Aurora Solar Blog
Aurora Solar Blog

Solar design tips, sales advice, and industry insights from the premiere solar design software platform


Our Newsletter

Subscribe to our updates and never miss out on new features or industry insights.

Aurora Solar Blog

How a Photovoltaic System Produces Electricity

Christian BrownChristian Brown

How a Photovoltaic System Operates

As described in The Beginner's Guide to Solar Energy, solar panels convert the energy of photons into electricity. This process is called the photovoltaic effect.

When a photon hits a photovoltaic device, its energy is transferred from the photon to the local electrons in the material. These excited electrons begin to flow, producing an electric current.

Solar cells produce direct current (DC) electricity, which is typically converted to alternating current (AC) electricity by an inverter, to deliver energy to the grid (which operates with AC electricity).

Components of a Photovoltaic System

A simple PV system contains two basic types of components:

Diagram of a simple PV system Figure 2. Diagram of a simple PV system. Source: Aurora Solar

It is common practice to refer to all components of a PV system besides the modules as balance of system (BOS) components. Examples of BOS components include inverters, disconnects, racking, and wiring.

Factors Affecting Solar Photovoltaic System Efficiency

It is important to note that the process of producing electricity from solar energy is not 100% efficient. Environmental factors, as well as losses in the electrical components, can affect the efficiency of a PV system. Typical loss categories include:

Soiling on PV modules Figure 3. Soiling, such as dust, on PV modules reduces power output. Source: Ferretti and Berghold, PV Tech Power

Term Typical Value
Temperature -0.5%/°C above 25°C
Inverter Efficiency 96.5%
Mismatch 98%
Wiring/Connections 98%
Soiling 95% (highly variable)
Age -0.5%/year
Shading Highly environment dependent
Table 1. Typical efficiency values.

The above factors are combined in a coefficient called the system derate factor to represent the overall losses of a solar installation. For instance, PVWatts, an NREL supported PV system energy production calculator, uses a default system derate factor of 86%. However, depending on the system design or environmental conditions, this value can be higher or lower.

Module efficiency denotes what portion of irradiance a module converts into electricity under standard test conditions (STC; irradiance of 1000W/m2, ambient temperature of 25°C). As a general rule of thumb, you can estimate a PV system’s efficiency in converting irradiance into electricity (under STC) using the following formula:

$$\text{Overall System Efficiency} = \text{Module Efficiency} \times \text{Derate Factor}$$

It is important to note that these are merely back-of-the-envelope calculations. To get an energy production analysis, you need a software application, such as Aurora, that incorporates all of a PV system’s environmental, mechanical, and electrical characteristics.

About Solar PV Education 101

How a Photovoltaic System Produces Electricity is part of Solar PV Education 101, a five-article series introductory primer to the fundamentals of solar PV for beginners.

Article 1: The Beginner's Guide to Solar Energy
Article 2: How a Photovoltaic System Produces Electricity
Article 3: How to Size a PV System from an Electricity Bill
Article 4: Shading Losses for PV Systems, and Techniques to Mitigate Them
Article 5: The Basic Principles that Guide PV System Costs