Strategies for electric vehicle charging to reduce peak power demand and store solar energy.
(Nikkei Asia, March 24, 2023)
The Taiwanese government is cleaning silt from the Tsengwen Reservoir while the water level is extremely low. (Photo courtesy of Taiwan’s Water Resources Agency)
Taiwan, home to Asia’s biggest semiconductor industry, is once again bracing for water shortages less than two years after overcoming its worst drought in a century. Chipmaking is a thirsty business. Take Taiwan Semiconductor Manufacturing Co., the world’s biggest contract chipmaker, for example. Its chip facilities in the Southern Taiwan Science Park alone consume 99,000 tonnes of water per day, according to the company’s latest figures. And as chip production techniques become more advanced, their water needs grow. In addition, the island relies heavily on seasonal rainfall to fill its reservoirs — and climate change has made this a less reliable option. This year, cities have already started preparing for constraints.
Such moves are aimed at avoiding a repeat of 2021, when drought was so severe that it disrupted manufacturing and agricultural activities across the island. Manufacturers like TSMC resorted to rented water tanks and newly drilled wells to keep factories running at a time when the world was counting on Taiwan to ease an unprecedented chip shortage. Keeping the supply of chips flowing is not just an economic imperative for Taiwan. Being a vital source of semiconductors makes the island politically important for allies such as the U.S. in the face of Chinese aggression. If Taiwan’s chip output is dented, its “silicon shield” could also weaken.
Wu Ray-shyan, executive vice president of the National Central University and a hydrology and water resources expert, says water is a big challenge for Taiwan’s longer-term economic growth. “Climate change is real and we are seeing dramatic changes in rainfall every year,” he said. Ironically, the island’s strategic importance as a chipmaking hub is exacerbating the problem of chronic water shortages. “The pressure on water and energy supplies that Taiwan faces is much bigger than a couple of years ago,” Wu said. “We didn’t expect there would be so many Taiwanese suppliers coming back to the island to invest [amid the U.S.-China trade war]. … At least I didn’t calculate this factor in my forecasting model.”
