Just one EUV consumes 30,000 kilowatt-hours of electricity every day! Industrial electricity consumption soared by 17%, will it impact TSMC?

The Ministry of Economic Affairs held the first electricity price rate review meeting in 2023 on the 17th to review the electricity price rate for the first half of the year (April to September). The final decision raised the average electricity price by 11%.

Although many friends feel that the electricity price has increased by more than one-tenth of the burden, in fact, compared with ordinary households, it should be industrial users who are really complaining. Because this review meeting decided to increase the electricity price by 17% for high-voltage and ultra-high-voltage industrial electricity users; while the industrial low-voltage industry is mainly based on domestic demand and micro- and medium-sized enterprises, the electricity price will be increased by 10%, which is lower than the industrial high-voltage adjustment.

Taipower said that the 11% increase in the overall average electricity price is expected to reduce losses of NT$60 billion this year, and this time the government has also finalized the electricity price stabilization reserve fund of NT$40.433 billion to fully cover Taipower.

It is estimated that after the implementation of the electricity price increase on April 1, the average price per kilowatt-hour will reach NT$3.1154, the average residential electricity price will change from NT$2.61 per kilowatt-hour to 2.65 yuan, and the average electricity price for industrial electricity will change from NT$2.91 per kilowatt-hour to NT$2.91 per kilowatt-hour. 3.38 yuan.

Taipower pointed out that the electricity price for people’s livelihood has been increased by an average of 2.6%, and the average industrial electricity price has been increased by 14.2%.

How much impact will it have on fabs such as TSMC and UMC?

As a global center of semiconductor manufacturing, wafer foundries such as TSMC and UMC are large consumers of electricity, and electricity bills are also an important cost expenditure for wafer manufacturers.

According to past statistics, TSMC’s electricity consumption in 2020 reached 16 billion kWh, accounting for 5.9% of Taiwan’s total electricity consumption. In 2021, TSMC’s actual electricity consumption will reach 19.19 billion kilowatt-hours, accounting for about 7.2% of Taiwan’s total electricity consumption.

Among them, the power consumption of advanced process machines accounts for more than 50% of TSMC’s energy use. At the same time, considering that the number of advanced process machines is increasing year by year, TSMC’s power consumption will further increase rapidly.

Due to the advanced process below 7nm, EUV exposure machine must be used. Statistics show that an EUV exposure machine consumes as much as 30,000 degrees of electricity a day.

With the advancement of process technology, of course, the number of TSMC’s EUV exposure machines will continue to increase, and the newer the exposure machines, the greater the power consumption. The annual power consumption of a 3nm fab of TSMC is expected to be as high as 7 billion kWh, and the power consumption of TSMC’s more advanced 2nm and 1nm fabs may reach 10 billion kWh in the future.

Last year, Bloomberg reported that it is estimated that within three years, a quarter of Taiwan’s wafer foundries will need EUV devices for chip manufacturing. It is estimated that by 2025, TSMC’s power consumption will account for 12.5% ​​of Taiwan’s overall energy consumption.

In addition, TSMC will build 10 fabs in China in the next five years, most of which will be fabs producing 3nm and 2nm advanced processes. The latest EUV exposure machines are used, so the power consumption will further increase significantly.

Assuming that TSMC’s electricity consumption in 2023 is estimated to be 25 billion kilowatt-hours and the electricity price is raised by 17%, it is estimated that the cost of electricity consumption will increase by about NT$12 billion. Although this figure seems amazing, judging from the total cost of TSMC, their expenditure is mainly on the cost of equipment and materials. single digit percentage. Therefore, the price increase of Taipower actually has little impact on TSMC.

Moreover, this is not the first time that TSMC has encountered an increase in electricity bills. In June last year, the Electricity Tariff Review Committee of the Ministry of Economic Affairs also decided to increase the electricity price by 15% for high-voltage and ultra-high-voltage industrial electricity users. UHV was adjusted from 2.2354 yuan/degree to 2.5707 yuan/degree. At that time, it was reported that TSMC would increase electricity bills by as much as 4 billion yuan a year, but TSMC also emphasized at the time that it would not have much impact on operations.

However, TSMC may be more worried about Taiwan’s power shortage than the rising cost of electricity in Taiwan.

As for wafer manufacturing, as long as there is a sudden power outage and shutdown, it may cause damage to the wafer on the production line, delay the customer’s delivery time, and even burn the exposure machine in severe cases. The money spewed out by stopping a radio accumulation is quite scary.