The production of silicon is hardly environmentally friendly [0]. There's also plenty of other materials included, and then there's chemicals required to produce the panels themselves. There's been a few incidents where PV producers have dumped waste straight into rivers and so on, but luckily they seem to be infrequent.

Recycling will, of course, bring the levels of waste down from old panels themselves, but we're still looking to replace a lot of fossil fuel-powered plants, and there's no way we'll get around the fact that we need more raw materials than we can obtain from recycling old panels. We'll also still get a lot of waste from the production of the new ones.

0: https://en.wikipedia.org/wiki/Silicon#Production