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The Taiwan Semiconductor Manufacturing Company (TSMC) has entered into an energy purchase agreement for 1.2 Gigawatts (GW) of wind energy according to Taiwanese publication United Daily News (UDN). The agreement covers 600 Megawatts (MW) of onshore wind energy and an equal amount of wind energy produced offshore. UDN reports that the agreement has been made with the Taiwanese subsidiary of German energy provider wpd AG.
TSMC Signs Asia's Largest Energy Purchase Agreement As Part of Push Towards Renewable Energy
Details of the agreement shared by UDN do not mention the prices offered to TSMC by Dade Energy Co., Ltd, which is the Taiwanese subsidiary of the German energy provider wpd AG. However, they do outline that the deal covers 1.2 GW of wind energy that TSMC will purchase from Dade. Out of this, 600 MW will be produced on land in Taiwan, and an additional 600 MW will be produced offshore.
The energy will be generated through plants that Dade is yet to set up, and the onshore segment of 600 MW also represents the largest cooperative agreement of land-based wind power generation in Taiwan. Additionally, the 1.2 GW agreement as a whole is also the largest such deal in Asia. According to UDN, over the lifetime of the agreement, TSMC will have purchased 3.69 billion kilowatt-hours (kWh) of electricity from Dade.
The growth of the technology industry has resulted in TSMC solidifying its place as the world's leading contract chip manufacturer with an output of thousands of wafers per month. Semiconductor fabrication is a water and energy intensive process, with fabs like TSMC often requiring uninterrupted power supplies to ensure that their in-process products are not wasted. This has resulted in a corresponding increase in Taiwan's power generation capabilities, which often still fail to adequately meet all of the island's requirements.
Power outages in Taiwan often result in losses for TSMC, since some of its work-in-process products are wasted. The company's facilities in Taiwan's Tainan province have faced two outages this year. The first of these took place in April when Tainan's Nan-ke city, home to TSMC's Fab 14 faced an outage for more than seven hours which saw the chipmaker switch to backup power supplies as an underground power cable was damaged.
Even though Fab 14 produces semiconductors on mature processes, industry watchers speculated that the outage could end up costing TSMC millions of NT$ in damages.
The second outage took place in May, when Fab 14 experienced a temporary voltage drop. This was not as severe as the earlier outage that saw power suspended completely, and TSMC was quick to clarify that no production halts took place the second time around. However, soon after the outage, representatives from Taiwanese power supplier Taipower outlined that the ongoing power rationing t the time was due to insufficient renewable energy being present in the system.
Power consumption also became the cause of concern for TSMC's planned facility for 2-nanometer (nm) semiconductors. These chips, once they enter production, will be the latest from the Taiwanese company. To manufacture them, it aims to build a plant in Taiwan's Taichung sector, and the city's counselor Mr. Lin Qifeng outlined in November that the fact that TSMC's latest 3nm plant uses 7 billion kWh of electricity, the newer facility should only naturally see its power requirements increase.