How the Next Big Solar Panel Tech is Already Here

Solar panels are typically made with silicon as their semiconducting material. But you know what they say: The grass is always greener with cadmium telluride … wait, what do you mean you’ve never heard of that?

Well, I don’t blame you. Cadmium telluride-based photovoltaics (or CdTe for short) are like that underrated indie band you’ve never heard of that’s quietly building a cult following. Sure, they’re the second-most common kind of panels after silicon PV, but when silicon still makes up the vast majority of the market (by a longshot) that doesn’t mean as much.

So what on earth are cadmium telluride solar panels? And if they’re already in use today, why are they the solar panel industry’s best-kept secret?

What is CdTe and Why Does it Matter?

For most people CdTe probably sounds like something straight out of a high school chemistry quiz. Interestingly, CdTe panels are far more common in the U.S. than anywhere else in the world. But before diving into why that is, let’s take a moment to understand what CdTe even is.

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Cadmium telluride is a semiconductor material, just like silicon. As the name implies, it’s made from cadmium and tellurium — both of which are toxic on their own, but safe when combined as CdTe.¹ This isn’t too unusual. Table salt, for instance, is made from two toxic substances — sodium and chlorine — that together form something essential to life.

Cadmium is fairly easy to come by as a byproduct of zinc production. Tellurium, on the other hand, is rare, about as common as platinum, and is mostly found as a byproduct of copper mining. Since it doesn’t have many other uses, most of the tellurium mined goes straight into solar panels.²

So, why use CdTe for solar? Like silicon, it has a “band gap,” which is basically an energy barrier that electrons need to cross to create electricity. Without going into too much jargon, CdTe has a band gap of 1.5 eV, which sits right in the “sweet spot” for solar cell efficiency. It’s a bit higher than silicon’s 1.1 eV, meaning it can absorb higher-energy photons more efficiently without overheating.^{3 4 5 6}

Even better, CdTe is a “direct gap” semiconductor, which makes it better at absorbing sunlight than silicon. This is one reason CdTe panels can be thinner and still generate decent amounts of power. ^{7 8} Thinner panels are cheaper to produce and require less material, which is a big plus.

Now, I know some of you are all about the numbers, so let’s talk efficiency. CdTe panels typically hit around 18.6% efficiency, with lab versions reaching up to 22%.⁶ That’s a little behind silicon’s average efficiency of 20 to 24%, but we can push it above 22% with doping. That’s the process of seeding material-A with bits of material-B, allowing us to port some of B’s benefits to A’s. In this case, we’re seeding CdTe with conductive copper or arsenic.⁹¹⁰. Tasty, right?

But CdTe has a secret weapon: thinness. If you slim silicon panels down to the same thin-film size as CdTe, their efficiency drops to a measly 6%. So, CdTe wins the thin-film competition hands down.¹¹⁷

But what about perovskites? They’re like the solar industry’s equivalent of a solid-state battery: always just a few years away from greatness. These materials can reach an impressive 26.7% efficiency.¹² The catch? Perovskites are notoriously fragile and degrade quickly when exposed to heat, moisture, and even sunlight (kinda ironic for a solar panel).¹³ Until we can toughen them up, CdTe’s durability keeps it in the game. The U.S.-based company First Solar (more on that in a sec) is a major CdTe manufacturer, and claims their panels maintain over 89% of their original performance after 30 years.¹⁴ That’s a big deal for long-term solar installations.

So, while CdTe isn’t as efficient as perovskites, it’s more reliable, easier to produce, and already widely available.^{12 2 15} That’s right. CdTe isn’t just mature, it isn’t just commercially viable, it’s kind of commonplace. Like I said, it’s actually the second-most common PV technology on the market right now, second only to silicon.⁷ This naturally raises the question: if CdTe is here — then where is it? Because we almost always hear about silicon, but not CdTe.

The History of CdTe and First Solar

A number of companies began experimenting with them all the way back in the 1950s, with General Electric leading the charge.² However, CdTe panels didn’t really gain traction until the 1990s, when efficiency improvements made them more practical for solar power. Then came a market downturn in the early 2000s, which caused most companies to abandon CdTe technology altogether.²

But not everyone gave up. One company stuck it out—and that’s First Solar.

First Solar’s roots go back to Harold McMaster, a glass industry pioneer who initially founded Solar Cells Inc.¹⁶ McMaster had a vision for producing low-cost thin-film solar panels on a large scale. Though he started with silicon, a friend convinced him to pivot to CdTe, which ultimately set First Solar on a path to success.¹⁶ The company launched its first commercial CdTe product in 2002, and since then, they’ve been steadily increasing both the efficiency of their panels and their output.¹⁷

As of 2023, First Solar has an energy production rate of 16.6 GW and a commercial module efficiency of 19.3%.¹⁷ And that’s just in the field. In the lab, they’ve pushed CdTe efficiency up to 23.1%, as confirmed by the U.S. National Renewable Energy Laboratory (NREL).¹⁸ First Solar claims they’re on track to deliver a cell with 25% efficiency by 2025, and they’re targeting 28% by 2030.¹⁴ While traditional single-junction silicon PVs are predicted to max out at 32.1% efficiency, CdTe has a theoretical ceiling of 35.79%, so there’s still a lot of potential left to unlock.¹⁹

What sets First Solar apart is their manufacturing speed. They can produce a fully functional CdTe panel in just 4.5 hours, thanks to a process called Physical Vapor Deposition (PVD).²⁰ This process involves heating materials under a vacuum, causing them to vaporize and then condense onto a cooler surface, forming a thin, uniform film. It’s a well-understood technique in the semiconductor world and is highly efficient for producing CdTe solar panels.

On top of that, First Solar is dedicated to making their panels as environmentally friendly as possible. Compared to crystalline silicon, their CdTe panels require only 1-2% of the semiconductor material, resulting in a smaller carbon and water footprint.²¹ This helps CdTe panels achieve some of the fastest energy payback times in the industry.¹⁴ In other words, CdTe panels “pay for themselves” in terms of energy savings faster than many other types of solar panels.

First Solar isn’t stopping there. They’re actively expanding their R&D capabilities and are currently building the largest solar thin-film R&D center in the Western Hemisphere, located in Lake Township, Ohio.²² This new facility is expected to bring 300 new jobs by 2025 and help accelerate their advancements in CdTe technology.

They’re also integrating solar panel recycling. First Solar has developed a process to recover over 90% of the materials used in their panels, which is impressive considering the recovery rate for automotive materials is about 75%, and general IT is just 45%.²³ Their process involves shredding and crushing the panels, separating the semiconductor material from the glass, and then refining the materials to be reused in new panels.²⁴ This closed-loop system is a major step forward in reducing the environmental impact of solar panels.

I actually have a video on a similar solar panel recycling technique. Yes, solar panels can be recycled.

Drawbacks and Challenges

If CdTe is so popular, then how come you’ve probably never seen it? Well, while I did say it’s the second-most common photovoltaic (PV) technology, I buried the lead a little. CdTe panels only made up about 21% of the PV market in the United States in 2022, where First Solar is based, but globally? That number drops to just 4%.⁷ That’s a huge gap. So why is CdTe adoption lagging so far behind silicon?

Well, CdTe is not without its drawbacks. I already hit on the toxicity, which is going to make end-of-life recycling more critical. And I should note that even though tellurium isn’t expensive, its rarity is still a limiting factor. Though, ironically, one of CdTe’s biggest strengths might actually be a major weakness.

You see, the copper doping methods that boost CdTe’s efficiency to competitive levels also shorten its lifetime. Talk about a toxic relationship. According to the National Renewable Energy Laboratory (NREL), copper tends to move around within the CdTe cells over time, eventually degrading the lattice structure of the material.²⁵²⁶ It’s a classic case of a toxic relationship. NREL and First Solar are working to solve this problem with a process called copper reduction—nicknamed “CuRe”—that optimizes the amount of copper used, or even replaces it with arsenic.¹⁰ These efforts have already helped reduce the degradation rate to just 0.2% per year.²⁷

Another significant challenge with CdTe is its open circuit voltage (Voc), which is essentially the maximum voltage the cell can provide under no load. While CdTe should theoretically have a higher Voc due to its material properties, the copper doping introduces imperfections that lower this voltage.²⁸ This creates a tough balancing act: improve efficiency through doping, or focus on boosting the open circuit voltage? It’s a classic trade-off.

And speak of the devil, efficiency in general is another issue. At the time of writing this script, CdTe panels are simply less efficient than silicon on average, even with doping or other material tweaks. Efficiency is the name of the game when it comes to solar power, and while CdTe’s other benefits like a smaller carbon footprint and faster energy payback time are important, lower efficiency is still a major sticking point. This also has knock-on effects: CdTe solar farms generally need to be up to 31% larger to produce the same amount of power as a silicon-based farm, which makes CdTe less ideal for residential or space-constrained applications.¹¹

For researchers at places like NREL, the next big hurdles to jump are boosting CdTe’s efficiency to 25% or more and getting that open circuit voltage above 1.⁶ These might sound like small improvements, but they’re critical for keeping CdTe competitive in the long run. Hitting these targets will require optimizing several issues, from material composition to manufacturing processes.⁶ But lemme quote from a paper published last year in the journal Solar Energy Materials and Solar Cells:

“Many of these goals have been realized separately, and the research and development community is working hard to integrate these innovations together to keep the rapid growth trajectory of CdTe technology moving in order to supply renewable electricity worldwide at the terawatt scale.”⁶

That said, the real “final boss” for CdTe doesn’t lie with any of these issues. It’s just that silicon is overwhelmingly popular. Afterall, it is very reliable, with very well known strengths and weaknesses and is widely available. Shifting a market without an overwhelming advantage is hard and takes time. People, power companies, and investors really do prefer the devil they know over the one they don’t.¹¹

The Future of CdTe

So, is it CdTe’s time to shine? It’s getting there, but the future isn’t set in stone.

One major player in the future of CdTe is China. As the world’s largest producer of solar panels, it’s no surprise that several Chinese companies are showing interest in CdTe. For example, Advanced Solar Power, based in Hangzhou, has been working on CdTe since at least 2011, with efficiency rates that are close to those of First Solar.²⁹ Flat Glass Group, the world’s second-largest PV glass manufacturer, recently invested 3 billion yuan into a 1-gigawatt CdTe solar cell facility.³⁰ And China National Building Materials (CNBM) is teaming up with the German company Singulus to ramp up CdTe production by using advanced vacuum coating machines. This partnership is expected to boost CNBM’s CdTe production capacity to over 1 GW annually.³¹

While CdTe is stuck playing second fiddle to silicon for now, it might not be that way for much longer. There’s just so many possible paths forward that it’s plausible that CdTe will continue to rapidly improve and overtake silicon PVs for solar farms and other large-scale projects. Then again, it’s not like silicon isn’t also advancing, and its popularity and market dominance are probably going to be hard to shake. Though I’m sure durable, green, thin-film tech like CdTe will at the very least find a niche. In the end, it’s hard to predict where this will go next, the space is advancing rapidly, and we hopefully won’t have to wait long to find out.