2024 Climate Tech Companies to Watch: First Solar and its advanced solar panels

Today, Chinese firms produce the vast majority of the world’s solar panels. Most build cells that incorporate a layer of silicon to absorb the sun’s light and awaken electrons within, which then flow out as current. Instead of silicon, First Solar’s cells rely on a thin film made from two other elements: cadmium and tellurium. These cells can be produced more quickly than silicon cells, using less energy and water. 

But there’s still room for improvement in the cells’ performance. Today’s best silicon solar panels convert roughly 25% of the sun’s energy into electricity, and cadmium telluride tends to lag behind that. To boost efficiency, First Solar is now looking to incorporate a new class of materials called perovskites into its cells. These tiny crystals absorb different wavelengths of light from those absorbed by silicon or cadmium telluride. Cells that add perovskites to the mix—known as perovskite tandem solar cells—could potentially convert even more of the sun’s energy into electricity. 

First Solar is among a handful of companies exploring how to layer these crystals into commercial solar cells to improve performance. Last year it acquired a firm called Evolar, a leader in thin-film and perovskite research, to further this aim. 

Key indicators

• Industry: Renewable energy 
• Founded: 1999
• Headquarters: Tempe, Arizona, USA
• Notable fact: First Solar’s backlog of orders totals 76 gigawatts and stretches out to 2030.

Potential for impact

Globally, solar energy accounted for more than three times as much new capacity for electricity generation as wind in 2023, according to the International Energy Agency. There are a few reasons why—the price of panels has dropped dramatically in the past 20 years as production ramped up, and they’re relatively easy to install and maintain. 

Solar’s future looks just as bright—global solar capacity is expected to reach nearly 2,000 terawatt-hours this year, and the IEA says we could see it quadruple by the end of the decade. In the US, First Solar’s expanding production and its recent investments into perovskites will shape the solar market for years to come. 

Caveats 

One of the biggest obstacles to bringing more utility-scale solar plants online in the US is hooking these projects up to the grid once they’re built. The federal agency that approves grid interconnections has a backlog of requests. Right now it takes about five years, on average, for a new solar plant to open. Recent reforms aim to make this process faster, but their impact is still unclear. 

Compounding this problem is a shortage of transformers, which step the voltage of electricity up or down; these are crucial to managing the flow of clean energy across the grid. And there are siting challenges, since developers must obtain permits and some community groups oppose large installations. First Solar’s customers are overwhelmingly based in the US and include developers of new solar projects that face all these issues, which could limit the company’s growth.