The quest for ultra-low cost solar is now far more dependent on cheaper construction methods and system integration rather than reductions in the price of cells and modules, according to a new report from the Australian Renewable Energy Agency.
The report provides an update on Arena’s 30-30-30 vision: to achieve 30 per cent module efficiency and 30 cents per watt (W) installed cost by 2030, and solar electricity below $20 per megawatt-hour. It comes three years after that vision was outlined in the Incredible ULCS – Ultra Low Cost Solar White Paper.
Solar has gone from strength to strength, dominating global energy markets to deliver a record 664 gigawatts (GW) of new generation capacity installed across the world in 2025 – a tripling of global PV capacity in just four years.
Technology has improved, too, with universities and some of China’s major manufacturers constantly chipping away at cell and panel efficiency rates and seeking out cheaper and more abundant materials to replace some of the key ingredients for making cells and panels.
Arena says cell efficiencies are now approaching 30 per cent in laboratory settings, with commercial module efficiencies continuing to improve into the mid-20 per cent range, supported by bifacial module designs and ongoing improvements in cell architecture.
The new report, however, finds that while solar technology continues to improve, the cost of deploying large-scale solar in Australia has not fallen at the same pace, largely because of the civil construction costs that have burdened all technologies. And it suggests a shift focus for the industry to get cost part of the 30-30-30 mission back on track.
“Australia needs a shift in focus towards how solar projects are delivered, not just what is installed,” says Arena chief Darren Miller.
“Without a change to the approach in how large-scale solar is built, financed and integrated, we risk missing the opportunity to bring costs down fast enough to support the next phase of the energy transition.”
According to the report, significant cost reductions will mean coordinating progress across construction methods, workforce productivity, system integration and market design.
“These challenges are reflected in the evolving focus of Arena’s ultra low-cost solar portfolio,” the report says. “Increasingly, investments are targeting the full cost stack of solar deployment, including construction methods, system integration and operational performance.”
On the construction side, the white paper points to four Arena-backed companies that have focused on improving productivity, reducing risk and enabling more repeatable construction approaches, including Adelaide-based 5B, which makes prefabricated, modular solar systems that slash construction times and costs.
Another company, Built Robotics, is developing automated piling processes to reduce reliance on unskilled manual labour for some of the more gruelling and potentially dangerous early works of large-scale solar farm construction.
On the operations and maintenance side, the focus is on supporting innovations that improve monitoring and fault detection and prediction, such as the advanced diagnostics being developed by Lab360 to to identify faults and improve asset performance.
Arena says it is also turning its attention to supporting projects that can demonstrate multiple innovations within integrated, real-world deployment environments, like the Fortescue Solar Innovation Hub in the Pilbara.
Meanwhile, a focus on work to continuously boost cell efficiency remains critical to the cost reduction core mission.
“A 10 per cent improvement in module efficiency means that 10 per cent less concrete, steel, labour and land is required for the same amount of energy produced by the same solar farm,” the report says.
“Higher efficiency modules can reduce the amount of land, mounting structures, cabling and associated infrastructure required per unit of electricity generated, contributing to lower levelised costs.
“These approaches are intended to ensure that continued gains in efficiency contribute meaningfully to reducing system-wide costs by 2030.”
To this end, Arena continues to support the Australian Centre for Advanced Photovoltaics (ACAP) – a collaboration of Australia research institutions to undertake foundational research into next-generation solar technologies.
As Renew Economy has reported, Arena recently extended its funding for ACAP out to 2033 with an additional $95.4 million towards a $220 million national research initiative that is supported by co-investment from ACAP’s seven universities, and industry partners.
“This extension will enable continued research into high-efficiency cell designs, advanced materials and new manufacturing approaches that can support efficiencies beyond those achievable with current commercial technologies,” the report says.
Arena is also supporting the innovations of SunDrive, whose PV technology promises to deliver an installed cost of solar that is 20-30% cheaper than other high-efficiency cells by uses copper for PV cell metallisation, instead of silver.
“Australia has a strong foundation in solar, but the next phase will depend on how quickly we can translate innovation into industrialisation,” Miller said on Thursday.
“The progress we’re seeing today gives us confidence in what’s possible, but the next few years will be critical to turning this potential into reality.”
The Ultra Low-Cost Solar White Paper Update is available on ARENA’s website.
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