To prepare hydrogenated amorphous silicon-germanium alloys as low gap material for multi-junction solar cells in plasma enhanced chemical vapour deposition, the well established concept of strong dilution of the process gases with hydrogen has been used. Two different regimes of alloying were found: for low Ge content (x < 0.40) we observe material with low defect density, small Urbach energy and high values of the ambipolar diffusion length. In the regime of high Ge content (x > 0.40) the defect densities and Urbach energies are high and the values of the ambipolar diffusion length low. The transition is accompanied by the appearance of a low-temperature peak in hydrogen effusion experiments indicating a void rich film structure. Material from just above and below the transition zone is used in pin solar cells leading to a much enhanced red response compared with a-Si:H cells. The differences seen in the material quality are mirrored in the solar cell properties. By carefully adjusting the active layer thickness material with low diffusion length shows also reasonable solar cell performance.