Semiconductors: Fueling the Transition to a Green Economy or Environmental Hazard?
Semiconductors are the fundamental components of contemporary computing. They are essential parts of every electrical device, including automobiles and cell phones. However, the cost of producing them for the environment is starting to become an issue.
As chip design becomes more complex, there is an increasing energy demand; the production of advanced 3nm chips (N3) is expected to use up to 7.7 billion kilowatt-hours of energy yearly.
Inversely, semiconductors help make the shift to a green economy easier. Global decarbonization initiatives will boost the use of electric cars and renewable energy sources, which will raise demand for chips. It is anticipated that between now and 2027, the number of power semiconductors utilized in the global renewable energy industry will increase at a compound annual growth rate (CAGR) of 8% to 10%.
Critical Elements of Such Green Transition
Despite the potential environmental risks associated with their manufacturing process, semiconductors are essential to the advancement of green technologies. With the least amount of power loss possible, they harvest, transform, transport, and store renewable energy as electricity before transferring it to the electric grid.
Furthermore, semiconductors make it possible for IoT technology to use electricity responsively and efficiently by ensuring that current is dispersed evenly and supply is equal to demand. Semiconductor technology is essential to wind turbines and solar panel systems alike.
Making electric cars (EVs) and charging stations also requires semiconductors. An electric automobile typically has 2,000 chips, which is almost twice as many as a non-electric car. Chips are the brains of electronic materials; they are what propel innovation in the auto industry.
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By managing every function, from parking cameras to breaks, they enable cars to become safer and smarter. The number of electric automobiles on the road worldwide in 2020 was 10 million, a 43% rise from 2019.
Numerous factors, such as government incentives, regulatory laws, and advancements in semiconductor design that have reduced car costs and boosted battery life, have contributed to the surge in consumer demand for electric vehicles (EVs).
62% of the total amount of renewable electricity generated in 2020, according to a report by the International Renewable Energy Agency (IRENA), was less expensive than the least expensive new fossil fuel option.
Resource Driven Production
Semiconductor manufacturing has a large environmental cost even though it is essential to the growth of the clean energy economy. The semiconductor industry is resource-intensive, requiring large amounts of water and electricity to produce chips.
A 2020 study made an effort to measure the carbon footprint of computer systems using publicly accessible business sustainability reports. According to their findings, the majority of the carbon produced during the production of electronic devices is currently attributed to the chip manufacturing process.
According to Bloomberg reports, the pollution caused by semiconductor manufacturers has surpassed that of vehicles due to their significant power use.
Taiwan is home to 90% of the world’s advanced semiconductor production capacity. Six percent of the island’s energy is consumed by Taiwan Semiconductor Manufacturing Co. (TSMC), the largest chip manufacturer in the world.
By 2022, this percentage is anticipated to surpass 7%, positioning TSMC as Taiwan’s top energy user. In 2020, the business created about 15 million tonnes of carbon. Industry rivals Samsung and Intel produced 13 million and 3 million tonnes of carbon, respectively.
Water is used in the chip manufacturing process to clean and rinse silicon wafers, eliminating dirt from the manufacturing process. Ultrapure water (UPW), which is thousands of times purer than drinking water, is needed for this operation.
To produce 1,000 liters of UPW, around 1,400 to 1,600 gallons of city water are needed. TSMC utilized more than 193,000 tonnes of water every day in 2020. This is equivalent to almost 70 billion liters of water in a single year. Overall, 10% of Taiwan’s water supply is used by the semiconductor sector. Taiwan is facing significant water shortages as a result of anomalous climate patterns brought on by climate change.
Conclusion
The CHIPS Act of 2022 was just passed by the US government with backing from both parties. This landmark law sets aside US$53 billion to boost US competitiveness and semiconductor production. In the meantime, the EU plans to raise around 43 billion in public and private investments to tackle the lack of semiconductors and bolster Europe’s position as a leader in technology.
Costs associated with energy and the environment are high with digital sovereignty. In the short run, industrial policies that seek to increase the proportion of domestic semiconductor production might not align with the green agenda. Manufacturers who are striving to expand capacity must prioritize reducing their carbon footprint as the demand for semiconductors around the world rises.
