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29.01.2024 06:31, Alexey Razin
The high concentration of advanced lithographic production in Taiwan, in addition to political risks, also brings with it some infrastructural problems. Scarcity of water and energy resources has already exposed the vulnerability of the local semiconductor industry, and Taiwan’s high dependence on imported fossil energy sources could pose a challenge for customers of local companies seeking to pursue a green agenda.
Image source: Unsplash, Henry & Co
How reminiscent BloombergUS companies Apple and NVIDIA are committed to switching to renewable electricity throughout their supply chain by 2040, but Taiwan’s energy infrastructure may simply not be ready for such a migration schedule. The year before last, as specified, about 80% of electricity in Taiwan was generated using natural gas, coal and petroleum products, which were imported to the island. Renewable energy sources accounted for only 8% of Taiwan’s balance, but by 2025, the island’s authorities are challenging local energy workers to increase this share to 20%.
Considering that nuclear energy provided 9.1% of the island’s needs in the year before last, and is planned to be abandoned in the future, this only aggravates the problem of industry restructuring. Local energy company Taipower forecasts losses of $6.0 billion for the current year, which arose due to rising prices for imported energy resources while the authorities demanded to curb the growth of energy tariffs. In particular, last year Taipower was able to raise electricity prices by 11%, and the year before it limited itself to an increase of 8.4%, and for residential consumers tariffs did not change at all.
Taiwan’s efforts to develop wind farms are facing equipment delivery delays and rising costs. In addition, local authorities require power companies to buy only equipment made in Taiwan, limiting choice and exacerbating delays. Taiwan’s dependence on imported energy also increases geopolitical risks around the island. Customers of the Taiwanese company TSMC, which is the largest contract chip manufacturer, have to take these risks into account, but there are no special alternatives in the field of advanced lithography, although Intel and Samsung are ready to play on these factors in order to lure new customers.
2024-01-29 03:31:00
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