Shade & Solar Panels

Let’s get one thing straight: placing a solar panel in the shade is not a great idea. The less sunlight a panel receives, the less electricity it produces. Despite price drops in recent years, solar panels are still a significant investment, so it would be a waste to install them in a spot with low energy yield. If possible, always go for full sunlight—it just makes sense.

That being said… there are plenty of scenarios where solar panels will inevitably deal with shade. Think of early mornings, late evenings, or winter months. Sometimes, a small chimney is just in the way, or a neighbor’s tree grows faster than expected. And in some cases, aesthetics play a role—creating a neatly aligned array of panels on a roof, even if one or two occasionally fall into the shade of a neighboring house. But is that really such a big deal?

Not really. But it is important to consider how to minimize energy loss and prevent potential damage. That’s why we’ll dive deeper into the effects of shading on solar panels and the choice of inverters.

Our advisors specialize in conducting thorough shading analyses and can accurately determine whether solar panels on your roof will generate sufficient returns.

To get a good understanding of the effects of shade on solar panels, we first need to understand how the panels are made up with their individual cells, and what the role of the by-pass diodes is. See also this article.

Bypass Diodes and Shade: What’s Their Role?

Solar panels come equipped with bypass diodes that reroute electricity if a cell is defective. But when solar cells are shaded, an interesting phenomenon occurs. A shaded cell isn’t broken, but it also doesn’t contribute as much as the sunlit cells around it. Electricity can still flow through the shaded cell, but much less than through the others. So, will the electricity pass through the shaded cell, or will it be redirected via the bypass diode? The answer: it depends on how many cells are shaded. The inverter also plays a key role.

A Single Shaded Solar Cell

Imagine a single cell is shaded—maybe because a leaf has landed on it—while all the others are in full sunlight. In this case, the electricity will force its way through the shaded cell. Since the shaded cell can’t conduct as much electricity, it essentially acts as a resistor. Instead of generating energy, it starts absorbing it, releasing the excess energy as heat. The result? The shaded cell gets significantly hotter than the others—a phenomenon known as a “hot spot.”

Multiple Shaded Solar Cells

When multiple cells are shaded, the electricity has two options. It can either force its way through the shaded cells, producing only a weak current since the shaded cells limit the flow. Or, it can bypass the shaded section entirely, using the bypass diode to maintain a much higher energy output. The latter is, of course, the ideal scenario—but how do we ensure this happens? The answer lies in the inverter.

The Role of the Inverter

Inverters are equipped with an MPP (Maximum Power Point) tracker, which continuously searches for the optimal voltage to maximize energy output. Depending on the voltage the MPP tracker selects, the shaded cells may either remain part of the circuit (limiting the current) or be bypassed (allowing higher energy production). This makes the inverter crucial—choosing the right one can significantly impact energy yield during shading and improve annual output by several percentage points.

Whether an inverter handles shade well depends on the software controlling its MPP tracker. All current SMA inverters feature “ShadeFix” (formerly called 'OptiTrac Global Peak'), which automatically bypasses shaded panels or sections to optimize energy production. Some other inverter brands offer similar technology, but many do not. So, be mindful when selecting your inverter! This video from SMA clearly explains how ShadeFix works.

Panel Optimizers: Another Solution

Another way to mitigate shading effects is through optimizers. These small devices are installed behind each panel and connected to the string that leads to the inverter. Optimizers enable MPP tracking at the panel level, meaning a shaded panel can still contribute to the system’s overall energy yield.

The key difference between optimizers and smart inverter software like ShadeFix is that optimizers allow the shaded panel to generate some power, while ShadeFix simply bypasses the shaded section. So, is it worth installing optimizers for shading, or is ShadeFix sufficient?

ShadeFix or Optimizers?

The answer depends on your situation. Ultimately, it comes down to: how much does an optimizer cost, and how much additional energy will it generate? Some optimizer systems, like those from market leader SolarEdge, require optimizers to be installed on all panels, even those that are never shaded. This can increase costs and make the system more prone to malfunctions (since more components are involved). Additionally, the extra energy gain from optimizers may not always be significant—if shading only occurs in the early morning or late afternoon when sunlight is already weak, the investment may not be justified.

As a guideline, SMA provides the following estimate: a solar panel system where 20% of the panels are shaded for 20% of the time would generate 5% more energy with ShadeFix compared to a system without it. The same system equipped with optimizers would yield 9% more energy—a difference of only 4%. Note: This applies to systems with morning or evening shading. If shading occurs during peak daylight hours, optimizers will likely perform better. For shading that moves across multiple panels throughout the day, a SolarEdge system is often a good choice.

Our Advice

The best choice for your system depends on several factors: your roof layout, the type of shading, and when it occurs. Additionally, your priority—whether maximizing output or finding the best cost-to-benefit ratio—also plays a role. Since determining the best option can be complex, we always recommend consulting one of our advisors. They offer free assessments and can provide tailored recommendations based on your specific situation.