TSMC Secures Groundwater For Its 7nm EUV Chip Plant Amidst Increasing Water Shortage

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With water conditions in Taiwan worsening as the island waits for rains, the Taiwan Semiconductor Manufacturing Company (TSMC) has started to source groundwater for its chip production needs. TSMC operates chip manufacturing facilities known as 'fabs' throughout Taiwan and the company has been actively pursuing alternate water supplies as industrial water usage in several Taiwanese cities cut down on industrial water usage to manage depleting reservoir resources.

TSMC Procures 50 Tons Of Groundwater From Construction Site After Sending Teams For Analysis Earlier

According to Taiwanese news sources, TSMC sent two tankers to the Qinmei Group's construction project in Taichung, Taiwan today. The tankers are capable of transporting 25 tons of water each, and the chipmaker's decision comes after it conducted tests of groundwater to determine its suitability for use. Qinmei's site is capable of supplying 20,000 tons of groundwater every day according to the construction group, which is one of three construction companies that TSMC is currently in talks with for their site groundwater.

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Qinmei uses advanced technologies such as data analytics and internet of things (IoT) devices to monitor groundwater levels in its site and to ensure that it does not carry out activities over potential reservoirs. Taichung's geography results in large amounts of groundwater which companies are forced to pump out to ensure site safety during the construction process.

TSMC had sent out investigation teams to construction sites earlier this week to determine the water's suitability for its use and the routes used by the tankers from the pumping site to the company's facilities. Qinmei had reached out to TSMC to supply the company and the fab has secured transportation permits from Taichung city that start from the 20th of this month and last until July 18. Through these, the company will be able to transport water from 09:00 to 16:00 and 19:00 to 07:00 the next day.

TSMC's Fab 14 in Tainan, Taiwan.

The destination of the tankers will be TSMC's Fab 15 in the Central Taiwan Science Park located in Taichung city. TSMC uses this facility to build semiconductors on the 7nm process node, particularly its N7+ process which is second-generation 7nm which utilizes extreme ultraviolet (EUV) lithography tools for advanced manufacturing.

In addition to Qinmei, two other companies, one based out of Hsinchu are also under TSMC's radar, with the company working with the Hsinchu government to determine which construction sites are ready to pump out groundwater. TSMC is headquartered in Hsinchu and has several manufacturing facilities in the city's science park.

Water shortage in Taiwan is expected to worsen over time and reservoir levels are at a historic low. The government is expected to tighten rationing in several cities, which will require industrial users such as TSMC to further reduce their water consumption. TSMC has already reduced consumption in some plants in light of government restrictions.

With the Taiwanese fab being responsible for the bulk of global chip manufacturing, resource constraints and a growing competitive environment remain at the forefront of TSMC's greatest challenges. In addition to the ongoing water shortage, the company also has to deal with an island operating with little spare electricity and an ongoing auto chip shortage.

The author has no position in any of the stocks mentioned. WCCF TECH INC has a disclosure and ethics policy.
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