It is generally recognized that BIPV (building integrated photovoltaics) has the potential to become a major source of renewable energy in the urban environment. The actual output of a PV module in the field is a function of orientation, total irradiance, spectral irradiance, wind speed, air temperature, soiling and various system-related losses. In urban areas, the attenuation of solar radiation due to air pollution is obvious, and the solar spectral content subsequently changes. The urban air temperature is higher than that in the surrounding countryside, and the wind speed in urban areas is usually less than that in rural areas. Three different models of PV power are used to investigate the effect of urban climate on PV performance. The results show that the dimming of solar radiation in the urban environment is the main reason for the decrease of PV module output using the climatic data of urban and rural sites in Mexico City for year 2003. The urban PV conversion efficiency is higher than that of the rural PV system because the PV module temperature in the urban areas is slightly lower than that in the rural areas in the case. The DC power output of PV seems to be underestimated if the spectral response of PV in the urban environment is not taken into account based on the urban hourly meteorological data of Sao Paulo for year 2004. (c) 2006 Elsevier Ltd. All rights reserved.