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A solar cell uses the photovoltaic effect to turn photon energy into electrical work. In a semiconductor, above-gap photon absorption generates an Electron in the conduction band and an electron hole in the valence band. A p-n junction, together with selective electrical contacts, collects the two carrier species at opposite terminals. Carrier diffusion and the built-in electric field help separate them before electron-hole recombination. Illumination maintains different quasi-Fermi levels for Electrons and electron holes; their splitting, divided by $e$, sets the available terminal voltage in an ideal device. The equilibrium built-in potential alone cannot continuously deliver work.

For an ideal junction, the illuminated output current density isHere $J_{\mathrm{sc}}$ is the photogenerated short-circuit current density and $J_0$ the diode saturation current. The useful operating point maximizes $VJ$, rather than either current or voltage separately. With solar-cell fill factor $\mathrm{FF}=P_{\max }/(V_{\mathrm{oc}}{I}_{\mathrm{sc}})$,Series resistance, shunts, incomplete photon absorption and nonradiative recombination reduce the attainable efficiency.

The Shockley-Queisser limit removes these avoidable losses but retains the following physical constraints. There is one semiconductor junction with one band gap; each absorbed above-gap photon yields at most one collected electron-hole pair; carriers thermalize to the cell temperature; and the inverse optical process produces unavoidable radiative recombination. If ${\Phi }_{\odot }(E)$ is the incident photon flux per unit energy, ideal photon absorption givesThe same ability to absorb light requires the junction to emit it. At a forward voltage $V$, the emitted photon population has a chemical potential $eV$; in the ordinary nondegenerate limit the resulting recombination current is the exponential diode term above. Maximizing $VJ$ with this radiative $J_0$, and then choosing $E_g$, gives the limiting efficiency.

A small band gap collects many photons but gives a low voltage and large thermalization losses. A large band gap permits a larger voltage but transmits too much of the incident spectrum. Below-gap photons are lost to transmission, excess photon energy above the gap becomes heat, and radiative emission and its associated entropy loss keep $e{V}_{\mathrm{oc}}$ below $E_g$. The optimum single-junction conversion is roughly thirty percent under ordinary unconcentrated sunlight; the precise ceiling depends on spectrum, cell temperature and optical geometry. The original detailed-balance calculation gave about $30\%$ at $E_g\simeq 1.1\mathrm{eV}$ under its specified assumptions.^[ref] Multiple junctions and optical concentration change the assumptions and consequently change the bound.

At equilibrium, majority Electrons undergo diffusion from n to p, while majority electron holes diffuse from p to n. Their departure exposes positive donors on the n side and negative acceptors on the p side. The resulting electric field points from n to p and opposes further diffusion. Equilibrium is reached when the chemical potential is constant across the junction. The built-in potential is this electrostatic adjustment, not a discontinuity of the material's band gap.

Since electronic band energies shift by $-eV(x)$, both the conduction band and valence band undergo band bending down from p to n by $e{V}_b$ at zero applied bias. Their separation remains the same gap. In the nondegenerate thermal equilibrium limit the built-in voltage can also be expressed using neutral-edge densities as $e{V}_b=k_{B}T\log (n_n/n_p)=k_{B}T\log (n_n{p}_p/n_i^2)$.

Take the n-contact potential and its electrochemical potential as reference. Applying $V_{\mathrm{ext}}$ to the p side changes the total depletion-layer drop toThus $V_{\mathrm{ext}}<0$ is reverse bias: it increases the barrier and widens the depletion region. The bands have horizontal tangents at the neutral edges in this approximation and a smooth cubic bend within the linearly graded layer.

A biased junction is not in global thermal equilibrium. Its contact electron electrochemical potentials obeyUnder reverse bias the p-contact level is higher by $e|V_{\mathrm{ext}}|$. A single horizontal equilibrium chemical potential cannot describe this state; electron and hole quasi-Fermi levels describe the nonequilibrium populations. The sketch marks the contact levels. Detailed spatial quasi-Fermi profiles require transport and recombination information beyond the electrostatic doping profile.

The photovoltaic effect is the production of an electric potential difference or an electric current by photon absorption in a material or device. In a semiconductor, absorbed photons generate Electrons and electron holes; asymmetric transport and selective collection can maintain distinct quasi-Fermi levels and deliver electrical power to a load. An equilibrium built-in potential alone supplies no continuous electrical power.

A quasi-Fermi level is a local electron or hole population parameter in a semiconductor driven out of equilibrium, assuming each population is internally close enough to thermal equilibrium to use a Fermi-Dirac distribution. Separate electron and hole parameters replace one common equilibrium chemical potential. Their spatial profiles depend on transport, generation and recombination as well as electrostatics. For ideal ohmic contacts with the p voltage $V$ relative to n, the contact electron electrochemical potentials obey ${\mu }_p-{\mu }_n=-eV$.