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Silver in Photovoltaics 2012

Nano-521

Published March 2012 NanoMarkets, LC

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Silver in Photovoltaics 2012

SUMMARY
Silver in Photovoltaics 2012 is the latest report from NanoMarkets in our ongoing coverage of materials and markets in the photovoltaics sector. In this report, NanoMarkets examines the changing opportunities for silver materials in the dynamic PV industry. The report is designed to help silver suppliers to understand how changes in the PV industry will influence their sales. It considers how suppliers of silver materials to the PV industry can hold onto market share under the difficult circumstances that PV faces today: rapidly falling panel prices, huge pressures to continually reduce costs, and government subsidies under threat. It also considers these challenges in light of silvers historically high and likely to stay high commodity price. Taking into account these new dynamics, NanoMarkets identifies the considerable opportunities that are still available for silver in the PV sector and covers both conventional crystalline silicon PV and PV based on thin-film silicon, CdTe, CIGS, OPV, and DSC. The report includes coverage of established silver pastes and inks as well as newer materials based on nanomaterials, including the latest transparent nanosilverbased electrodes. It also examines alternative scenarios for silver in PV and provides an in depth discussion of materials challenges to silver in the PV sector, especially those presented by the use of copper and aluminum. As with all NanoMarkets reports, this report contains detailed eight-year forecasts of the silver usage in the PV sector broken out by PV technology and how the silver is used within the PV cell itself. The forecasts are provided in both value and volume (ounces) terms. In addition, the report discusses the strategies of key firms to watch in this important sector.

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TABLE OF CONTENTS
Executive Summary E.1 Changes in the PV Market for Silver Since the Last Report E.1.1 Cost Pressures in PV E.1.2 Shrinking Subsidies for PV E.2 The c-Si PV Market E.2.1 Front-Side Grids in c-Si PV A Key Market with Few Alternatives E.2.2 Competition for Silver in Backside Electrodes and Tabbing E.3 Shrinking Share of c-Si PV and the Rise of TFPV E.4 Longer-Range Prospects for Nanosilver in PV E.5 Winners, Losers, and Firms to Watch E.6 Summary of Eight-Year Forecasts for Silver in PV

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www.nanomarkets.net Chapter One Background to this Report 1.1 Objectives and scope of this report 1.2 Methodology 1.3 Plan of this report Chapter Two Transparent Conductors used in PV Applications 2.1 Crystalline Silicon PV and Silver 2.1.1 Front-Side Electrodes and Silver Entrenchment 2.1.2 Other Silver Applications in c-Si PV: Back Electrodes and Tabbing 2.1.3 Lower-Cost Materials that Could Threaten Silver 2.2 Silver in Thin Film PV 2.2.1 Growing Market Share for TFPV and Impact on Silver Consumption 2.2.2 Silver in OPV and DSC PV 2.3 Emerging Opportunities for Silver 2.3.1 Nanosilver Transparent Electrodes 2.3.2 Nanosilver Inks for High-Resolution Printing 2.4 Key points in this chapter Chapter Three Eight-year forecasts of Silver in PV applications 3.1 Forecasting Methodology and Assumptions 3.1.1 Data Sources 3.1.2 Scope of the Forecast 3.1.3 Pricing Assumptions 3.1.4 Alternative Scenarios 3.2 Eight-Year Forecasts of Silver by PV Technology forecasts of Silver by PV technology 3.2.1 c-Si PV 3.2.2 Thin-Film Si PV 3.2.3 CdTe PV 3.2.4 CIGS PV 3.2.5 OPV 3.2.6 DSC PV 3.3 Eight-Year Forecasts by PV Cell Application 3.4 Eight-Year Forecasts by Silver Material 3.4.1 Silver Pastes and Inks Conventional vs. Nano-Inks 3.4.2 Transparent Nanosilver Electrodes Prospects for ITO and TCO Replacement 3.5 Summary of Eight-Year Forecasts Silver in PV applications 3.5.1 Summary by PV Technology 3.5.2 Summary by PV Cell Application 3.5.3 Summary by Silver Material

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Acronyms and abbreviations About the author

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RELATED REPORTS (click titles for additional details)

Silver Inks and Pastes Markets 2012 CIGS Photovoltaics Markets-2012 Transparent Conductors in Thin Film and Organic Photovoltaics-2012 Nanosilver Markets 2011 Silver Powders and Flakes - 2011 Dye Sensitized Cells: Materials, Applications and Opportunities 2011 Materials, Applications and Opportunities within Organic Photovoltaics - 2011

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Chapter One: Introduction to Silver in PV Applications

1.1 Whats New Since the Last Report?

The photovoltaics (PV) market has for the past several years been a big consumer of silver; in Page | 4 fact, it is now the single largest consumer of silver printing pastes, beating out even the big traditional markets like printed circuit boards and polymer thick-film membrane switches. Partly thanks to government subsidies, the solar industry has grown dramatically, including a significant growth spurt in 2010 followed by strong growth again in 2011, even in the midst of a worldwide recession. But NanoMarkets anticipates significant challenges to the status quo in the PV market in the coming decade. The PV sector as a whole is entering a period of flat or moderate growth in the next couple of years, the industry remains highly cost sensitive, and government subsidies are waning. Meanwhile, the ongoing shift in market share toward thin-film PV (TFPV) is changing the nature of the addressable market for silver materials in PV. Specifically, there is an ongoing shift in demand for silver in PV applications from market-dominant crystalline silicon (c-Si) PV, which uses large quantities of silver printing pastes for front electrodes, to TFPV that, in most cases, requires far less silver. There is some good news, however, and in this report we identify areas in which suppliers of silver-based materials have opportunities to expand their business. Most of the opportunities center on providing new silver-based products that help the panel makers reduce manufacturing costs. Examples are: new silver printing pastes with reduced silver loadings that do not sacrifice performance; new printable silver materials that enable the fabrication of finer resolution silver traces; and new nanosilver-based options that enable low-cost, solutionprocessable and/or printable fabrication of transparent front electrodes.
1.1.1 Changes in the PV Market That Affect Silver Consumption

First, the success of the PV industry is closely tied to the construction industry, which is still struggling in several important markets. According to a fairly recent issue of The Economist, there are a number of important countries where residential real estate is still overvalued, including Australia, Canada, France, Sweden, Spain and the U.K. And this slow construction growth affects the c-Si PV market the mostthe sector that today uses the largest quantities of silver materials. Second, governmental support in the form of consumer subsidies, tax breaks, and loan guarantees is under considerable challenge around the world, as governments look for ways to
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reduce budget deficits. We think that in most countries, many of the incentives that have supported the PV industry over the last several years will be reduced significantly. In some cases, subsidies are being supported with renewable energy mandates, but there are no guarantees that these mandates will be successful in achieving their goals in the long run. All of these factors could have very serious consequences for firms selling materials into the PV sector. Germany, currently one of the largest PV markets, recently announced sharp cuts in feed-in-tariffs (FITs) that support its PV industry. The ramifications of these cuts are not yet fully known, but when the Spanish government took this step a few years ago, the PV market in Spain declined by 75 percent. More to the point, the opportunities available for suppliers of silver and silver products into the PV space are highly dependent on policy considerations, which should be judged a significant risk factor in view of the current worldwide financial problems. In summary, silver materials suppliers are not going to have it especially easy in the near future, even though the end of subsidies could be good news in the long run, since it encourages market-oriented PV technologies (even if the near-term effects are certainly chilling). Finally, as noted above, c-Si PV is losing market share to TFPV technologies. This shift will occur gradually, rather than sharply, but it will happen nonetheless, and it will have a measurable, and negative, impact on the consumption of silver in PV. Optimistically, we think that these internal technology transitions in the PV industry will yield new opportunities for some firms that know where to look for them. So, for example, while suppliers of conventional silver printing pastes will feel the pinch, suppliers of new nanosilver-based transparent conductors may grow. And, in NanoMarkets' opinion, the opportunities can only get better over time, since with subsidies removed, firms are more likely to come up with innovative new types of solar panels with even more uncertain requirements.
1.1.2 The Effect of the High Price of Silver on Its Consumption in the PV Market

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Cost has always been important in PV applications; a central thesis, after all, is that PV can be a more eco-friendly alternative to carbon-based fuels. And PV technology has a way to go to meet its goal of cost parity with conventional energy generation technologies for on-grid applications. Note, for example, that the U.S. Department of Energy (DOE) claims that solar production costs must be under $50 per square meter, or less than 5 cents per watt, to be costeffective in distributed power and the utility-scale production of electricity. This inherent cost sensitivity in PV presents a problem for silver suppliers. Silver has always been an expensive metal and probably always will be. But the most obvious change in the silver
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inks/pastes market since our last report is the seemingly persistent high price of silver, with no relief in sight. Silver commodity prices have been pushed upward because of the uncertain global economic environment in which investors have shifted increasingly toward hard assets. Silver exchange-traded funds (ETFs) have accumulated large stores of silver in order to handle Page | 6 the increased demand for precious metal investments. At the time of this writing, silver prices have somewhat stabilized, but they have done so at a level nearly twice that of just two years ago (in inflation-adjusted dollars). And there are no good reasons to believe that the situation will change very much over the next five years or so. This development is not particularly good news for the silver materials suppliers, since their costs are largely determined by the price of silver, which is outside of their direct control. Among these negatives, however, there is at least one reason for optimism on the part of suppliers of silver materials to the PV industry. Silvers conductivity is unrivaled; this performance ensures that there is often no suitable substitute, which means that the demand for silver is quite price-inelastic. In fact, the high price of silver is now a fact of life for many electronics applications, including many PV-related ones. However, suppliers should not be complacent. High silver prices will induce PV firms to look for silver substitutes, and sustained high silver pricesover more than just a few months or few quarterswill give these substitutes a chance to take hold. Indeed, there are already important subsectors of the PV market where cheap non-silver alternatives are taking market share away from silver, namely backside electrodes/reflectors and tabbing pastes, just to name a few. Clearly, at least in some cases, there are alternatives to the use of pure silver that might not be as good as silver, but are good enough performance-wise, and much better than silver costwise.
1.1.3 So, Where is the Growth for Silver in the PV Market?

Despite the shifting priorities in the PV sector, falling panel prices, and high silver prices (indeed partially because of them), NanoMarkets expects that revenues from silver materials will remain substantial in a number of PV applications. In fact, the very specific needs of the PV industry will produce a fertile field for silver product development. PV of all kinds is very sensitive to materials costs, especially in the current era of collapsing solar panel costs. High and uncertain silver prices do lead silver materials suppliers to seek to create greater value in the hope of gaining better margins, or at least preserving their margins. And there is certainly room for innovation here. Therefore, in the next few years, the marketplace

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will welcome innovations aimed at reducing the costs associated with manufacturers bills of materials (BOMs): These innovations might include not only ways of making silver more effective as a conductorsuch as through the use of nanosilver inksbut also through ways of using Page | 7 less silver in conventional inks and pastes. Nanosilver-based transparent conductors promise to greatly reduce the costs associated with difficult and expensive transparent conductive oxide (TCO) deposition by enabling low-cost, facile, roll-to-roll (R2R) solution-based fabrication of PV. In addition, the PV industry is developing both novel cell architectures and new materials for the absorber layer, both of which could profoundly affect the materials that are used/required for electrodes and reflector layers. Consequently, new silver formulations are needed to match the new materials and devices on which they are applied.

The expected trajectories of the different PV sub-sectors and their impact on the silver business are quite different: Crystalline-Si PV: Crystalline-Si PV technologies today use the bulk of silver materials in three key applications within the cell: front-side grids, backside electrodes, and tabbing strips. We expect the c-Si PV sector to retain a strong position in the solar panel market, but expect growth rates in this sector to cool significantly. In c-Si PV, silver product suppliers will have to compete with cheaper, non-silver approaches that do not use silver at all, namely copper- and aluminum-based substitutes. The back electrode is already in the process of substituting silver with aluminum (or aluminum-silver) materials, since the back electrode is typically less demanding than the other cell parts that use silver. And printed silver tabbing strips are losing ground to much less expensive copper-based solders and printed copper materials. In these applications, the near-term opportunities for silver suppliers center around offering lower-cost, reduced-silver materials, such as silveraluminum products, instead of silver-only formulations, for example. There is also some good news in c-Si PV: First, silver printing pastes appear to be entrenched in front-side electrode/grid applications because high conductivity is of the utmost importance for maintaining high efficiencies, and there are few suitable alternatives to silver in this application.

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Second, there is increasing use of transparent conductive front electrodes in newand growingheterojunction with intrinsic thin-layer (HIT) cell technologies. Today, HIT cells and similar PV technologies use indium-tin-oxide (ITO) for the transparent conductor, but this market presents an important additional addressable market for Page | 8 new transparent conductor technologies, including those based on nanosilver.

Thin-film PV: TFPV is growing more rapidly than c-Si PV, and NanoMarkets expects TFPV to account for about one-fourth of the total PV market (on an energy generation basis) by the end of the forecast period. As noted above, from the perspective of silver suppliers, this shift is not especially good news, because TFPV uses much less silver than c-Si PV. First, we note that tabbing is virtually nonexistent in TFPV, since nearly all cells are monolithically interconnected on a common substrate. The front electrodes in TFPV are typically made using TCOs rather than fine silver fingers, although silver grids are sometimes applied on top of the transparent electrodes. While the quantities of silver used for TFPV are smaller than those used for c-Si PV, silver ink manufacturers have developed products specifically for these fine silver grids, which are both finer than those used in c-Si PV front electrodes and more difficult to adhere because of the underlying transparent conductors. Special ink formulations are produced to address these challenges. In back electrodes today, the largest TFPV technology, cadmium telluride (CdTe) PV, forgoes silver entirely in favor of a carbon-based paste containing copper. Copperindium-gallium-(di)selenide (CIGS) PV, on the other hand, uses molybdenum for the back electrode for most cells, for ease of sputtering directly on glass substrates and for good adhesion to the CIGS layer. But back electrodes in TFPV often act as both electrodes and reflectors, to send unabsorbed light back through the cells active layer for a second chance at absorption. Silver's superior reflectivity combined with its high conductivity makes it a natural choice for this role, and it has been used extensively. However, the cost pressures on both CIGS and CdTe PV have pushed strongly for substitution of other metalsmainly aluminumfor the reflector.

The importance of nanosilver to opportunities in the PV industry: As changes in the PV industry occur, namely the shift toward increasing TFPV, there is an important sub-trend that could at least partially offset the decline in conventional silver paste usage elsewhere in PV. Specifically, NanoMarkets believes that PV could be an important, and higher-margin, addressable market for nanosilver-based transparent conductive front electrodes.
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The emergence of flexible PV applicationskey to growth in organic PV (OPV), dye-sensitized solar cell (DSC) PV, and CIGS PVwill be particularly important to nanosilver-based transparent formulations, which carry the promise of improved flexibility at lower cost than conventional transparent conductive materials like ITO and the other TCOs that are currently used. Nanosilver-based transparent coatings could also enable reductions in manufacturing costs for Page | 9 production of low-end/low-cost disposable PV cells for use in the growing ubiquitous printed electronics industry. None of these opportunities should detract from the basic fact that opportunities for silver material firms in the PV industry are going to be a lot scarcer than they were in the past few years. NanoMarkets believes that sales of silver materials, mostly in the form of printing pastes and inks, to the PV industry are in slow but steady decline and will remain so for the whole of the period considered in this report. The decline in silver consumption will not be precipitous; firms that are already established in the PV sector will not see their PV businesses disappear overnight. However, it seems clear that silver firms can no longer count on the PV sector to provide new business revenues simply based on organic growth, and it also seems likely that materials suppliers will be required to dedicate more marketing money to the PV space. Unless they can prove significant performance advantages or vastly lowered costunlikely given the high price of silverit is likely that margins are going to decline for silver firms targeting the PV space. NanoMarkets believes that capitalizing on the opportunities will require a serious rethinking of how money is going to be made in silver materials for PV applications. A more active business development program is requiredone that is designed to convince PV players that costs can be reduced without turning to cheaper, non-silver alternativesand this case will be a difficult one to make.
1.2 Objectives and Scope of this Report

In this report, NanoMarkets examines the changing opportunities for silver materials in the dynamic PV industry. In the analysis, we consider the factors that affect the overall silver markets, such as the price of silver and the performance vs. cost characteristics of silver alternatives. We include an assessment of each of the major PV technologies, and the unique aspects of their silver usage and needs, as well as an assessment of the types of silver materials available or in development and how they could fit those needs. We are principally concerned with the silver materials themselves, but we also consider and discuss companies producing and developing TCs as well as the end-users in the various PV segments.
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The report is designed to help silver suppliers understand how changes in the PV industry will influence their sales. It considers how suppliers of silver materials to the PV industry can hold onto market share under the difficult circumstances that PV faces today: rapidly falling panel prices, huge pressures to continually reduce costs, and government subsidies under threat. It also considers these challenges in light of silvers historically highand likely to stay high Page | 10 commodity price. Taking into account these new dynamics, NanoMarkets identifies the considerable opportunities that are still available for silver in the PV sector and covers both conventional crystalline silicon PV and PV based on thin-film silicon, CdTe, CIGS, OPV, and DSC. The report includes coverage of established silver pastes and inks as well as newer materials based on nanomaterials, including the latest transparent nanosilver-based electrodes. It also examines alternative scenarios for silver in PV and provides an in-depth discussion of materials challenges to silver in the PV sector, especially those presented by the use of copper and aluminum. As with all NanoMarkets reports, this report contains detailed eight-year forecasts of silver usage in the PV sector broken out by PV technology and how the silver is used within the PV cell itself. The forecasts are provided in both value and volume (ounces) terms. In addition, the report discusses the strategies of key firms to watch in this important sector. The classes of silver materials that are used in PV applications are as follows: Conventional silver printing pastes and inks, Nanosilver inks and pastes, and Nanosilver-based transparent conductive coatings.

PV applications within the cell include: Front side electrode grids, Backside electrode/reflectors, Silver tabbing pastes, and Transparent conductive front electrodes.

PV end-use markets considered are:

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Crystalline Si PV, including single and multi-crystalline technologies, as well as new HIT cells and the like, CdTe PV, CIS/CIGS PV, Thin film Si PV, OPV, and DSC. Page | 11

Through a review of each of the various market segments, we show where new business revenues will be created in the next eight years, and we provide detailed eight-year market forecasts for the use of silver in PV applications broken out by material type, PV cell application, and PV technology. The forecasts are in terms of the silver consumed and in dollars of revenue. These forecasts are based on a foundation of NanoMarkets' forecasts of both the PV industry itself and the silver materials industries. These are further developed and customized with our extensive technical expertise concerning the physical and materials needs of PV manufacturing and products. This report is international in scope. The forecasts are worldwide forecasts and we have not been geographically selective in the firms that we have covered in the report or interviewed in order to collect information.
1.3 Methodology

This is the latest report from NanoMarkets that looks closely at materials used in the PV industry, which is a key area of expertise of NanoMarkets. The information for this report is derived from a variety of sources, but principally comes from primary sources, including NanoMarkets' ongoing interview program of entrepreneurs, business development and marketing managers, and technologists involved with photovoltaics, silver materials, and emerging electronics of all kinds. We also use information from secondary sources, such as relevant company and industry organization websites, commercial databases, trade press articles, technical literature, SEC filings and other corporate literature. Some background information for this report has been taken from the previous version of this report, Silver in Photovoltaics from 2010. In addition, some of the more recent market

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information in this report comes from our most recent reports on PV, silver, and transparent conductors: Transparent Conductors in Thin-Film and Organic PV from February 2012 Markets for Silver-Based Transparent Conductors from September 2011 Nanosilver Markets from August 2011 "Transparent Conductor Markets - 2011" from July 2011, and "Thin-Film Photovoltaics Materials Markets, 2011 and Beyond" from December 2010. Page | 12

Where information has been used in an earlier report, it has been reconsidered in light of current developments and updated accordingly. The basic forecasting approach is to identify and quantify the underlying photovoltaics markets, the silver materials needs, and the technological and market pressures that affect the mix of silver materials used in these markets. We consider the specific materials needs of the various PV technologies that are or can be served by silver, and the technological and market pressures that affect penetration of silver into the different PV markets. We also consider broader economic developments that impact PV and materials development and commercialization. This report on silver usage in PV forms part of a series of reports published by NanoMarkets covering new directions in the commercialization of PV and for materials used in PV applications. Other related areas covered by NanoMarkets' reports include analyses of the markets for silver and nanosilver in general, transparent conductors in general and in PV (nanosilver vs. ITO, alternative TCOs, and non-TCO types), and other materials markets for photovoltaics.
1.4 Plan of this Report

In Chapter Two, we examine the silver materials that are used in PV applications, including the advantages and disadvantages of silver vs. silver alternatives. The goal is to identify key opportunities for silver firms in PV. We pay particular attention to changes in the market over the last year, as well as anticipated trends over the next 18 months and beyond. As part of this analysis, and to illustrate important trends and developments, we briefly examine the focus and strategies of some of the key suppliers and end users of silver materials for PV applications. Chapter Three contains our eight-year forecasts for silver materials used in photovoltaics. Our forecasts are broken out by silver material, PV cell application, and by PV technology.
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