Three dimensional city models are presently being used in many sectors. The potentiality of three dimensional data has been exploited by many researchers and applications. It has been realized that 3D data are not only for visualization or navigation but to solve more complex problem like urban planning, disaster management, facility management etc. Such a problem is solar energy potentiality analysis and shadow effect analysis in this case is even harder. Photovoltaic cells are being popular for energy production. So many applications have been developed to know the potentiality before using this technology. The quality of the result depends on shadow effect which is very difficult to detect. 3D city models are high quality, realistic and with high details and geometries. So, 3D city models are the most practical option for detecting shadow. This paper will present a concept for detecting realistic shadows using 3D city models and getting highly accurate result of photovoltaic energy production taking the shadow effect into consideration. Levels of detail 2 and 3 CityGML data which contains roof structure, vegetation, thematically differentiated surface and texture are suitable to simulate exact real-time shadow. LIDAR point clouds are also triangulated to produce a TIN for 3D city modeling. Solar radiation data during the whole day and around the year and photovoltaic cells response to the radiation can be modeled using available simulation environment like INSEL. The recent research works in this direction has been mentioned in this paper and the need for the investigation of this approach has been illuminated.