Taiwan: As Threat Of Another 2021-type Drought Looms, Key Semiconductor Chip Hub Tainan Announces Drastic Water Conservation Measures

Taiwanese city of Tainan, where leading semiconductor manufacturers including TSMC and United Microelectronics Corp.(UMC) run large fabs, announced the introduction of water-saving measures this week with the prospect of another drought looming.

Southern Taiwan experienced its lowest annual precipitation for 30 years in 2022, forcing the government to increase Tainan's water alert level from "yellow alert" to a more severe "orange alert" on Wednesday (March 22).

Tsengwen Reservoir, Taiwan's most extensive and key water source for the Southern Taiwan Science Park, was filled to just 11.2% of its effective capacity on March 17.

Taiwan is regarded as one of the world's wetter places, with an annual rainfall of 2,600 millimetres. Typhoons regularly hit the island state from the east during the rainy season and replenish reservoirs. But the last time a typhoon made landfall was in August 2019.

Water Conservation Measures

Under the water conservation measures introduced by municipal authorities in Tainan, Industrial users who consume more than 1,000 cubic meters of water per month must curb their use by 10 per cent. Industrial users consuming more than 1,000 cubic meters of water per day who fail to achieve a 10 per cent reduction will have their water supply cut off.

Huang Wei-che, the city mayor, said that tech parks and industrial zones would have usage reductions enforced and managed collectively by the Ministry of Economic Affairs Industrial Development Bureau and Taiwan's National Science and Technology Council.

For nonindustrial businesses that consume over 1,000 cubic meters of water per month, such as swimming pools, car washes, saunas and aquatic therapy specialists, the monthly reduction target will be scaled up to 20 per cent.

Crippling 2021 Drought

The water conservation measures aim to avoid a redux of 2021 when drought was so severe that it disrupted manufacturing and agricultural activities across the island. 

Due to the drought, TSMC and other semiconductor manufacturers depended on water trucks and newly drilled wells to maintain production. 

Semiconductors manufacturing is water intensive. According to some estimates, TSMC uses more than 150,000 tons of water daily (approximately 80 standard swimming pools). TSMC has, however, embarked on several water conservation efforts. Advances in wastewater treatment at semiconductor plants have led to recycling anywhere from 40 to 70 per cent of water used in their processes.

Taiwan could maintain much of its production during the 2021 drought period by diverting water from other purposes towards chip production. Additionally, major science parks in central Taichung city, where many high-tech businesses are located, were exempt from water rationing.