Let It Rain or Else No Chips


Computer motherboard. Credit: Alexandre Debiรจve Computer motherboard. Credit: Alexandre Debiรจve

Industry continues to face massive shortages of computer chips and the primary producer, Taiwan, faces many unique risks compounding the shortage. One set of risks is geographical. Taiwan is an island with a subtropical climate that often incurs supply shocks for electricity and water. Without vast energy resources nor space for renewable sources, Taiwan produces roughly two-thirds of its electricity from imported coal and natural gas. During the summer months, when demand for air conditioning peaks and grid load is the highest, rolling brown outs occur that affect semiconductor fabrication facilities (examples from 1999 and 2017). More recently water has come into focus but that has also been a persistent problem for Taiwan. Oh and they also have earthquakes too. The last elephant in the room, is the geopolitical risk to the semiconductor supply chain that is getting a lot of attention in Washington. There are not a lot of options for cutting edge semiconductor technology if these risks are borne out. For now, let it rain in Taiwan.

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