We appear to be entering a golden age of solar energy, and even in this golden age, there could be a major silver lining. Silver is an essential component of the technology utilized by the solar power industry.

According to the solar advocacy group Understand Solar, silver has the highest electrical and thermal conductivity of any metal. This is why silver is used to make silver paste, which is what’s actually responsible for conducting electricity out of solar cells.

It’s for this reason that silver could potentially become one of the most sought after — and most expensive — precious metals in the world.

The growth currently being experienced in the solar industry, and the industry’s reliance on silver, has some analysts predicting the value of the metal will continue to rise as the number of solar panels continues to grow.

Projected Growth

Solar growth in the United States has been on a steady, increasing trajectory for a number of years now. The benefits to homeowners and to businesses have grown accordingly. Meanwhile, the price of panel manufacturing and installation has decreased as the U.S. market has continued to lead the way in growth.

The U.S. however, may soon face competition from abroad as the governments in China and Japan are putting considerable effort into adding solar energy to their own respective energy portfolios. If either country follows through on their plans — with China adding 35 gigawatts and Japan adding 5 gigawatts (and becoming the world’s largest solar market),the opportunity for profit-taking on commodities like silver will continue to grow.

Diminishing Return?

So if silver — a precious metal — is becoming even more precious because of its usefulness in solar energy systems, is there a risk that silver will become rare enough to reach the price levels of gold or platinum? Analysts say it’s possible, but it’s not a concern in the immediate future.

Silver currently hovers in the $10-$20 per ounce range, although at least one analyst is pointing to a $100 per ounce price in the future. However, even if the price of silver does continue to rise, there’s absolutely no indication that the price of solar energy systems will follow suit. In fact, there could be another silver lining.

As the price of materials increase, solar companies will need to look for ways to make their systems more efficient with the components and metals involved in the solar panel creation process. Over time, this could increase production, collection, and storage capabilities in ways that will make solar even more competitive than it is today.

Solar energy systems are here to stay. The solar market is growing at a pace that has already seen it overtake wind and hydro to become the leading source of renewable energy in states like California. And now it seems that while solar power continues to boom, silver may wind up coming along for the ride.

Curious about residential solar and how installing solar panels could potentially help you reduce your monthly energy bill? Contact us today for a free quote.