In today's climate of growing energy needs and increasing environmental concern,we must have to think for an alternative to the use of non-renewable and polluting fossil fuels.Solar panel is the fundamental energy conversion component of photo voltaic(PV)systems. Maximum power point (MPP)tracking is popular for small-scale systems based on economic reasons.Equivalent circuit, current-voltage, power-voltage characteristics of photovoltaic systems and the operation of some commonly used MPPT techniques has been decribed here.A new perturbation and observation algorithm was formed and that has been validated with the help of practical data along with modelling and the results of simulations which compare its performance with algorithms of conventional P&O technique.The new technique can track MPP much faster than conventional perturb and observe method.