Taiwan Semiconductor Manufacturing Company (TSMC), the world's largest chipmaker, is facing increasing scrutiny over its escalating energy consumption, which is putting strain on Taiwan's power grid. According to a recent S&P Global report, TSMC's total energy usage has been growing by 10-20% annually over the past four years, a trend expected to continue due to expanding production scales and advanced technology usage.

TSMC's electricity consumption far outpaces its industry peers, with the company using more than 24 billion kilowatt-hours in 2023 alone – equivalent to the entire city of Phoenix. This surge in energy use is largely attributed to the increase in 3nm semiconductor production, which requires energy-intensive processes such as extreme ultraviolet (EUV) lithography systems.

The chipmaker's power demands are placing significant pressure on Taiwan's electricity infrastructure, with TSMC consuming more than 8% of the island's total electricity. Projections suggest this demand could triple by 2030, raising concerns about the sustainability of Taiwan's energy supply and the potential for power outages that could disrupt chip production.

In response to these challenges, TSMC has committed to achieving net-zero emissions by 2050 and aims to transition to 100% renewable energy consumption by 2040. However, Taiwan's geography presents obstacles to rapidly scaling up renewable energy sources like solar and wind power.

The situation underscores the complex interplay between technological advancement, economic growth, and environmental sustainability in the semiconductor industry. As the demand for advanced chips continues to grow, particularly driven by the AI boom, finding solutions to balance energy needs with sustainability goals will be crucial for TSMC and the broader tech sector.