Arizona’s semiconductor boom has always come with a question attached: Where will the water come from?
That question got sharper on Aug. 21, when the U.S. Department of the Interior issued new operating guidelines for the Colorado River. The decision cuts Lower Basin deliveries by 1.25 million acre-feet in each of the next two years. Arizona’s share is 760,000 acre-feet a year, well above the 512,000 acre-feet the state gave up under this year’s Tier 1 shortage.
“The federal government’s decision does not provide the fair, basin-wide leadership the Colorado River crisis demands,” Phoenix Mayor Kate Gallego said the same day.
For the state’s chipmakers, the answer so far has been to use the same water more than once.
TSMC says approximately 65% of the water used at its north Phoenix campus will come from in-house recycling systems at startup. An industrial water reclamation plant, expected to be completed in 2028, is designed to push that to 90% or more as part of the company’s “Near Zero Liquid Discharge” goal.
In Chandler, Intel reports restoring 3.6 billion gallons of water in Arizona from 2023 to 2025 through watershed projects, part of a companywide goal of net-positive water use by 2030.
Amkor’s advanced packaging campus in Peoria, now under construction, is designed to draw at least 80% of its water from reclaimed sources. The company is working with the City of Peoria on wastewater recycling.
The cities that host these plants are building the same way. Phoenix already recycles 97% of the 70 billion gallons of wastewater it generates each year. Its first advanced water purification plant, on Cave Creek Road, is expected to begin operating in 2027 and produce nearly 7 million gallons of purified drinking water a day. Two more plants are planned, and the city expects the program to deliver more than 50,000 acre-feet a year within a decade.
Phoenix also has about 700,000 acre-feet of water banked underground.
“Phoenix has prepared extensively for reduced Colorado River supplies, and our customers can continue to expect reliable water service,” said Brandy Kelso, the city’s water services director.
Chandler, which draws about 37% of its water from the Colorado River, expects that supply to drop about 16% in 2027 and 2028. The city says most of the reduction will come from water it would otherwise store underground. In 2015, Chandler became the first U.S. city to adopt sustainable water-use rules for industrial customers.
The timing is tight. The deepest river cuts arrive in 2027 and 2028, the same window in which Phoenix’s first purification plant and TSMC’s reclamation plant are scheduled to come online.
For an industry built on precision, the next two years will be a test of whether Arizona’s water planning can keep pace with its fabs.
