ARENA CEO Darren Miller said the funding will go to some of Australia's leading solar researchers at the University of NSW, the Australian National University and the University of Sydney.
Announcing the funding for 13 research and development projects on Wednesday, he said Australia's solar researchers have helped to make it the cheapest form of energy in history.
"But to create a future in which Australian solar energy supplies the world with clean power, fuels and products, we need to be ambitious and drive the cost of solar even lower," Mr Miller said.
Cells and modules get $27.5 million in funding, while research to improve systems, operations and maintenance of grid-scale scale solar gets $14 million.
Projects include screen printing of industrial solar cells and the use of robotics to rollout and maintain solar fields.
Minister for Climate Change and Energy Chris Bowen said Australia has been a world leader on solar photovoltaic research for decades.
"The same universities that blazed the solar PV trail will step up again to help get utility-scale technology off the ground and help transform Australia into a renewable energy superpower," he said.
ARENA's "Solar 30 30 30" goal is to increase solar panel efficiency to 30 per cent – converting 30 per cent of solar energy into usable energy – and to lower generation cost to 30 cents a watt by 2030.
Ultra low-cost solar could unlock commercially viable production of liquid hydrogen as an alternative fuel and power new heavy industries, including low-emission steel and aluminium.
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