Growing Wave of Chip Companies Join Global Green Energy Movement

By Terry Tsao, SEMI Taiwan

As the world combats climate change, the chip industry continues to build momentum in becoming a better steward of the environment. In July, Taiwan chip giant TSMC became the world’s first semiconductor company to join RE100, the global initiative to move away from a widespread reliance on fossil fuels and toward 100% renewable electricity. Applied Materials soon followed with a commitment to expand its renewable energy capacity.

For the past four years, ASE Group, the largest outsourced semiconductor assembly and test (OSAT) provider, was named an industry leader in the Dow Jones Sustainability Indices (DJSI), making clear its commitment to protecting the environment. For its part, TEL was selected to be part of the FTSE4Good, a series of ethical investment stock market indices, and FTSE Blossom Japan, an index that gauges the performance of Japanese companies demonstrating strong Environmental, Social and Governance (ESG) practices.

SEMI bolsters commitment to green energy

SEMI has also strengthened its commitment to promoting renewable energy in the semiconductor industry by adding the Green Power Pavilion at this year’s SEMICON Taiwan and continues to support the green energy movement as a co-organizer of Energy Taiwan. The largest renewable energy event in Taiwan, Energy Taiwan features international exhibitions, forums, policy initiatives and business matching events. This year the event attracted more than 12,000 visitors from 50 countries to highlight renewable energy breakthroughs and new products.

The SEMI events complement RE100, which works across a wide range of industries that include financial services and retail. The initiative connects more than 260 members that count among them the world’s most influential businesses such as Apple, Google and Facebook and their suppliers through educational events.

In many respects, TSMC is becoming a beacon of green energy in the chip industry. In July, the company committed to 20-year agreement to buy offshore wind power gear made by energy firm Ørsted in Taiwan, the global leader in the wind power industry. According to the purchase agreement, TSMC will offtake full production from 920-megawatt wind farms off the coast of Changhua County in western Taiwan expected to start operations in 2025 or 2026. The agreement will by far mark the world’s largest corporate green energy order in the semiconductor manufacturing and renewable energy industries and demonstrates TSMC’s long-term commitment to environmental sustainability.

In addition to sourcing renewable energy, TSMC has been working closely with its downstream and upstream suppliers to help drive supply chain improvements geared toward a greener industry by offering on-site coaching, energy audits and educational resources. But the company’s focus on energy efficiency is nothing new. For years, its Supply Chain Management forum has promoted industry sustainability and corporate responsibility. Moreover, TSMC worked with SEMI at this year’s SEMICON Taiwan to generate greater awareness of the importance of green energy to the industry and encourage SEMI members to become more involved in the movement.

Supply chains expand eco-friendly practices

The drive toward greener semiconductor manufacturing is also expanding to encompass entire supply chains. One notable initiative is Green Supply Chain Management (GrSCM), an effort to integrate environmental thinking into every level of the supply chain, from product concept to distribution. GrSCM involves the retooling of product design, materials sourcing, manufacturing and processes to reduce the ecological footprint of factories.

So far, the results are encouraging. More companies are factoring environmental sustainability into their purchasing decisions to urge suppliers to better manage their power usage and join the green energy movement – an important step in curbing the unavoidable consequences of climate change.

Terry Tsao is Global Chief Marketing Officer at SEMI and President of SEMI Taiwan.