MIT and the Fraunhofer Institute are to establish a research centre in Massachusetts focused on reducing the cost of solar energy over the next five years.

The MIT-Fraunhofer Center for Sustainable Energy Systems is being established to develop technologies and materials aimed at designing and producing better solar modules.

The facility will be built alongside the MIT campus and will specialise in solar research and other areas of sustainable energy sources.

"This partnership will pair the outstanding basic energy research capabilities at MIT with the world-class applied research capabilities of the Fraunhofer Institute," said Professor Ernest Moniz, director of the MIT Energy Initiative.

"The research addresses extremely important technologies for long and short term responses to global energy challenges.

"Also, the strong support of the Commonwealth, the Massachusetts Technology Collaborative and National Grid represents the kind of public-private partnership that we will need to succeed."

Start-up costs of the centre will be funded with $5m from the Massachusetts Technology Collaborative.

Nolan Browne, MIT alumnus and founder of the MIT Energy Conference, will serve as the centre's managing director.

Tonio Buonassisi, assistant professor of mechanical engineering at MIT, will take up the role as the centre's scientific director.

Roland Schindler, who has been at the Fraunhofer Institute for 24 years, will serve as the centre's executive director and act as a liaison between the MIT team and Germany.