers ...............................................................................................
8
2.3.4 Doping....................................................................................................................... 8
2.3.5 Placing electrical contacts .........................................................................................
8
2.3.6 The anti-reflective coating ........................................................................................
9

2.3.7 Encapsulating the cell ...............................................................................................
9
2.4 Quality Control .................................................................................................................
9
2.4.1 Fixed & Variable Costs ...........................................................................................
10
2.5 Solar panel inputs: ..........................................................................................................
10
2.5.1 The solar panel cost function ..................................................................................
10
2.6 The rule for solar panel ..................................................................................................
11
3 Market Analysis .....................................................................................................................
11
3.1 Consumer type................................................................................................................ 11
3.1.1 The Investment Consumer ......................................................................................
11
3.1.2 The Independent...................................................................................................... 11
3.1.3 The Environmentalist ..............................................................................................
12
3.1.4 The Technologist ....................................................................................................
12
3.1.5 The Solar Enthusiast ...............................................................................................
12
3.2 Constraints and regulations in Solar: .............................................................................
12
3.2.1 Environmental costs ................................................................................................
13
3.2.2 Raw material and waste products ...........................................................................
13

3.2.3 Aesthetics and design ..............................................................................................
13
3.3 Regulations: ....................................................................................................................
13
3.4 Payback period (equilibrium outcome) ..........................................................................
14
3.4.1 Solar Payback Formula ...........................................................................................
15
3.5 Interesting about the market: ..........................................................................................
15
3.5.1 Solar panel costs have fallen 99% since 1977 ........................................................
15
3.5.2 Solar Energy is cheaper than fossil fuels ................................................................
15
3.5.3 Solar power plants can last 40 years or more .........................................................
15
3.5.4 China is the world leader in solar energy ... by a lot............................................... 16
4 References .............................................................................................................................
17
1 Solar Market Description:
Solar energy has come a long way in the previous decade. Solar CSP and grid-connected PV are two
of today's solar technologies. It has gotten a lot cheaper in the last 30 years. The cost of a PV system

has similarly decreased, from $16,000 per kW in 1992 to roughly $6,000 in 2008. Solar buzz 2006;
2007). Solar energy's rapid growth has been spurred in recent years by regulators, shifting fossil fuel
prices, and environmental concerns.
In theory, solar energy can meet all the world's energy needs (Kurosawa et al. 2007; EPIA, 2007).
Despite recent industrial progress and technological potential, solar energy's worldwide contribution
remains minimal (IEA, 2009). This research investigates why solar energy is so underutilized around
the world. Is it difficult to integrate solar electricity into national power grids? What policies
encourage the use of solar energy? Are these policies effective? If this is the case, new policy tools
are required.
Arvizu et al. conducted a large-scale solar energy investigation (2011). Using available statistics and
economic analysis, this study compares solar energy to fossil fuels. Despite falling costs, we
discovered that solar electricity is still not cost-competitive. Fracking has serious environmental
consequences, but it hasn't helped the economy. Several technological, economic, and institutional
impediments to extensive solar energy deployment exist. These barriers have been overcome through
financial incentives such as tax credits and capital subsidies, as well as RPS. The fit was crucial in
three of the four circumstances.
Several federal policies have assisted the expansion of the solar energy business in the United States
(REC). The Kyoto Protocol's Clean Development Mechanism (CDM) promotes solar energy, but its
impact is limited by cost. According to our study, solar energy might account for about 10% of global
energy generation by 2050. Even if the carbon intensity of the global energy system were reduced by
around 75%, this would still be a minor component of the overall energy supply and renewable
energy output.
2 Preferences and production:
Environmental knowledge affects green purchasing decisions. The use of energy-saving and
renewable energy technology in the home can have a significant impact on reducing electricity
related emissions in the United States. Because of low-cost solar energy generation and the
potential for the future price decrease, demand for photovoltaic panels will grow. Solar

photovoltaic panels, according to Brayer et al., will be the most important power technology,
followed by wind and hydroelectric. Consumer behaviour and perspectives have changed because
of climate change and public policies pushing renewable energy production.
2.1 Solar Elastic:
Elasticity measures a variable's sensitivity to change. It adjusts consumer and producer demand
and supply in response to price fluctuations. It calculates how much price changes affect
demand.
Supply is flexible because solar panels are cheap and easy to manufacture. Solar panel output
fluctuates with solar energy prices. Because it is modular, you may install as little or as much
solar electricity as you like, making it a variable cost. Thus, a 1% increase in solar electricity
prices increases supply by 2.7%, resulting in a 2.7% supply elasticity.
2.2 Substitute of solar panels Green-Energy Alternatives to Solar Panels for Home
Use
2.2.1 Hydroelectric Systems
Micro-hydroelectric systems are suitable for people with access to running water. A micro
hydroelectric system can be powered by your local river. One is hydro. A micro-hydro system
requires a waterwheel, turbine, or pump. Hydropower is reliable when there is water. Unlike
solar, it is cheap and simple.
2.2.2 Geothermal Systems
Geothermal energy systems use the earth's internal heat. Geothermal loops and pumps That's not
everything. Heat exchangers work in all climates. It's a great method to save money, reduce
carbon emissions, and ensure electricity availability. And it's green.

2.2.3 Wind Power Systems
Consider wind turbines when shopping for solar panels. Need large open areas. With modern
technology, you may install a garden wind turbine. Wind turbines need a continuous breeze to
work. Better than solar panels in windy areas. Although beneficial, some wind turbines are noisy.
2.2.4 Biomass Systems
Biomass (wood, garbage, plants, etc.) can power or heat homes. It's a cheap, low-carbon energy
source. Biomass can be used to cook or heat a home. While wood is the most common, others
exist. Biomass energy systems are advantageous since they reduce landfill trash and are easily
available.

2.2.5 Solar Alternatives
If you want to harness the power of the sun but don't want to invest in a solar panel system, you
have numerous possibilities. You can use solar lights during the day and sun tunnels or solar tube
lights at night. Consider utilizing a solar oven in the mornings and afternoons. Solar-powered
water heaters and air conditioners. Consider solar shingles, which are similar but not identical to
solar panels(Natural power save, 2021).
2.3 Production Process
2.3.1 Purifying the silicon
Crushed quartz in an arc furnace is silicon dioxide. A carbon arc releases the oxygen. Carbon
dioxide (CO2) is a by-product of combustion. 1 percent silicon impurity is advantageous in the
production of solar cells. In a floating zone, silicon is 99.9 percent pure. An impure silicon rod is
continuously passed through a heated zone. Pollution "drags" along with each passing vehicle.
Pure silicon has all the impurities eliminated from it.
2.3.2 Making single crystal silicon
Solar cells have only one crystal structure and are manufactured of polycrystalline silicon boules.
In practice, the Kochanski procedure is preferred. Meld polycrystalline silicon dunks a seed
silicon crystal A silicon "boule" made from a seed crystal. Contaminants in the fluids cause this.

2.3.3 Making silicon wafers
An inner diameter circular saw or a multiwire saw is used to cut silicon wafers from the boule.
(A diamond saw makes 5 mm wide slices.) A round wafer loses almost half of its silicon. Due to
their ability to correctly fit together, rectangular, or hexagonal wafers are sometimes utilized in
solar cells. 5 Wafers are polished and ready. In some cases, coarser cells absorb light better than
polished wafers.
2.3.4 Doping
The Kochanski procedure (step #3) is used to dope silicon wafers with boron and phosphorus.
The wafers are then encapsulated and heated with phosphorous gas to slightly below the silicon
melting point (1,410°C). The phosphorous atoms "burrow" into the porous silicon. This is
achieved by carefully controlling the process temperature and timing. This strategy is more
recent. The ions' speed can affect their penetration depth. Producers on the commercial side have
mainly rejected this novel approach
2.3.5 Placing electrical contacts
Contacts connect solar cells with the gadget that accepts the generated current. They must be thin
to let light into the cell (at least in the front). The metal is vaporized through a photoresist or by
simply depositing it on the exposed section of wax-coated cells. All three approaches protect the
unwanted contact zone while exposing the rest of the cell.

This image depicts a solar cell. Ethylene-Vinyl Acetate cells are enclosed in metal frames with mylar back sheets
and glass coverings (EVA).
Then tiny strips (fingers) are put between cells. Tin-coated copper strips are the most frequent.
2.3.6 The anti-reflective coating
Pure silicon may reflect up to 35% of solar light. The silicon wafer is anti-reflective coated to
prevent light loss. Other coatings beyond titanium dioxide and silicon oxide are employed.
Coating material can be applied on silicon by sputtering or heating. A high voltage ejects
molecules, which land on the silicon electrode on the other side. Oxygen or nitrogen can form
silicon dioxide or nitride. Solar cells use sodium nitride (Sn).
2.3.7 Encapsulating the cell
Silicon rubber or EVA is then applied to the completed solar cells. Mylar or Telaar back sheet
with a glass or plastic cover on an aluminium frame.
2.4 Quality Control
Inconsistencies in many techniques and ingredients might reduce solar cell efficiency. The
purpose of the study is to prolong solar cell life. The Low-Cost Solar Array Project (the late
1970s) aimed to lower solar cell costs. Simultaneous testing of silicon purity, crystal orientation,
and resistivity. Along with oxygen and carbon, manufacturers test for these components that
affect the strength and warping resistance (which causes defects). Finished silicon discs are
examined for sawing, polishing, and etching damage. Temperature, pressure, speed, and dopant
levels are carefully monitored during silicon disc production. These methods also clean the air
and surfaces.
Before using finished semiconductors in devices, they must be tested for conductivity. When
partially shadowed, solar cells tended to fail. Shunt diodes reduce dangerous cell voltages. So,
test shunt resistance at partial shading junctions. They must be exposed to the same conditions
and light intensity as they would be in daily use. It is subjected to extremes of temperature as
well as humidity. After production, solar modules are field-tested. The most crucial requirement
for researchers is solar cell efficiency and longevity(made how, 2021).

2.4.1 Fixed & Variable Costs
In addition to solar panels, rooftop solar electric systems require mounting racks, wire & conduit,
and grounding. An inverter also converts DC to AC grid power. The average inverter lasts ten
years, but most makers and sellers cannot guarantee it. This estimate is conservative and includes
a one-time replacement in the net installation cost.
The solar array should endure 25 years due to the 25-year solar panel warranty and the endurance
of other system components like racking, wiring, conduit, and grounding. Semi-conductive
material failure reduces solar panel power output by 0.5 percent every year. This is a factor in the
study(Stankevich, 2013).
2.5 Solar panel inputs:
Solar panels can boost current in series or parallel. It is rated at 17.0 Volts. Regulators limit it to
13-15 Volta solar cell's temperature impacts its output. Temperature rating: 25°C. The output of
a conventional solar panel changes by 2.5% every 5 degrees. Heat reduces productivity. When
it's chilly and sunny, the sun's beams can outperform solar panels. Consider this when sizing
your solar regulator.
Solar panel production function:
Solar panels utilize the sun's energy to generate power for various uses (street lighting, heating
systems, machine installations, charging of phones, cameras, signage, and many other energy
driven devices). Battery or straight to the power grid are two options. The amount of sunshine
hitting the solar panels' surface boosts power generation. Solar panels require direct sunshine to
perform properly. They can be inclined upwards or downwards. Usually done on roofs or
streetlights.
Solar panels provide electricity that can be utilized to power connected devices. It converts DC
from solar cells into AC for use in equipment and applications that need AC (AC). If you don't
have solar batteries, a battery bank will work. Without solar panels, the battery electricity can be
used for solar street lighting at night.
2.5.1 The solar panel cost function
The rising cost of electricity makes solar power a no-brainer for many homeowners. There are a
few things to keep in mind while installing solar panels to save money. The Center for

Sustainable Energy estimates that the system will cost between $15,000 and $25,000 to install.
The customer's location substantially influences the cost of electricity. The national average for
2021 is 13 cents per kilowatt-hour, according to the EIA. Before taking the necessary risk, learn
how your electric bill, location, and incentives may affect your pocketbook over time. Here are
six steps to determine if solar panels are worthwhile(Schwan, 2021).
2.6 The rule for solar panel
To get solar installed, homeowners should have:
• Energy Information to Size the Solar
• A Place to Put the Solar Panels
• An Electric Panel with Sufficient Capacity
• A Way to Connect the Solar
• A Roof in Good Condition
• A Way to Pay for the Solar
3 Market Analysis
Since 2000, the solar panel industry has changed dramatically. In the last eight years, more
homes, businesses, utilities, and governments have switched to solar energy. The possibility for
small businesses to enter the solar panel market is growing.
3.1 Consumer type
3.1.1 The Investment Consumer
The investor's purpose is to maximize the financial return on his or her investment. This must be
equalled by investments in stocks, other financial goods, and property value. Solar typically
delivers a 6.5-8% return on investment. Every watt of solar electricity added increases the value
of your home by $3.11. The fundamental issue of an investor is whether solar panels will pay for
themselves within an acceptable time frame. They are just concerned with how much money they
can save by adopting the system.
3.1.2 The Independent
They value autonomy over saving money or eliminating pollution. That doesn't mean they want anyone or
anything else to influence or rule her. they do not wish to deal with a utility company or business. She

strives for total self-sufficiency in all areas. they will take advantage of any opportunity to generate their
electricity at a profit.
3.1.3 The Environmentalist
Environmentalists value environmentalism and protecting our planet. They recognize the need
for a zero-emission system. She cares that solar panels are replacing fossil fuels. Furthermore,
they recognize that going solar is the most effective way to reduce their carbon footprint. The
environmental impact of solar electricity surpasses the economic benefits.
3.1.4 The Technologist
The technologist is a computer whiz, tech expert, and gadget freak. They among the first 5% to
adopt new technology. They are willing to pay a premium for the latest technology. In terms of
payback, they also searching for the most efficient panels with a long-term outlook. The
technologist will likely go for SunPower or LG panels due to their superior efficiency and longer
warranties.
3.1.5 The Solar Enthusiast
This is not your average renewable energy consultant. She knows everything about solar
products, installations, and the latest industry news. That she knows the difference between a
charge controller and an optimizer is a given. Our NABCEP professionals can design a solar
system better than a solar enthusiast. She is a big fan of solar(yellow lite, 2016).
3.2 Constraints and regulations in Solar:
The biggest threat to solar energy currently is inexpensive fossil fuels (Rupees per Kwahu).
Energy from coal is cheaper than solar. Regulators and industry are working together to lower
solar cell production costs Though cheaper than coal; solar photovoltaic technology is still not
appropriate for large-scale power generation. On the other hand, solar thermal and photovoltaic
electricity generation costs between Rs. 10 - 15 in India. This method is four to five times more
expensive. This requires new technology.
To reduce costs, the production process must be more efficient. Companies spend on R&D to
stimulate creativity. It's challenging for new enterprises to compete in a new and untested
industry.