Sharp (OTC BB: SHCAY.PK), the world's largest manufacturer of solar cells, announced this week at the Solar Power 2006 conference that it is pursuing four new solar-related initiatives. Doing so could widen the company's already sizeable lead over competitors such as Kyocera (NYSE:KYO) and Evergreen Solar (NASDAQ:ESLR).

The most significant of the four initiatives is the design of a new prototype solar panel that sits beneath a lens. The configuration concentrates sunlight and could increase to 36% the amount of sunlight that the solar cells convert into electricity. Existing conversion rates hover between just 13% and 22%.

If it works as planned, the system could help counter SunPower's (NASDAQ:SPWR) announcement yesterday that it has found a way to increase the efficiency of solar cells by 40%.

The second advance Sharp revealed yesterday was news of another prototype solar cell. This one combines a layer of amorphous silicon with a layer of conventional, crystalline silicon. The combination makes solar cells nearly transparent and suggests that windows could become an increasingly popular method of installing solar cells on homes and buildings.

Both of Sharp's prototype systems are at least a year or two away from the commercial marketplace. The company's other two initiatives, however, are here today and could begin affecting Sharp's bottom line almost immediately.

The first of these initiatives is the creation of a new solar-racking system -- noteworthy because it is expected to significantly reduce the amount of time and labor necessary for installing a solar cell. The other was the announcement that the company is teaming up with Citibank, the banking arm of Citigroup (NYSE:C), to let consumers finance new solar systems through a home equity line of credit.

This latter development is important because it will help consumers overcome the biggest barrier to purchasing solar cells -- the large upfront expenditure. By making the cost a little easier to swallow, the program should go a long way toward increasing sales.

All told, the four initiatives suggest that Sharp is pointed in the right direction. Investors interested in solar should keep an eye on the company, because it doesn't appear likely to lose its lead anytime soon.

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Fool contributor Jack Uldrich has a sunny disposition, but he doesn't have solar panels on his house . He does not own stock in any of the companies mentioned in this article. The Fool has a strict disclosure policy.