The short answer? Photons knock electrons loose, and a built-in electric field pushes them around an external circuit. The long answer involves quantum mechanics, band theory, and a few numbers that explain why silicon dominates the market and why single-junction efficiency caps at 33.7%. This is the under-the-hood version of what happens when sunlight hits your roof. We covered the basics in our how solar panels work guide. Here we go deeper.
TL;DR: Photons with energy above silicon's 1.12 eV bandgap (wavelengths shorter than 1,100 nm) excite electrons from the valence band to the conduction band, creating electron-hole pairs in the silicon lattice. The P-N junction has a built-in electric field of about 0.6-0.7V across a depletion zone roughly 0.5-2 micrometers wide. This field separates the electron-hole pairs before they recombine: electrons drift to the N-side and holes to the P-side, generating DC current through any external circuit. A typical cell produces 0.55-0.65V at maximum power point and 9-11A short-circuit current under STC (1,000 W/m2 irradiance, 25 deg C). Stringing 60-72 cells in series gives a panel ~36-42V Vmp and 8-11A Imp, around 400W rated output. The inverter's Maximum Power Point Tracker (MPPT) continuously adjusts operating voltage to land on the V-I curve's power peak as temperature and irradiance change. Shockley-Queisser detailed balance analysis caps single-junction silicon at 33.7% theoretical efficiency; production panels hit 22-23% as of 2026. For the broader process from panel to outlet, see our how solar panels work guide.
When I started learning photovoltaics, I expected the physics to be the hard part. It's the easy part. The hard part is grasping how dozens of secondary effects (surface recombination, contact resistance, spectral mismatch, temperature coefficients) drag the theoretical 33.7% efficiency down to 22-23% in production. Each loss has a specific cause and a specific fix, and the industry has spent 70 years chiseling them away one at a time.
What Energy Does a Photon Need to Generate Electricity?
For silicon, a photon needs energy above 1.12 eV (the bandgap) to lift an electron from the valence band into the conduction band. Photons below that threshold pass straight through, useless for power. Photons above it are absorbed, but any excess energy beyond 1.12 eV converts to heat instead of electricity, a loss called thermalization.
The 1.12 eV bandgap corresponds to about 1,100 nanometres, at the edge of visible light and near-infrared:
- UV light (200-400 nm, ~3-6 eV): absorbed, but loses most energy to thermalization
- Visible light (400-700 nm, ~1.8-3.1 eV): absorbed efficiently, moderate thermalization loss
- Near-infrared (700-1,100 nm, ~1.1-1.8 eV): absorbed well, minimal thermalization
- Above 1,100 nm: passes through silicon without absorbing
Why silicon? The solar spectrum at Earth's surface (AM 1.5G reference) peaks in the visible band around 500 nm, with real intensity through the near-infrared out to about 2,500 nm. Silicon captures the high-intensity portion well but misses the long-wavelength infrared. The Shockley-Queisser detailed balance analysis (1961) puts the optimal single-junction bandgap around 1.34 eV. Gallium arsenide (1.42 eV) sits closer, reaching a 27% theoretical limit versus silicon's 33.7%. Silicon won anyway on economics: abundant, well-understood, and endlessly scalable, while GaAs is rarer and harder to grow defect-free.
How Does the P-N Junction Separate Electron-Hole Pairs?
The P-N junction is the boundary between two silicon regions doped differently: phosphorus for N-type (extra electrons) and boron for P-type (holes). That doping creates a permanent electric field, and that field is the whole mechanism for turning absorbed photons into directional current.
What happens physically:
- Electrons from the N-side diffuse into the P-side, and holes from the P-side diffuse into the N-side (net flow from high to low concentration)
- This leaves behind fixed ionized dopant atoms: positive phosphorus ions on the N-side, negative boron ions on the P-side
- The exposed ions create a field pointing N-side to P-side, the "built-in field" of about 0.6-0.7V across roughly 0.5-2 micrometers
That region is the depletion zone, typically 0.5-2 micrometers thick depending on doping. When a photon is absorbed inside or near it, the field splits the electron-hole pair: the electron accelerates toward the N-side, the hole toward the P-side. Further out, pairs can recombine before reaching the field, which is why the depletion zone and its surrounding minority carrier diffusion length set cell performance.
For mono-crystalline silicon, that diffusion length runs 100-300 micrometers, much longer than typical cell thickness (180 micrometers), so most absorbed photons produce useful current. Polycrystalline silicon has grain boundaries that act as recombination sites, cutting effective diffusion length to 50-150 micrometers and trimming efficiency. Honestly, everything else in cell design (texturing, anti-reflective coating, metallization) exists just to deliver photons to that zone and pull electrons out without resistive losses.
What Does the V-I Curve Tell You About a Cell?
The V-I curve plots voltage versus current under a set illumination. It's the fundamental characterization of a cell and the basis for everything an inverter does. A typical 400W panel under STC (1,000 W/m2, 25 deg C cell temperature) gives these key points:
| Parameter | Symbol | Typical value | What it means |
|---|---|---|---|
| Short-circuit current | Isc | 10-11A | Current when output is shorted, max possible current |
| Open-circuit voltage | Voc | 41-45V (60-cell panel) | Voltage with no load, max possible voltage |
| Maximum power voltage | Vmp | 33-38V | Voltage at maximum power point |
| Maximum power current | Imp | 9-10A | Current at maximum power point |
| Fill factor | FF | 0.78-0.84 | Imp x Vmp / (Isc x Voc), curve "squareness" |
The curve starts at Isc on the current axis (zero voltage), stays roughly flat as voltage rises, then drops sharply near Voc. The maximum power point sits at the "knee" where the V and I product is largest. A "400W" nameplate means 400 W at that point under STC: Vmp x Imp = Pmp, here roughly 36V x 11A = 396W. Fill factor for a good panel runs around 0.80, so the MPP captures 80% of the Isc x Voc rectangle.
Temperature and irradiance both shift the curve. Higher temperature mainly cuts Voc (about 2 mV per cell per degree C above 25), which is why panels lose ~0.30%/deg C in TOPCon cells and ~0.35%/deg C in PERC. Lower irradiance cuts Isc proportionally (500 W/m2 gives roughly half the Isc of 1,000 W/m2) while barely touching Voc. For how different cell technologies shift this curve, see our TOPCon vs HJT vs PERC comparison.
How Does MPPT Find and Hold the Maximum Power Point?
Maximum Power Point Tracking is the inverter's algorithm for landing the string on the V-I curve's power peak. That peak drifts constantly with irradiance and temperature, so a fixed operating point bleeds energy. Modern inverters sample the curve hundreds of times per second and adjust voltage in real time.
The most common algorithm is Perturb and Observe (P&O): measure V and I, compute power P = V x I, nudge the voltage 1-3%, then check whether power rose or fell. If it rose, keep going; if it fell, reverse. The method oscillates around the peak, holding within 1-2% under stable light. Under passing clouds or sunrise, accuracy can drop to 95-97% of available power. Fancier algorithms (Incremental Conductance, particle swarm, neural networks) trade complexity for precision; SolarEdge HD-Wave inverters and Enphase IQ8 microinverters claim 99%+ accuracy under fast-changing conditions.
Multiple MPPT channels matter for mixed orientations or shading. A residential string inverter usually has 2-3 channels, each tracking one string, so east-facing and west-facing strings each hit their own optimum. Module-level electronics push this further: the SolarEdge P370 optimizer puts a tiny MPPT controller on each panel, the Tigo TS4-A-O does the same as a retrofit for any string inverter, and the Enphase IQ8A microinverter converts DC to AC at each panel with its own MPPT.
Is that worth it on every install? Honestly, no. For an unshaded south-facing roof, string-level MPPT captures nearly all available power. Module-level electronics pay back where shading, multiple orientations, or mismatch exist, which covers most US residential installs but not all.
What Limits Real-World Cell Efficiency?
The Shockley-Queisser limit caps single-junction silicon at 33.7% theoretical efficiency under STC, yet production panels hit only 22-23%. That ~10-point gap breaks down into specific loss mechanisms engineers still fight:
Below-bandgap photons (15-19% loss). Photons below 1.12 eV pass through unabsorbed. No cell-level fix; it needs multi-junction or up-conversion.
Thermalization (33-40% loss). Photons above 1.12 eV dump their excess energy as heat, more so at shorter wavelengths. Hot-carrier cells (research) and multi-junction stacks target this.
Recombination losses (1-3% loss). Some pairs recombine before reaching the depletion zone, mostly at grain boundaries, defects, and unpassivated surfaces. TOPCon's tunnel oxide and HJT's amorphous silicon passivation attack this.
Optical losses (3-5% loss). Reflection at the air-glass interface, encapsulant absorption, and busbar shading. Anti-reflective coatings and textured surfaces help.
Resistive losses (1-2% loss). Current through finite-resistance metallization and bulk silicon. More busbars and thinner cells reduce it, at some shading cost.
Temperature derating (5-15% in operation). Summer roofs run 50-70 deg C cell temperature, not the 25 deg C of STC, so real output sags through the temperature coefficient.
The commercial cell record sits around 27.3% (Longi 2024 HBC structure). Module efficiency runs 22-23% for volume TOPCon and HJT. The gap to 33.7% narrows each year, but the easy gains are gone. The next 3-4 points will be harder than the last 8.
Citation capsule: Solar panels generate electricity through the photovoltaic effect: photons with energy above silicon's 1.12 eV bandgap excite electrons from the valence band to the conduction band, creating electron-hole pairs that the P-N junction's 0.6-0.7V built-in field separates as DC current (NREL Photovoltaic Cell Physics). The Shockley-Queisser detailed balance limit caps single-junction silicon at 33.7% theoretical efficiency; modern TOPCon and HJT production panels achieve 22-23% module efficiency, with the gap closing slowly through better passivation, anti-reflective coating, and contact metallization.
Summary
Solar panels make electricity by absorbing photons above silicon's 1.12 eV bandgap, separating the resulting electron-hole pairs across a P-N junction's built-in 0.6-0.7V field, and collecting the DC current through metallization on the front and back of the cell. A typical 60-cell panel produces ~36V Vmp at 11A Imp, around 400W under STC conditions. The inverter's MPPT continuously adjusts operating voltage to land on the V-I curve's power peak as conditions change, typical efficiency 96-98%. Real production cell efficiency runs 22-23% versus the 33.7% Shockley-Queisser theoretical limit, the gap divided among thermalization, below-bandgap photons, recombination, optical losses, resistive losses, and temperature derating in operation. For the broader system-level picture from panel through inverter to grid, see our how solar panels work guide. For the materials and construction that bring those cells together into a 25-year roof-mounted assembly, our piece on what solar panels are made of covers the build details.