TAIPEI (Taiwan News) — Taiwan’s semiconductor industry faces mounting water supply challenges as the sector grows and climate change worsens, a new report warned.
The joint Research Institute for Democracy, Society and Emerging Technology and Environmental Rights Foundation report published Thursday highlighted several risks to Taiwan’s water and electricity supply. It notes that chip production consumes as much water daily as a medium-sized city, and demand is rising, requiring new solutions.
“Stakeholders across Taiwan are implementing innovative strategies to address resource challenges in the nation’s science parks,” the report stated. It added these include energy transition projects, grid updates, improvements to ensure a stable water supply, and others.
“Despite these measures, significant risks persist as the combined pressures of industrial expansion and climate change continue to strain resources,” the report stated.
Threats identified include prolonged droughts, slow build times for water recycling facilities, local governments’ capacities to expand sewer systems, and social resistance to the impacts of power grid upgrades. It noted that climate change worsens the situation.
It does this by affecting power generation efficiency, reducing reservoir capacity, and increasing industrial demand in water-scarce areas. The report’s authors recommended a mix of investment, regulation, and corporate and government-led action to address these issues.
Speaking to Nikkei Asia about the report, Democracy, Society and Emerging Technology Policy Analyst Chang Chen-yen (張禎晏) noted that leading Taiwanese chipmaker Taiwan Semiconductor Manufacturing Co. is moving some manufacturing out of Taiwan. Chang said this would benefit TSMC and the countries it has moved to as all face different climate challenges and can share information.
“TSMC is also increasingly focused on reducing energy consumption through initiatives such as increasing equipment efficiency and optimizing energy control programs for cooling systems,” the report stated.
The authors recommended environmental assessment requirements be integrated into water recycling and reuse projects. They also said tariff systems should be introduced to incentivize private investment in water reuse schemes.
The report said that Taiwan’s shift from nuclear power adds pressure as renewable energy struggles to keep pace with semiconductor growth. It noted that stable power distribution and high-voltage infrastructure are crucial for a reliable supply chain.
The authors also recommended encouraging semiconductor manufacturers to build on-site energy storage systems to ensure a stable power supply. They said businesses should be required to disclose climate risks and that a cross-ministry information-sharing system should be established to assess corporate climate performance.
The report recommended local governments take on more responsibility for building climate-friendly infrastructure, including providing financing for these projects. Governments should also prioritize transitioning high-polluting industries to low-carbon alternatives, it said
