Researchers at Germany's Fraunhofer Institute for Solar Energy (Fraunhofer ISE) and the Institute of Environmental Sciences (CML) in the Netherlands have conducted risk-based due diligence on the silver supply for the PV industry, in order to identify possible shortages in the future.
“Considering the current typical lead times of the mining industry and the constraints such as permitting and environmental, social, and governance (ESG) issues linked to mine expansion, it is clear that material bottlenecks of unknown duration are in the cards,” researcher Estelle Gervais told pv magazine. “Supply disruptions can therefore be expected for silver, as they can be expected for numerous other materials required in energy technologies, including copper.”
She said that the silver industry has historically been resilient to these challenges because of strategic stocks and recycling, which have played key roles during periods of undersupply over the last 50 years. Silver reserves have also not significantly decreased relative to production over time, which suggests that exhausted reserves have been replenished through mine expansion.
“This is at least a cautiously optimistic sign for the medium to long-term,” said Gervais. “Estimates of future supply are linked to high uncertainty. We could, however, identify concrete risks related to market concentration and ESG issues in silver supply chains, which could translate into supply constraints in the short term. This is especially true for PV markets like the EU and the USA, which are increasingly working towards supply security and sustainability.”
Gervais and her colleagues mapped the solar supply chain of silver from 1995 to 2021 and identified a series of supply patterns and risks. They also analyzed the impact of alternative supply routes and the reshoring PV manufacturing to Europe.
The research group said that most ESG risks from silver paste fabrication are in China, due to its market dominance. The researchers said Mexico and China account for most ESG risks in mining and refining. They also noted the need to prioritize due diligence and traceability with local players, as ESG risk monitoring becomes the norm.
“Reducing silver consumption in PV is crucial, both to alleviate the silver price pain point and reduce the environmental and social impacts along the supply chain,” Gervais said, in reference to the ability of PV producers to reduce silver content in solar cell production – a process referred to as thrifting. “Silver prices are however both a problem and part of the solution. They will play a role in bringing supply and demand into balance, and provide an incentive for PV recycling.”
Gervais said that prolongated periods of silver undersupply could be a clear deterrent for the PV industry and would intensify the focus on substitutes.
“Copper prices make it a great alternative to silver in PV and there have been considerable technological advances in this area,” Gervais added. “Copper contact paste development for screen printing is advancing and industrial manufacturing solutions for copper plating are available. It should nevertheless be underlined that switching from silver to copper will not automatically ensure PV manufacturers have a ‘sustainable' product. Not all copper is created equal: only a careful examination of the underlying copper supply chains and a diversified supply would support that.”
Gervais and her team presented their findings in “Risk-based due diligence in supply chains: The case of silver for photovoltaics,” which was recently published in Resources, Conservation and Recycling.
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