Silver Quietly Outshines Gold In The Solar Power Era
What’s going on here?
Silver has quietly outpaced gold this cycle, powered by record demand from solar panels and a tightening supply backdrop that’s turning the once-overlooked metal into a market favorite.
What does this mean?
Silver’s been on a tear since October 2023, with spot prices climbing from around $21 an ounce to over $54 in mid-November before giving back a small slice of those gains. Gold has risen too, but silver is once again showing its trademark turbocharged moves: during the 2008 to 2011 precious metals boom, the white metal soared more than 400%, versus gold’s roughly 170% increase. This latest leg higher accelerated after Donald Trump returned to the US presidency, fueling bets on easier monetary policy, more political pressure on the Federal Reserve, and fresh doubts about the long-term appeal of US assets like Treasuries. Gold is still the go-to haven, supported by strong central bank buying and hefty flows into gold exchange-traded funds (ETFs) and physical bars and coins. Silver picks up some of that haven demand, but its long-term pitch is increasingly about industrial use – especially in renewable energy technology.
Why should I care?
For markets: A green energy workhorse steps into the limelight.
Industrial buyers now dominate silver’s growth story. Data from the London Stock Exchange Group shows industrial demand rising from 644 million ounces in 2023 to about 689 million in 2024, with solar panel use jumping from around 192 million to 244 million ounces – up more than 150% from 2020 levels. Global solar installations totaled roughly 600 gigawatts in 2024, and the International Energy Agency reckons the world could add about 4,000 gigawatts of new capacity between 2024 and 2030. Analysts estimate that could mean roughly 150 million ounces of extra silver demand each year by 2030, with solar alone accounting for more than a tenth of today’s total physical demand. That strain is already biting: LSEG figures suggest the market deficit has ballooned from about 20 million ounces in 2023 to more than 500 million in 2024, implying that even if high prices cool jewelry demand, overall supply will struggle to keep up.
The bigger picture: Supply constraints meet the solar decade.
Most silver doesn’t come from standalone silver mines but as a byproduct of copper, lead, zinc, and gold production, so output depends more on those industries than on silver’s own price signals. Even with upbeat sentiment around metals like copper and gold, expanding mines takes years of permitting, investment, and construction, so producers can’t quickly dial up supply when prices spike. Industry forecasts cited in recent analysis point to global silver production slipping from around 944 million ounces this year to just over 900 million by 2030, as mine closures and aging deposits weigh on output. That sets up a striking contrast: gold keeps hogging the limelight as a store of value and jewelry metal, while silver is increasingly tied to structural growth in solar and other industrial uses. Put together, rising green demand and constrained supply could see silver play a much bigger role in the energy transition than today’s headlines would have you believe.