Email of the day
Comment of the Day

October 03 2012

Commentary by David Fuller

Email of the day

On solar power and silver:
"I hope you are both well.

"In recent audios, you have mentioned solar power as one of the more viable forms of alternative energy so I thought you and the Collective might be interested in this article, especially as precious metals season is upon us.

"Keep up the good work!"

David Fuller's view I am well, thanks, and I trust Eoin is also, having just addressed the MTA in Boston and with another speech at the Contrary Opinion Forum tomorrow morning. Feedback on these events would be welcomed.

Thanks also for the interesting article. Here is a brief sample on 'Price Factors':

During recent years, solar panels have become significantly less expensive and more end-user friendly. However, the fact that each panel contains a lot of silver can make it susceptible to large price fluctuations. If the silver price gets too high, manufacturers might seek alternatives, of course, but they can't easily eliminate use of the metal. And if the product gets too expensive, demand could fall. Companies are already looking for ways to reduce the amount of silver used in PV panels or to replace it with another element.

At the moment there are two main solar panel technologies on the market. The traditional one is "thick film," where silver is the main component. The other one is a less-expensive "thin-film" method which replaces silver with another material, cadmium telluride. The development of thin-film solar panels has picked up due to its lower price, but the technology is less effective. Thick film is more efficient in gathering energy from the sun, and this type of panel still prevails on the market. CPM reports that it accounted for roughly 91% of total installations last year, and analysts expect thick-film panels to maintain their dominance for at least the next several years. Further, both panel types use silver outside of the cell for reflectivity and other functions, so the odds of silver being eliminated from solar panels entirely are very low at this time.

For investors, this means that at least in the near term, the solar industry will continue to use silver-intensive technology, thus supporting growing industrial demand for the metal.

But that's not all, folks…

This is an interesting article from Casey Research and I now know more about silver. It remains a useful and versatile metal for which demand is increasing, but silver is not in short supply. Moreover, the world is not in danger of running out of any industrial commodity. However, in the case of precious metals, investment demand can have a big medium-term influence on price action.

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