This year’s theme for World Water Day is wastewater. It was aptly chosen given the United Nations’ prediction of a 55% increase in global water demand by 2050 (compared to 2000). To meet this demand, companies will need to manage (waste)water far more efficiently than they do today. The risk of failing to do so becomes concrete when you look at a water-intensive industry such as semiconductors.
Semiconductors are essential components in technology products, including computers and smartphones. The demand for chips is going to increase with the wider adoption of solar energy and connected devices. Semiconductor manufacturing, however, requires large volumes of ultra-pure water to avoid the contamination of electronic devices. A typical semiconductor manufacturing facility uses two to four million gallons of ultra-pure water per day. In 2015, Intel, the largest semiconductor company by market capitalization, used nine billion gallons of water. Given the water intensity of these companies, showing good stewardship will be vital to managing water-related business risks.
The manufacturing of semiconductors generates wastewater that contains heavy metals and toxic solvents. Due to the hazardous nature of these liquids, semiconductor companies historically have incurred clean-up costs related to groundwater contamination of up to USD 100 million. Regulators have also shut down facilities for releasing untreated effluents. Some companies are proactively meeting these challenges and mitigating related risks by reducing their reliance on chemicals and pro-actively improving the treatment of water before discharge. STMicroelectronics, for example, recycled and reused 45% of the total water it withdrew in 2015 and it partnered with Micron Technology to install on-site fluoride waste treatment facilities.
Several semiconductor facilities are situated in arid regions and it is here where the tension between the needs of industry and the community will be most acute. This is especially true where there is an economic driver to attract jobs and investment. Showing good stewardship is essential to maintaining goodwill with regulators and local populations. Taiwan Semiconductor Manufacturing Company (TSMC) is an example of a company that proactively managed community relations. During the 2015 drought, the Taiwanese government imposed water restrictions, prompting concerns from the public regarding water use in the semiconductor industry. To alleviate these concerns, TSMC conducted a media tour to explain its water conservation efforts. Intel is another example of a good water steward that reduced water use in an arid region. In 2015 the company reduced water withdrawal at its facility in Rio Rancho, New Mexico by 40.5% compared to 2010.
Transparency is another important element of being a good steward; however, disclosure on water use remains poor and incoherent. There is currently no industry standard for reporting on water use, making it difficult to assess the efforts of individual companies. Intel is an industry leader in disclosing water usage and reports on use by location with real-time data on its website. With the changing climate, water risks are likely to escalate in many regions, which could trigger stricter regulation on water efficiency and discharge. It is yet to be seen if the semiconductor industry can efficiently manage this risk.
Sources:
Intel manufacturing facilities
Super fund Site – Fairchild and Intel
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