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The Greening of IT
274 How Companies Can Make a Difference for the Environment

converted less than 1 percent of incident light into electricity, both
Ernst Werner von Siemens and James Clerk Maxwell recognized the
importance of this discovery. Following the work of Russell Ohl in the
1940s, researchers Gerald Pearson, Calvin Fuller, and Daryl Chapin
created the silicon solar cell in 1954. These early solar cells cost 286
USD/watt and reached efficiencies of 4.5 percent to 6 percent.
The earliest significant application of solar cells was as a backup
power source to the Vanguard I satellite, which allowed it to continue
transmitting for more than a year after its chemical battery was
exhausted. The successful operation of solar cells on this mission was
duplicated in many other Soviet and American satellites, and by the late
1960s, PV had become the established source of power for them.
Photovoltaics went on to play an essential part in the success of early
commercial satellites such as Telstar, and they remain vital to the
telecommunications infrastructure today.
The high cost of solar cells limited terrestrial uses throughout the
1960s. This changed in the early 1970s when prices reached levels that
made PV generation competitive in remote areas without grid access.
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Early terrestrial uses included powering telecommunication stations,
off-shore oil rigs, navigational buoys, and railroad crossings. These off-
grid applications have proven to be very successful and accounted for
more than half of worldwide installed capacity until 2004.
Building-integrated photovoltaics cover the roofs of an increasing
number of homes. The 1973 oil crisis stimulated a rapid rise in the pro-
duction of PV during the 1970s and early 1980s. Economies of scale,
which resulted from increasing production along with improvements in
system performance, brought the price of PV down from 100 USD/watt
in 1971 to 7 USD/watt in 1985. Steadily falling oil prices during the
early 1980s led to a reduction in funding for photovoltaic R&D and a
discontinuation of the tax credits associated with the Energy Tax Act of
1978. These factors moderated growth to approximately 15 percent per
year from 1984 through 1996.
Since the mid-1990s, leadership in the PV sector has shifted from the
United States to Japan and Germany. Between 1992 and 1994, Japan
increased R&D funding, established net metering guidelines, and intro-
duced a subsidy program to encourage the installation of residential PV
systems. As a result, PV installations in the country climbed from 31.2
MW in 1994 to 318 MW in 1999, and worldwide production growth
increased to 30 percent in the late 1990s.