Worsening drought problems in Taiwan may force TSMC and other chip makers to ship water supplies to their fabs. In case the Taiwanese government tightens water rationing, TSMC, the world's largest chip foundry, may have to rely on truck delivery to continue uninterrupted chip production at its plants in Hsinchu, Taichung and Tainan.
Previous droughts last decade urged TSMC to place a big focus on water recycling but despite a 87 percent recycling rate the firm would still need as many as 180 trucks per day, each with a capacity of three metric tons, to supplement its water supplies.
To be sure, TSMC has implemented recycling measures following a drought more than a decade ago that forced the company to resort to costly truck deliveries. TSMC’s fabs today operate at an 87% recycling rate for the 90,000 metric tons of water used daily at its sites in Taiwan.
The island is experiencing its lowest level of rainfall since 1947, when the government started keeping records, and the Water Resource Agency predicts a "high likelihood" of even drier weather in the next three months.
United Microelectronics Corp (UMC) says it is similarly prepared to buy and transport water from third-party sources to continue chip production.
“If the Taiwan government elevates its restriction measures, UMC already has additional contingency measures in place to accommodate up to a 20% reduction in public water allocation, including the purchase and transport of sufficient amounts of water from third-party sources, UMC spokesman Richard Yu said in a March 20 email. “Since the beginning of the year, UMC has proactively conserved an additional 3% water on top of our existing manufacturing water recycling rate of more than 85%.”