The energy balance of photovoltaic (PV) energy systems is analysed in order to evaluate the energy pay-back time and the CO, emissions of grid-connected PV systems. After a short introduction on energy analysis methodology we discuss the energy requirements for production of solar cell modules based on crystalline silicon and on thin-film technology, as well as for the manufacturing of other system components. Assuming a medium-high irradiation of 1700 kWh/m(2) yr the energy pay-back time was found to be 2.5-3 yr for present-day roof-top installations and almost 4 yr for multi-megawatt, ground-mounted systems. Prospects for improvement of the energy balance of PV systems are discussed and it is found that for future PV technology tin 2020) the energy pay-back time may be less than 1.5 yr for roof-top systems and less than 2 yr for ground-mounted systems (under the same irradiation). The specific CO, emission of the roof-top systems was calculated as 50-60 g/kWh now and possibly around 20 g/kWh in the future. This leads to the conclusion that CO, emissions of present PV systems are considerably lower than emissions from fossil-fuel power plants, but somewhat higher than for wind and biomass energy. No significant contribution to CO, mitigation should be expected from PV technology in the year 2010. In the longer term, however, grid-connected PV systems do have a significant potential for CO, mitigation.