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Nature of innovations affecting photovoltaic system costs

Author

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  • Goksin Kavlak
  • Magdalena M Klemun
  • Ajinkya S Kamat
  • Brittany L Smith
  • Robert M Margolis
  • Jessika E Trancik

Abstract

Innovations improve technology costs through various kinds of engineering advancements, including changes to materials choices and device or process designs. Understanding how these innovations relate to cost change can reveal aspects of the process of technology evolution, yet developing such understanding is often not possible with a strictly quantitative approach due to data limitations. In this paper we develop a hybrid quantitative-qualitative framework for relating specific innovations to cost change by using the variables in a quantitative technology cost change model as an organizing principle. We demonstrate this framework by applying it to the cost decline in photovoltaic (PV) systems over the last five decades. This framework generates new understanding of a set of innovations that contributed to PV modules’ sustained cost decline and the more modest trends observed in balance-of-system (BOS) costs. The results show the great diversity of innovations that affected PV costs, drawing on wide-ranging fields of expertise within scientific research and practice. We find that there are differences in the characteristics of innovations that reduced the cost of PV modules compared to innovations influencing BOS costs. Numerous module innovations reduced costs by advancing manufacturing tools and processes that improved material quality. Many BOS innovations reduced costs through a combination of component design changes, integration, automation, digitalization, and standardization. Overall, most innovations in our sample affected PV hardware. However, some also target ‘soft technologies’ such as task durations through innovations like fast-track permitting, which require improved collaboration and process streamlining. This framework also provides insight into the nature of knowledge spillovers between technologies. Both module and BOS hardware innovations show the benefits of PV’s position within an ‘ecosystem’ of continuously advancing technologies in many industries, in particular semiconductors and electronics, and also point to the importance of public institutions for accelerating testing, permitting, and training.

Suggested Citation

  • Goksin Kavlak & Magdalena M Klemun & Ajinkya S Kamat & Brittany L Smith & Robert M Margolis & Jessika E Trancik, 2025. "Nature of innovations affecting photovoltaic system costs," PLOS ONE, Public Library of Science, vol. 20(8), pages 1-26, August.
    • Handle: RePEc:plo:pone00:0320676
    DOI: 10.1371/journal.pone.0320676
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    References listed on IDEAS

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    1. Luís M A Bettencourt & Jessika E Trancik & Jasleen Kaur, 2013. "Determinants of the Pace of Global Innovation in Energy Technologies," PLOS ONE, Public Library of Science, vol. 8(10), pages 1-6, October.
    2. Schmidt-Ehmcke, Jens & Zloczysti, Petra & Braun, Frauke G, 2010. "Innovative Activity in Wind and Solar Technology: Empirical Evidence on Knowledge Spillovers Using Patent Data," CEPR Discussion Papers 7865, C.E.P.R. Discussion Papers.
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