The design and processing techniques necessary to incorporate bypass diodes within the module encapsulant are presented in this annual report. A comprehensive survey of available pad-mounted PN junction and Schottky diodes led to the selection of Semicon PN junction diode cells for this application. Diode junction-to-heat spreader thermal resistance measurements, performed on a variety of mounted diode chip types and sizes, have yielded values which are consistently below 1/sup 0/C per watt, but show some instability when thermally cycled over the temperature range from -40 to 150/sup 0/C. Based on the results of a detailed thermal analysis, which covered the range of bypass currents from 2 to 20 amperes, three representative experimental modules, each incorporating integral bypass diode/heat spreader assemblies of various sizes, were designed and fabricated. Thermal testing of these modules has enabled the formation of a recommended heat spreader plate sizing relationship. The production cost of three encapsulated bypass diode/heat spreader assemblies were compared with similarly rated externally-mounted packaged diodes. An assessment of bypass diode reliability, which relies heavily on rectifying diode failure rate data, leads to the general conclusion that, when proper designed and installed, these devices will improve the overall reliability of a terrestrial array over a 20 year design lifetime.