Hotly watched ASX-listed explorer Sun Silver (ASX:SS1) has announced it has applied for a US$60M (A$90M) grant from the US government’s Department of Energy (DoE) to develop solar panel materials on Tuesday.
In fact, the company is doing more than that – it’s looking to build its own silver paste production facility within the US, thanks to the help of the environmentally-conscious (and critical minerals-focused) Biden administration.
The money if granted will ultimately let Sun Silver greatly assist the US broadly in the production of solar panel PV cells in America, for America – a long sought-after capability, currently the remit of Chinese manufacturers.
Sun Silver said on Tuesday that a successful application will only help boost the US economy by providing jobs to workers in a specialised field, as well as helping the nation secure its renewable energy goals at a time where supply chain weakness through COVID has left the world shocked out of a slumber globalisation afforded.
“We are excited to pursue our application with the U.S. Department of Energy for our Silver Paste Production facility,” Sun Silver Executive Director (ED) Gerard O’Donovan said.
“Locally produced silver paste is crucial for supporting America’s ambitious solar energy targets.
“This initiative aligns with our commitment to advancing sustainable energy solutions, running in parallel to the development of our globally significant Maverick Springs silver asset.”
The grant funding would award Sun Silver a 30% investment tax credit (ITC) within the states, a compelling lure for companies to assist the country build-out its domestic renewables industry capacity. It’s well and good to say more solar and wind, but you need the industries in place ready to make them at home.
Sun Silver’s application to the US government for the funding also comes at the same time the US has moved to impose a 50% tariff on solar cells, made in China, coming into the US. Green tech has formed a fundamental part of the latest iteration in the US-China trade war that has increasingly become renewables focused (as well as microchips.)
Sweetening the deal further is that Sun Silver reports 30% of the USA’s energy requirements by 2030 are already committed to solar power generation.
Silver is often forgotten in favor of copper as being the most conductive metal on earth, is an irreplaceable component of modern solar panels and new solar technologies are only requiring greater quantities of silver. It can also be used in microchips.
That’s where silver paste comes in. The paste – literally, a paste – is applied in thin layers that ultimately help boost the flow of electricity between the panels and then down the wire to storage assets, thus making solar panels a viable energy generation technology.
But Tuesday’s announcement couldn’t have been made without recent climate-minded energy sector law reforms in the USA.
In the United States, Joe Biden’s Inflation Reduction Act (IRA) has fundamentally reshaped the renewables landscape – providing myriad opportunities to companies such as Sun Silver in a position to help develop the nation-state’s domestic renewables production capacity.
For the country to make its own solar panels without needing to ask China for help, the US needs to be able to make its own silver paste. Thus, the initiative by Sun Silver..
The grant application doesn’t come from a vacuum. Back in late May, the company confirmed it had booked specialist firm Holland & Knight to assist with its application to the US government.
“The USA is currently in the midst of a perfect storm when it comes to solar energy, due to key government initiatives and policy shifts,” Sun Silver ED Gerard O’Donovan said in late May.
The company is ultimately seeking to align itself with one of the strategic outcomes desired by the USA at this current time – domestic manufacture of silver paste.
An existing mineral resource of an eyebrow-raising 292M ounces AgEq is, without doubt, a very attractive proposition alongside the Silver Paste story.. The plant will be located 85km away from the company’s flagship Maverick Springs play in Elko County, Nevada.
“Elko County’s well-developed infrastructure, supported by a population of over 20,000, ensures year-round access to a local skilled workforce,” the company wrote on Tuesday.
The move comes at a time when silver prices have seen significant upside through 2024 YTD.
Year on year, the price of the precious metal is up 30% to US$29.50/oz. Sticking to that YoY timeframe, silver has actually outperformed gold since June 2023.
Silver is often forgotten as an industrial metal with a wide range of uses in manufacturing and hi-tech applications – including, of course, solar panels. Central banks have also been buying silver through 2024 as a complement to metals storing strategies.