TSMC's Expansion into Phoenix May Face Water Scarcity Issues, Raising Concerns Among Officials and Experts

According to a report from the Taiwanese Economic Daily News citing the Barron's financial weekly, the new TSMC factory in the northern part of Phoenix, USA, is located in a dry weather area. If TSMC builds a full six wafer fabs, the factory may require up to 49.33 million cubic meters of water per year, which is enough to supply 160,000 households. This has raised concerns among officials and experts as the Colorado River, from which 40% of Phoenix's water supply comes, has been experiencing a 40% decline in water levels due to a 20-year drought and water disputes between seven U.S. states.

TSMC is the world's largest semiconductor foundry and supplies chips to major tech companies such as Apple and Qualcomm. The company recently announced plans to invest $12 billion to build a semiconductor factory in Arizona. The factory is expected to start production in 2024 and will employ around 1,600 people.

As TSMC competes with its rival Intel, who also has a plant in the area, they may have to compete not only for market share but also for water. The situation highlights the complexity of "water politics" in Phoenix, which is likely more challenging for TSMC than in Taiwan.

It is important to consider the impact of water scarcity and its potential impact on semiconductor production. TSMC and other companies' investments in the US semiconductor industry may face not only technical challenges but also environmental challenges. It is crucial to monitor water management policies and regulations and to seek out environmentally-friendly solutions to ensure sustainable and responsible production processes. The demand for semiconductors is growing, and it is essential to balance the need for production with environmental sustainability to ensure the longevity of the industry.