Silver is the product of the naturally occuring Silver Ore that is located underground. It was added in the RedPower2 Mod. In order to mine it successfully, a stone pickaxe or better must be used. Just like any other ore, it can be macerated and/or smelted in a furnace to create silver ingots. Silver is used along with Nikolite to create Blue Alloy Ingots in an Alloy Furnace. It is also part of a more diamond efficient alternate recipe for IC2 Glass Fibre Cables. Silver is also used to make an Athame. With silver, you can craft the Silver Chest, which is part of the Iron Chests Mod.
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Alternate Silver Chest recipe