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Solar Silver Thrust, Soaring Demand from PV Panels: If Oil Skyrockets As FRN Collapses, Will We Only Be Able To Afford The SUN?!

By Jeff Clark, on the MarketOracle (10/05/2012):

Solar Silver Thrust, Soaring Demand from PV Panels

"As you may know, silver is used in photovoltaic (PV) technology to generate solar power. A typical solar panel uses a fair amount of the metal – roughly two-thirds of an ounce (20 grams). To put that in perspective, a cellphone contains around 200 to 300 milligrams (a milligram weighs about as much as a grain of sand). A laptop contains 750 milligrams to 1.25 grams.

Photovoltaic technology is relatively young, but each year its use is growing rapidly. Just since 2000, the amount of silver consumed by solar-panel makers has risen an average of 50% per year. Demand grew from one million ounces in 2002 to 60 million ounces in 2011. Last year demand from the PV industry represented almost 11% of total industrial demand for the metal (excluding jewelry). According to statistics from CPM Group, demand grew by 11.2 million ounces, the strongest volume growth of all major sources (jewelry and electronics). And this was before the Japanese announcement was made...


(emphasis mine)

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You can't make an deliver PV panels without energy from oil.

The most important thing to consider in alternative energy is the amount of energy expended to acquire it compared to the amount of energy it produces over its lifetime. This is Energy Return on Energy Invested.

Oil is our most concentrated source of energy. It is a bell weather.

Today we get back 100 barrels of oil by spending the equivalent of the energy in 11 barrels of oil, leaving 89 barrels to fuel the economy. In 1930 we got back 100 barrels of oil by spending the equivalent of the energy in 1 barrel of oil. This cost has been following a compound growth curve, growing at about 3% per year. In 23 more years we will spend 22 barrels to get 100 (this is disaster). In 47 more years we will spend 44 barrels to get 100 leaving 56 to fuel what is left of the economy. This is because of the low hanging fruit principle which simply describes that we acquire the easiest to find, cheapest, most profitable, cleanest, most proximate deposits and leave the undesirable deposits for later, only later is now.

For solar to replace oil, it would need to have as great a return on energy invested as oil does today, but it doesn't. It doesn't even come close. It is marginal. So this article is simply delusional. If it wasn't subsidized by government, nobody in his right mind would consider it.

With the current return rates for oil, there is not sufficient energy to keep the economy expanding. As a society we have reached the point in the oil acquisition cost curve where we can no longer afford luxuries, higher education, advanced health care, and centralized government. These will collapse as energy costs continue to increase. All we will be able to afford is the most basic of needs like food, shelter, and minimum localized government, and those will become increasingly unaffordable too as we progress along the compound cost curves for each energy source. We certainly won't be able to afford boondoggles like PV panels; there simply isn't sufficient extra energy today to invest in anything that won't adequately replace oil, and government efforts to force us to buy these things or health care, or support a doomed federal government will only hasten the collapse of our industrial civilization.

Learn 17th century farming techniques because that is where we are headed, if we are lucky.

"Bend over and grab your ankles" should be etched in stone at the entrance to every government building and every government office.

That's quite a negative outlook you got there

For someone that appears to understand all the important concepts involved, you don't give much credit to new innovation. Here's a few pieces of info you seem to have missed.

Energy: Large scale wind has a 20:1 EROEI and oil is down to 8:1. PV solar has multiple technologies that each range from 6:1 up to 30:1. (Some of the higher ones unfortunately rely on scarce raw materials though) Ethanol is a total loser at 1.5:1. CSP solar ranges from 20:1 up to 200+:1. Biodiesel from the latest (non-commercialized so far) sources is topping 30:1 with much higher gains very likely.

However, since these are 'up-front' technologies where you spend all your money and energy before you get any return, they're fighting an uphill battle in the financing. This is a major reason you aren't seeing ANY of the new technology going commercial just yet. It simply doesn't work with today's finance structure of compounding the interest forever. The other problem is that institutional investment of all types is locked into the opinions of the entrenched energy experts. If BP says CSP isn't a good deal, CSP is going nowhere fast, period, end of story. They have complete control over the investment direction. Because of this manipulation that's taken place for 2+ decades and the stalled economy of the last 5 years, your exponential growth curve has a cumulative error. In short, we've passed oil production's peak in '05 and are farther over the cliff than most people estimate.

This means that your 'business as usual' timeline is probably too optimistic. EROEI kills any fuel source off at a level below 2:1, not 1:1 as most people think. To understand that, consider the economics side. Watch Chris Martensen's presentation posted below or take his online classes to see how we've extended conventional oil's production peak and placed too much emphasis on 'tight oil' that's unproven and even unfound and has an EROEI of less than 3.

Food: We certainly don't need to go back to the 17th century techniques for growing food. We know too much about the food chain interdependency to do that. Take a peek sometime at those youtubes where guys are growing 300,000 lbs of produce and 50,000 lbs of fish on a single acre in a near-zero energy process. Then go look at the 7 layer high permaculture systems where the yield is also over 30,000 lbs of many many different crops per acre with a system that only requires harvest, not maintenance.

Economy: The fiat and fractional reserve banking systems are the ONLY reason our economy needs to grow perpetually or at all. Without those, it is very prosperous to have flat or even declining economies. The reason is that people get to keep their savings and that eliminates much of the future income they would have otherwise required. This snowballs the savings as less commuting and other work related expenses ($ and energy) are needed because the economy isn't so huge. So all we have to do is weed out the non-productive aspects of society and things will become self correcting. Fortunately, with a good plan on the above and more, they will also be the first to die off from the crash.

So yes, things will get tight and so much will change but that doesn't have to mean stone age living and mad max policies.

PS: See if you can find the step in all of the above where we can jump in to break the catch-22.

Each energy source has its own cost curve, and they are all

increasing at a compound rate. This makes them all eventually impossible to continue. I can't tell you how many years I have heard that we have plenty of oil much of it too expensive to obtain at the current price, but when the price goes up it will be profitable; only then when the price goes up the cost also goes up, so there it sits, just as unobtainable as before. This is the receding horizon problem.

But let me address some of the alternatives you are claiming will rescue us from the dark future I see coming. Wind may have a 20:1 EROEI at the windmill, but considering the energy that must be expended to create the infrastructure to deliver it, it becomes far lower than the number you cite. And consider that it is an intermittent source, depending on the wind speed so it can't be the primary source of electric generation. There must be back up or else delivery of electricity becomes intermittent. So when you factor in the energy expended on the delivery infrastructure and the backup facilities, it becomes a paper tiger. No help from wind except at the margins, and certainly not a replacement for oil.

CSP solar has about the same cost structure as natural gas, but is better that PV solar. That isn't saying much since natural gas is only about 10:1 at the well head, and very marginal at the delivery gates, primarily because of the difficulty of transporting and controlling a gas.

The sun's energy arrives in a disbursed fashion. The only way to use it is to concentrate it. It was concentrated by nature over billions of years in fossil fuels, which are finite. Any efforts to concentrate it as it arrives I think will fall short. A few might work in limited areas, but are not scalable. Every effort to concentrate it will be limited by the cost of concentrating it, and in reality all this technology depends on fossil fuels to create the tools to do the concentrating; when fossil fuels are too expensive, so will be the concentrators. You can't tell me that biodiesel can have a 30:1 EROEI because it is a low tech process relying on nature for the most part, using plant material, to do the concentrating. It is just impossible for it to be anything but marginal after the cost to pump up the natural process.

It's all about burning to keep the industrial age churning out goodies, and we have passed the limits and are at the door of hell. As far as the 2:1 limit before an energy source becomes a sink, I think the number is between 5:1 and 8:1 depending on whose study you read.

Here is an interesting article on the time table for the demise of oil which takes into account total production, rising cost, and declining energy density. The energy density problem is not often addressed since we count total production and really don't consider that each barrel is not the same. Light sweet crude is high density; the tight oil we are now getting out of the fracking wells is low density. This is because the longer chain hydrocarbons that make up deposits of light sweet crude won't fit in rocks like the short chain ones that we get as tight oil. So while total production may have leveled off, we are substituting barrels of low density tight oil, or barrels of hard to refine heavy oil to make up for the depletion of light sweet crude, all the while cost to acquire are rising exponentially.


"Bend over and grab your ankles" should be etched in stone at the entrance to every government building and every government office.

Thnx but you're missing some info

Thank you very much for your intelligent and discerning response. I would completely agree with every word, except that I am in a very unique position to know otherwise. Now I have to show my cards some to justify that statement.

I invented a new Stirling engine process about a decade ago. In trying to bring it to market, I have been exposed to technologies and solutions that, IMHO, no one else knows of. Here's the short version:

I started focusing on CSP as a method of providing it heat. I went investor/grant/subsidy hunting. Unfortunately, being a free marketer and violently against yielding control, I met with much frustration. I started a company and advertised that we will investigate and consider funding all types of innovative renewables. This got me into nearly a hundred NDA agreements on varying technologies that are in a similar funding situation. So, while I can't outline any specifics in detail, I can give a rough overview.

In no particular order... Algae biofuels currently depend on growing a single strain to conform to a single process of refinement but there exists an even cheaper process to refine all types of algae into perfectly standardized gasoline. This means that algae farms can increase yield by nearly 80 times since they no longer fear cross contamination.

My solar system and a couple other approaching competitor is storing sunlight in the form of heat to be used on demand. My advantage is the ability to store day's worth, not just 6 hours. It is also capable of home scale to commercial scale sizing.

My solar concentrators, storage systems and engings are designed around aluminum, salt, glass, some steel and lots of heat. My factories can eventually provide all that heat from, you guessed it, solar concentration. We even have a glass plant based on solar concentration. (glass is mostly sand) Aluminum (and a little copper for the generator) is the only resource that's not sustainable but it is recyclable and very abundant. I also have an ocean based configuration which has two important by-products. Desalinated water and salt, which can be used in the utility scale solar thermal storage.

Wind turbines are not very sustainable in their current configuration. However, picture an array of very efficient ones being flown like a kite in the jet stream. They will now have 95% capacity, be subject to 300 MPH wind on average and can be easily controlled to follow wind direction. Just 4% of the 'near jet stream', 'off limits' airspace in the northern midwest could power the entire country using this method. Estimated costs are under $200/kW, they scale very large and their EROEI is over 200:1.

Waste to energy using plasma gasification can turn landfill and sewage waste into energy and potable (cracked and recombined H2O) water so cheaply you wouldn't believe me if I quoted it. EROEI is still over 25:1.

Using a truly intelligent smart grid, we could utilize over 80% of our transmission capacity while reducing it's peak usage. As you know, line costs are based on peak capacity so that's a reduction in cost (or level one depending on how you figure it) with an increase of 4 times total energy transmitted. This doesn't eliminate the intermittancy problem but it spreads it to more than triple the geographical area which further cuts balancing costs. On the other side of the coin, this smart grid could usher in home renewable onsite generation just as easily as onsite demand reduction. Both of these can reduce our problems by varying amounts up to 40%. Likely is more around 10% though.

Your end premise, however, is very accurate. We definitely are all about creating materialistic 'goodies' for the 'kiddies'. This is a process we're also working on. (did I mention that we have potentially 16 companies in a form of consortium?) We have a strong focus on producing things that effectively last forever and new multi-function devices. These products (both ours and others we support/watch) all make 'local and long lasting' a choice that's easier because it's cheaper and has more benefits. We also promote private company ownership with no debt to be passed on. This ends the 'perpetual growth' paradigm so the incentive is gone to cut corners. As you might imagine, this last fact has caused us the longest delay in getting things rolling. ...but we are still winning, very soon.

We have an entire US energy plan (working on global) where we lay out the current sources and the future sources with all the above (and more) in play. If we did a very aggressive action and could push some innovative mass transit (skytran.net, et. al.), it could take us down to 10% oil (none foreign) and 10% current NG and the rest renewable in 10-15 years. Less aggressive approaches might to the same in 30 years but they allow for global integration. ...and all costs are less than status quo.

Nope. Not buying it

Don't fall for this fearmongering reporting. Silver use in industry is the LEVELING factor in its price, not a runaway freight train causing it to skyrocket uncontrollably.

Silver use in mirrors used to be primary, now they use vapor deposition of aluminum.

Silver use in electronics, predominantly mobile, is growing some but the recycling is too and the device consolidation is ramping up. (One device replaces 4)

Silver use in solar is only justified by a) the current relative high cost of the PV cells and b) the low cost of silver. Other conductors will be substituted with minimal losses for cheaper costs once performance wars settle some.

PV solar cells are nowhere near the efficiency of CSP solar which will dramatically overtake and virtually kill the market very soon.

All non-hospital antiseptic use will soon be seen for the super-bug creator that it is - hopefully.

Don't fall for this fear. Every high-content silver industrial use is in or will soon be in decline, in direct proportion to its cost. It is ONLY collector demand and the sub-genre of mega-banks deleveraging their paper, that will drive this market.

Cyril's picture

Well, I'd pray you be right.

Well, I'd pray you be right.

Indeed, solar panels AND the nuclear better become BOTH EXCEPTIONALLY CHEAP to produce (ideally, without requiring ANY silver for the former)... for the next 20 years and on, because you can just forget oil and/or ought to accept a much lower pace of life - coming to us (everybody) pretty soon:


Contains known figures and other figures the MSM really wasn't interested to advertise about...

"Cyril" pronounced "see real". I code stuff.


"To study and not think is a waste. To think and not study is dangerous." -- Confucius

I'm pretty sure on the solar side

since I'm building the technology myself. I have 3 solar records broken so far. :)

On the nuclear side, I wouldn't hold your breath for them though. There are simply too many problems with it. Starting with NIMBY, subsidized insurance and policy, then there's storage and danger fears, then there's real problems like scaling down to make waste heat rejection environmentally acceptable and concentrated transmission being overly subject to sabotage. It doesn't matter what technology they use, there's just no justification for wasting 2/3rds of the heat generated by any source.

Love Chris Martenson's series. I think it was 13 classes I saw 3-4 years ago and it really hit home with all the crises coming to a head together.

Cyril's picture



"Cyril" pronounced "see real". I code stuff.


"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Cyril's picture

I'm stacking on precious metals if only because of REAL monetary

I'm stacking on precious metals if only because of REAL monetary properties - portability, scarcity, recognizable, divisible, non perishable, physically very stable (gold a little more than silver).

I don't care about speculation / how precious metals compare to fiat money Ponzi schemes... although I have no doubts the latter will fall and the former will recall everybody what (real) money is about. Whether we have a little of it or more. Just a safety net, on my end, of course. Family head here.

I agree with your point my post makes the strong assumption silver would still be relevant should solar panels need to be produced "en masse" - which isn't as much of a given any longer, as you seem more informed than I am, granted.

But regarding oil... we've been lied to for decades, although not quite how we'd have (maybe) expected.

I would bet that most if not all today's western countries' societies are going to have to reconsider their living standards and way of life pretty soon and pretty significantly. Hence the even more critical importance to return to sound money if only to stop today's absurdity while we are still "comfortable"...

Tomorrow, if we stick to TWO "unsustainable" / "unfixable" (energy + monetary mess over failing economies) simultaneously, across the board, that'd really be ONE TOO MANY I'm afraid.

And even more important... to restore liberty.

"Cyril" pronounced "see real". I code stuff.


"To study and not think is a waste. To think and not study is dangerous." -- Confucius

If you follow my posts,

You'll find that I came to those same conclusions a couple years ago. I then worked the entire problem (all the crises together) backward to a solution. Fortunately, the solution is centered around liberty, sound money and pretty much everything DP members already promote. We just have to approach it from the other end of the tunnel. I even wrote a book on it (PM me if interested) and am building a massive business plan around it.

Oh, and fyi, solar is the new game but it's not in PV.

My stacking? HA! None here. Not because I don't want to but every dime I get and can scrape up from others is going into development and for plane tickets to send people all over the globe to schmooze investors. I couldn't afford a silver half dollar if I wanted. lol

Cyril's picture

I'll very likely be interested.

I'll very likely be interested.

The making of energy is anything but certainly NOT my domain. I'll be very glad to discover.

I'll PM you when I know I have the time to read and grok that thoroughly enough.

A bit worried, though (and not meaning to debase your idea I don't even know about yet anyway):

is the sound money aspect a strong requirement for implementation / push to the markets?

Because if it is, ... well, you see what I mean - still not exactly a piece of cake to deal and be done with, as we know :(

That's what p*sses me off the most in this banksters and planner leeches-ruled world - the brakes and derived burden on innovation they've had likely forced onto us by now, after 1913, and then 1971, are no doubts absolutely tremendous beyond our craziest nightmares. That's REVOLTING to know we're still enslaved by governments and/or TPTB at a time where universal knowledge itself can technically be disseminated for (still) cheap.

The 16th, 17th, 18th centuries thinkers who all dreamed of our "information age", more or less, to this or that extent, MUST BE turning in their graves today - seeing how TPTB uses our technology to DUMB DOWN and ENSLAVE the peoples. And RAPE them, their sweat, their dreams.

Oh well. Sorry for the rant.

Hey, I might very well be interested to invest a chunk of my real money stack in your idea if it's revolutionary, who knows? ;-) 'just 'hoping you'd keep some of it and NOT turn all of it into fiat/fake monopoly money that is barely worth enough to burn in the fireplace ;-)

"Cyril" pronounced "see real". I code stuff.


"To study and not think is a waste. To think and not study is dangerous." -- Confucius

Stack it.

I know they have aces up their sleeves and rabbits in their hats, but those aces and rabbits are not made of silver. One day, and I think soon, a silver chicken is coming home to roost.

Love or fear? Choose again with every breath.