Future of Solar in Australia: Renata Egan on Peak Silicon

How Australia helped create the global solar industry

Much of today’s solar industry traces back to UNSW. Researchers there trained the people and developed the techniques that Chinese manufacturers later scaled to global dominance. In the mid-1990s, solar panels were made from offcuts and waste wafers from the computer chip industry. Everyone expected solar demand to grow, so the race was on to find a cheaper way to make the light-absorbing material.

Two strategies competed:

1. Thin film. Pacific Solar started in 1995, built a pilot line by 2000, and took its silicon-on-glass technology into manufacturing in Germany by 2005 with the Q-Cells group, alongside about five other thin-film technologies.
2. Scale the old way. In 2000, Dr Shi Zhengrong went to China to found Suntech. His plan was to use conventional silicon, make it as cheaply as possible, and solve problems while scaling.

Scale won. Suntech became the largest solar manufacturer in China, and its early growth was funded largely by US stock markets. By 2005–2006, Chinese factories were building 1 GW production lines, up from 100 MW a few years earlier.

Why did China move faster? Egan points to a growing economy that needed growth, faster decision-making, and a willingness to take risks. Markus shared a German engineer’s comparison: German firms perfect a product over two years, while Chinese firms release at 60–70% and learn from the market.

How solar panel technology has evolved

Solar panels have moved through several technology generations, taking module efficiency from about 11% to 25% and panel power from around 140 W to 600–700 W.

You can see these changes on the panel itself: round-cornered mono cells, square poly cells with a visible crystal pattern, the early two-busbar designs, and now tightly packed half-cut rectangles.

Why half-cut cells? Wafers are now cut from such large silicon ingots that each cell produces a lot of current. Cutting the cell in half lowers resistance and keeps power output high.

Why do panel models change so often? Manufacturers must keep raising capital, and investors want to see “what’s next”. That pressure, plus learning by doing at huge scale, means a new wattage class arrives every year or two. It is why installers struggle to match an old 175 W panel when a customer wants to expand.

Thin film mostly lost the race because silicon improved faster. The exception is First Solar’s cadmium telluride, which still produces at low cost and anchors US panel prices at roughly 30–50 US cents a watt.

How far have solar panel prices fallen?

Solar panel prices have fallen roughly 98% in 30 years: from about $12 a watt in 1995, to the industry’s “magic number” of $1 a watt around 2008, to roughly 20–28 Australian cents a watt for volume buyers today.

In the late 2000s, $1 a watt was the target that would let solar beat coal. Egan recalls the Suntech team asking how they could match a rival already producing at that price. Today, Australian installers buying in volume often pay a fifth of that.

For homeowners, the change is just as stark:

• Early 2000s: a 1 kW system cost about $8,500 with no rebate. A letterbox drop of 10,000 brochures produced two enquiries, because payback was about 18 years.
• Late 2000s: Egan paid about $12,000 for a 2 kW system, helped by the $8,000 rebate and a 60-cent feed-in tariff.
• 2026: a typical home system costs a fraction of that. Saul Griffith has compared an $8,000 Australian system with nearly $30,000 for the same system in the US, where permits and approvals add cost.

Few everyday products have fallen this far. As Markus put it, it is like a $200,000 car now costing $2,500.

What is “peak silicon”? The 27% efficiency limit explained

“Peak silicon” is the point where silicon solar cells can’t get meaningfully more efficient. Egan expects the industry to reach it before 2030, because silicon has a practical limit of about 27% conversion of sunlight into electricity.

The numbers show how close we are:

• Best cells in production: close to 27%
• Mainstream cells: about 26%
• Mainstream modules: about 25%

UNSW’s Martin Green and his team held the world record for a 1 cm² silicon cell at 25% for roughly 25 years, from about 1990 to 2015. A decade later, Chinese factories produce cells at that efficiency routinely. Egan calls that a lesson in how fast an industry learns when it invests and scales.

Is 25% efficiency good?

Yes. Here is how it compares, using the figures discussed on the podcast:

What comes after silicon?

Researchers are now stacking different materials on top of silicon, known as tandem cells, so each layer captures a different part of the light spectrum. Egan’s point is that the industry is only about 20 years old. As silicon saturates, the research effort and investor money will move to whatever comes next.

“We’re going to get to peak silicon before 2030.” Professor Renata Egan

Why didn’t Australia become a solar manufacturing powerhouse?

Australia leads the world in solar research but not solar manufacturing because investors are risk-averse and have easier options, Egan says. Mining and property offer reliable returns, and three-year election cycles make 20-year industrial plans hard to sustain.

The countries that built solar industries all gave early movers a safety net or incentive to take risks: Japan first (Kyocera, Sharp), then Germany (Q-Cells), then China (Suntech). Many of those pioneers got burnt, “but in the process something bigger started”. Australia never offered that.

Keeping up also required brutal growth. A manufacturer had to double output roughly every three years, raising fresh capital each time. Western and Japanese makers including BP Solar, Kyocera, Sharp and LG could not match that pace, and most left the Australian market.

“We don’t have the political will or vision to say, ‘This is where we could be in 20 years’ time.'” Professor Renata Egan

What is Australia doing now?

The federal government has committed $1 billion to rebuild local solar manufacturing through ARENA’s Solar Sunshot program. Egan worked on the study behind it, which recommended $6–10 billion to start a real industry. Less than half of the $1 billion has been allocated so far.

Early projects target the “low-hanging fruit” of module assembly:

• Tindo Solar (South Australia): expanding module manufacturing.
• SunMan (Hunter Valley, NSW): Dr Shi Zhengrong’s flexible, lightweight solar panels.

The bigger prize is silicon. Australia already makes metallurgical-grade silicon in Western Australia, but ships most of the raw material overseas, where each processing step adds roughly 10 times the value. Egan does not argue for a full supply chain. She argues for enough of one to give Australia leverage, so the country is not reliant on a single supplier as Turkey, India, Malaysia and the US diversify production.

Why batteries matter for the next wave of solar

Batteries restore the value of midday solar, and that reopens the solar market. Without storage, Egan says, “solar is stuffed”, because there is already more daytime generation than the grid can use.

Her reasoning:

1. Rooftop solar floods the grid in the middle of the day, pushing wholesale prices to zero or below.
2. Systems get curtailed (switched off), so new solar, especially larger commercial systems, can’t earn a return.
3. Improving cell efficiency by 1% is pointless if 30% of output is lost to curtailment at midday.
4. Home batteries (boosted by the federal battery rebate), grid-scale batteries and schemes such as the Solar Sharer soak up that midday energy.
5. Midday power regains value, and building more solar makes financial sense again.

Markus raised the other side: if midday power has value again, households deserve better than a 2-cent feed-in tariff, and wholesale prices that are too low can deter investment in the solar farms needed when coal plants close. Egan agreed low wholesale prices are not always good, but said batteries were the necessary first step.

Both agreed on one lesson from large solar farms: new projects should come with a battery. That smooths supply, answers the “sun doesn’t always shine” objection, and avoids the cost and community anger of long new transmission lines.

Commercial rooftop solar: Australia’s “missing middle”

Commercial and industrial rooftops are the fastest way to add large amounts of solar, Egan says. Extending small-scale solar incentives (STCs) from 100 kW systems up to 1 MW is “a good idea”.

Why it works:

• Speed. Residential rooftop solar succeeds because there are only one or two decision-makers and regulation is light. The same model can be applied to commercial roofs.
• Scale. Australia installs about 5 GW of solar a year. Egan believes commercial rooftops could add another 5 GW a year using existing installer processes. Markus cited estimates of up to 80 GW of untapped commercial roof space.
• No new transmission. Energy is produced where it is used, avoiding the cost and opposition that big solar farms and power lines face.
• Faster than mega-projects. Visions such as SunCable’s 30 GW solar-to-Singapore project take decades. Rooftop solar can scale in five to six years.

The main barrier is the split incentive: the business using the electricity often doesn’t own the building, so the landlord has little reason to invest. Both agreed systems should be paired with batteries.

What about apartments and rentals?

Apartments are harder than they look. A typical 12-unit block might fit only 20–30 kW of solar, which is a small share per household. Strata approvals, shared batteries and flat-rate billing add complexity. Markus suggested a model of rooftop solar, balcony solar and a shared battery, tested first in a pilot of 300–500 buildings.

For rentals, Markus praised Queensland’s landlord program and suggested landlords could share savings with tenants, for example raising rent $20 a week on a system saving the tenant $50 a week.

The hidden problem: solar systems nobody checks

Many public solar systems sit switched off for years. Markus described a council system worth tens of thousands of dollars a year in savings that was off for four years. Egan’s husband returned to a school two years after a renovation to find its new solar had never been turned on.

The fix is simple: schools, councils and businesses should book a solar inspection every few years. Markus says around 60% of the systems inspected by maintenance specialists have something switched off or faulty.

Australia’s solar future to 2050

Australia will need 10 times more solar by 2050, Egan estimates: from about 40 GW installed today to somewhere between 400 GW and 1 TW.

Her reasoning is that electricity demand will roughly double by 2050 as transport and industry electrify, data centres grow and green minerals processing starts. She expects 50–70% of that demand to be met by solar.

Where Australia’s economic opportunity lies

Egan sees Australia’s long-term prosperity in adding value to its own resources, using cheap solar and wind energy:

• Green steel from Australian iron ore.
• Silicon processing, moving beyond metallurgical-grade silicon towards polysilicon for solar cells.
• Green minerals processing, with early activity around Gladstone in Queensland.

The urgency comes from carbon pricing overseas. Europe is introducing a carbon border price, and China’s latest five-year plan includes an internal carbon trading scheme. If China moves as fast on carbon accounting as it has on solar, Egan expects it to overtake Europe within five years. Then what Australia sells to China, including coal and iron ore, will be judged on its emissions.

Australia’s natural advantages

Markus and Egan agreed Australia is “in a sweet spot”:

• Abundant sun, wind and land, with low population density.
• Location in the same time zones as fast-growing Asian economies, including China, India and Indonesia.
• An English-speaking gateway between Asia and the West, with a multicultural workforce.
• Strong farming, research, education and training.
• China as its largest export partner.

Egan’s conditions for success are good communication to help people through change, and respectful use of land that carries meaning for Indigenous Australians and local communities. “There’s lots of upside,” she says. “There’s lots of reason to be positive.”

Why more people need to join the industry

UNSW founded the world’s first School of Photovoltaics and Renewable Energy Engineering, and it attracts students worldwide. But Egan says engineers alone aren’t enough. The next phase needs policymakers, bankers, lawyers, financiers and marketers who understand solar and can bring the public along.