Work has begun on a solar panel system for Terminal 1 following a $1 million commitment from the South Australian government, Adelaide Airport and contractors Hansen Yuncken and BP Solar said in statements.

The 114 kilowatt system - 760 panels covering an area of about 1170 square metres - will produce enough electricity to power 30 households.

The system will not generate enough power to run the airport.

But it will slash greenhouse gas emissions by about 160 tonnes a year, the equivalent of taking 40 cars off the road, and cut the airport operator's exposure to expensive peak power prices, a BP Solar spokesman said.

The rooftop system will be the state's biggest and the second largest in Australia after the Queen Victoria Building in Sydney, the spokesman said.