Solar remains the leading ‘green’ demand source for silver for the next few years, according to a new report ‘The Role of Silver in the Green Revolution’ by The Silver Institute and CRU. (Source: CRU)

With the PV industry growing by leaps and bounds and the trend expected to continue, the silver industry can look forward to continued high demand from this sector. A new report ‘The Role of Silver in the Green Revolution’ by The Silver Institute estimates that roughly 820 million ounces (Moz) will be used by solar energy applications through 2030. That’s more than half of the over 1.5 billion ounces of silver to be consumed in crucial green technologies through 2030.

Consultancy CRU that has authored the report on behalf of The Silver Institute does warn that even though solar power will account for a growing share of global electricity generation, the use of silver per PV cell is likely to decline. Technological advancements have led to several changes in the shape, size and materials used in a conventional solar cell, ensuring the use of silver comes down.

CRU expects silver loading in solar PV to continue to decline through 2030, though at a slower pace. “Ultimately this will lead to short term growth in silver demand in PV from 2018-2020, before thrifting and a reduced amount of PV capacity installed per year causes a decline in demand through the early 2020s, after which we expect demand to return to growth from 2025 onwards,” write the authors.

Blaming the practice of ‘thrifting’ (slower market growth than material optimization per unit) for this phenomenon, CRU believes that annual silver demand in PV cells will range around 70-80 million ounces in the next few years, before declining to approximately 50-55 million ounces in the mid-2020s. “We expect that it will then return to growth, reaching 66 million ounces by 2030,” it said. CRU believes that 2017 represented a probable peak for silver demand in the PV industry, but a deceleration in thrifting and continued additions to solar generation capacity will further support silver consumption, particularly in the longer term.

When looking at silver usage per cell, according to the report the rate of silver reduction is beginning to slow. After having fallen from 400 mg to 130 mg per cell between 2009 and 2016, CRU forecasts silver content to begin levelling out at 65 mg around 2028. On a mg/W basis, CRU sees consumption per W decreasing from around 22 mg/W in 2017 to 10.5 mg/W in 2030. The leading paste manufacturers are indeed quickly improving their products to reduce silver consumption in cell production, as the recent TaiyangNews Market Survey on Metallization Pastes 2018 shows. In an interview with TaiyangNews, Heraeus Photovoltaics CTO Weiming Zhang said, that he expects average metallization paste usage will reach the 75 mg/cell level already in 2020, compared to 100-105 mg/cell in 2017 (see Beyond Silver Supply Strategy).

The main driver for thrifting has been the price of silver, according to the report. When silver prices more than doubled between 2009 and2011, the amount of silver in the average PV cell halved from 4.0g to 2.5g. The rate of thrifting then halved between 2012 and 2017 as the price of silver fell from U.S.$31 to U.S.$17 per ounce. CRU forecasts that ‘the price of silver is unlikely to rebound to the record-high levels reached in 2011, playing a role in the decelerating rate at which thrifting is expected to continue, which is typical for commodities markets’ (see graph).

CRU also points to potential substitution for silver in solar applications. “As in other applications, there is also a modest risk that silver may be substituted (in solar) with less expensive materials, such as copper.However, substitute materials have had difficulty competing. Silver has the lowest electrical resistance among all metals at standard temperatures, meaning its substitutes cannot hope to match it in terms of energy output per panel; the savings made in substitution may therefore be offset by the increased number of panels needed to match capacity,” CRU said. Adding, “that’s why non-silver PVs tend to be less reliable and have shorter lifespans, meaning they are some way off in terms of commercial development and are unlikely to gain significant market share between now and 2030 as the broader market heads toward more compact and efficient solar panel equipment.”

In April, The Silver Institute reported in the World Silver Survey that silver demand from solar grew to a record high of 94.1 million ounces (Moz), equal to 2,926 tons in 2017 (see PV Industry Needed 19% More Silver In 2017).

‘The Role of Silver in the Green Revolution’ report is available on the website of The Silver Institute.