THE KEY FUTURE SILVER PRICE FACTOR: Investment Demand, Not Solar
by Steve St. Angelo, SRSrocco Report There seems to be a great deal of hype put forth by the market that rising solar demand will be a key factor in determining the price of silver in the future. While silver consumption in the solar industry may increase going forward, the real cause for much higher silver prices will be investment demand. Why? Because the actual data proves investment demand is the largest growth sector in the silver market. I’ll get to the figures in a moment. But, before I do that, let’s discuss the supposed wonders of solar photovoltaics. Unfortunately, people continue to believe that high-tech gadgets and renewable energy will save us from the impact of peak oil. Basically, as Jim Kunstler states over and over, “Americans want another way to continue running Wal-Mart, Walt Disney World and the Interstate Highway System.” I am not saying this isn’t a worthwhile thing to do, but the study of the EROI – Energy Returned On Invested proves IT CHAIN’T GONNA HAPPEN. Of course, a lot of intellectuals would disagree as they continue to push for more renewables, but they fail to comprehend the simple math called EROI. However, we can’t blame them as there is a great deal of what I call collective brain damage taking place here in the good ole US of A and abroad. You see, evidence is finally coming out that confirms solar power isn’t the energy savior we once thought. Charles Hall, one of the leading experts on the study of the EROI and Pedro Prieto wrote a book titled, Spain’s Solar Revolution: The Energy Returned On Invested. I haven’t yet read the book, but read a review by EnergySkeptic.com website. Now, if a person had an open mind (rare these days) and could invest ten minutes reading the article, they would realize without a doubt… Spain’s solar industry is a financial disaster. According to the article:
To kick start the solar revolution, the Spanish government promised massive subsidies to solar PV providers at 5.75 times the cost of fossil fuel generated electricity for 25 years (about a 20% profit), and 4.6 times as much after that. Eventually it was hoped that solar power would be as cheap as power generated by fossil fuels. ….. The end result was a massive transfer of public wealth to private solar PV investors of about $2.33 billion euros per year, and businesses that depended on cheap electricity threatened to leave Spain. Despite these measures, the government is still spending about $10.5 billion a year on renewable energy subsidies, and the Spanish government has had many lawsuits brought against them for lowering subsidies and profit margins. Solar companies went bankrupt after the financial crash, including the Chinese company Suntech, which sold 40% of its product to Spain. About 44,000 of the nation’s 57,900 PV installations are almost bankrupt, and companies continue to fail (Cel Celis), or lay off many employees (Spanish photovoltaic module manufacturer T-Solar).
You see, a great deal of solar panel demand was due to the huge government subsidies in countries such as Spain, Germany and the United States. And as the article above states, 44,000 of Spain’s 57,000 PV installations are almost bankrupt. This really isn’t surprising as Germany is dealing with the same issues as is Spain. I wrote about this in my article last year titled, GERMANY: Renewable Energy Policy “Complete Failure”… Bring On The Dirty Coal Monsters:
In a stunning admission, the German Government recently announced that its transition to Renewable Energy was, “On the Verge of Failure.” This blunt statement was released by Germany’s Economic Minister and Vice Chancellor to Angela Merkel, Sigmar Gabriel at an event at SMA Solar… Germany’s leading manufacturer of Solar technology.