The photovoltaic industry is undoubtedly at a turning point. High margins and low costs have made solar module technology cost-competitive in the energy economy and created a race-to-the-bottom phenomenon among panel manufacturers. While low costs are great for short-term market expansion, this focus on cheap materials compromises the quality and long-term reliability of modern solar assets, and the future viability of the industry as a whole.

In the United States, the pending Section 201 trade case has many buyers and sellers in the solar market confused as to what panel manufacturing will look like in the years ahead. The goals of the solar energy industry remain the same: to reduce carbon emissions, achieve grid parity for renewable resources and create resilient clean energy infrastructure. This point in solar history offers an opportunity for technology providers, project developers and asset owners to evaluate and understand strategies for deriving the largest value from solar projects. The highest energy yield and long-term resiliency of technologies are once again defining success in the new PV era: PV3.0, the era of the high-efficiency module.

The specific technology employed during different times of the PV evolution provides key insight into the historical transformation of the solar energy industry. In order for the solar industry to maintain its impressive worldwide growth and gain a foothold in emerging markets, the industry must understand these stages of evolution, including both their successes and setbacks. There have been three key eras: PV1.0, marked by the birth of the silicon PV cell and exploration around the application of clean energy; PV2.0, which brought about the global mass commercialization of solar and more affordable yet lower quality module technologies; and PV3.0, the era we are just now entering. Building on the technical and market knowledge gained during previous stages of PV development, PV3.0 realigns the industry using quality materials to achieve lasting high energy yields. To understand the future of solar panel technology, it is essential that we also reflect on all three stages of historical PV development.

Bell Labs created the first silicon photovoltaic cell in 1954, marking the beginning of the PV industry and first PV era, which would extend until 2000. Engineers and scientists discovered new applications for solar, from using PV technologies as the primary power source for earth-orbiting satellites to building panels into communication infrastructure systems. Then, in 1982, the first grid-connected photovoltaic project was established in Switzerland, which consisted of a 10-kW roof array using monocrystalline modules.

During this era, monocrystalline modules were largely the technology of choice. Defined by nearly perfect crystal structure and a homogenous crystalline framework, monocrystalline cells are single, continuous silicon crystals. This crystal purity results in high performance technology. For example, monocrystalline PV power plants built in the 1980s in Europe, the United States and Japan are still running today, well over 30 years later.

A central characteristic of the next era in solar panel technology development, PV2.0, is the feed-in tariff (FIT) program that powered photovoltaic markets in Germany and Europe. Policy makers across the world began creating new models to compensate solar developers and energy generators for the value they added to the grid, incentivizing the mass deployment of solar. The cumulative global installed PV capacity increased from 1,000 MW in PV1.0 to 300,000 MW throughout PV2.0.

Due to the increased market demand throughout PV2.0, more affordable polycrystalline modules took center stage and became the technology of choice for new installations. However, gradually there appeared to be several problems with this rapid development fixated on low-cost modules. Specifically, minimal product differentiation, low material reliability and serious system degradation threaten the health of the PV industry. The next stage of PV development must address these issues.

Fortunately, PV3.0 is now upon us. The solar market is maturing—the industry as a whole is no longer looking for quick fixes and, with 60 years of experience, now has the vantage point to appreciate the long-term value of solar assets. Low-cost solutions and the lower efficiency associated with them are unable to compete with the multiplying returns that high-quality technology offers. PV3.0 will be marked by a return to the high-yielding and reliable monocrystalline cell technology. Due to the higher efficiency associated with monocrystalline modules, developers can also pack the same amount of generating power into a smaller footprint. This translates into cost savings during project development, as high-quality modules allow for less labor, fewer materials and much less overall maintenance. There is also less degradation associated with monocrystalline technology, ensuring the longevity of projects and savings from delaying system replacements.

Research and development has played a central role to the technology advancements in each PV era, and continued investment in R&D will be essential to the solar industry’s competitiveness. Companies around the world are already seeing returns on these research and development investments and are producing high-efficiency, high-reliability and high-energy yield solar modules. Global policies are also changing in favor of monocrystalline; for example, under China’s 2017 “Top Runner Program,” feed-in-tariffs will favor high-efficiency projects. PV3.0 will seek to build upon and combine lessons learned in the past two solar technology eras to create win-win scenarios for all parties involved.

The solar industry’s continual evolution distinguishes it from other power generation industries. While photovoltaics have made great strides since their initial deployment more than five decades ago, there is still work to be done. A new era focused on the commercialization of high-efficiency modules promises to ensure the continued viability of solar power as a global power source.

Mr. Wenxue Li is the president of LONGi Solar. In 2010, he joined LONGi Silicon Materials (Ningxia), and since assuming leadership of LONGi Solar has overseen the company’s rapid growth and expansion, and made great contributions to upgrading corporate management and improving production efficiency and worker productivity. In the past year, LONGi has become one of the fastest growing PV manufacturers in the world, in addition to be named a tier one manufacturer by Bloomberg and appearing as the only new energy company on Goldman Sach’s ‘Nifty 50’ list of Chinese companies.