As Arizona’s semiconductor industry grows, so do environmental concerns. Taiwan Semiconductor Manufacturing Co. and Intel, two of the largest chip manufacturers in the state, are both building massive facilities as part of the U.S. government’s CHIPS and Science Act initiative. However, a coalition of environmental and labor groups known as CHIPS Communities United is urging the U.S. Commerce Department to conduct more thorough environmental reviews.
On the second anniversary of the CHIPS Act, CCU expressed concerns that the government is too hastily approving semiconductor projects without considering their environmental impact. They argue the Commerce Department’s “findings of no significant impact” for these plants, which include TSMC’s facility in Phoenix and Intel’s Ocotillo factory in Chandler, fail to address potential risks to Arizona’s water supply and air quality.
Why the Scrutiny Matters
Arizona has positioned itself as a leader in semiconductor manufacturing, driven by the need to reshore chip production and reduce reliance on foreign supply chains. TSMC’s $65 billion project in north Phoenix and Intel’s $20 billion expansion in Chandler are key parts of this strategy. Both facilities are expected to create thousands of jobs and boost the local economy. However, critics argue these benefits could come at a high environmental cost.
CCU has called on the Commerce Department to conduct full Environmental Impact Statements for these projects to ensure their potential effects on water, energy and hazardous chemical releases are fully understood by the public. Lenny Siegel, a former mayor of Mountain View, California, and a member of CCU, voiced his concerns: “To claim that these projects will have no significant impact on the environment doesn’t pass the smell test.”
Water Use in the Desert
One of the most pressing concerns is water use. Arizona has been grappling with a longstanding drought, and the state’s allotment from the Colorado River has been reduced due to water shortages. According to the Central Arizona Project, Arizona saw its water supply cut by 592,000 acre-feet in 2023, representing about 34% of its normal supply.
TSMC’s north Phoenix facility is expected to consume more than 17 million gallons of water per day, an amount that could supply roughly 57,000 households. This level of water consumption has raised red flags among environmental advocates. Intel’s Chandler plant, while not as large, also adds to the strain on local water resources.
Yet, it is important to note that both companies have water sustainability efforts in place. TSMC has committed to recycling 65% of its water and is building an industrial water reclamation plant that will allow it to recycle 90% or more. Intel, too, has been proactive, achieving “net positive water” at its Arizona facility in 2021 and 2022. This means Intel restored more water to local communities than it consumed, largely through water conservation and restoration projects.
While these initiatives are significant, critics argue they may not be enough to offset the environmental burden of such large facilities.
Energy and Emissions
Energy use is another major concern. TSMC’s Phoenix plant is expected to use enough electricity to power 300,000 homes, adding strain to Arizona’s grid. Additionally, the facility will emit more greenhouse gases than 32,000 homes, raising concerns about Arizona meeting its long-term climate goals.
At the same time, CCU is worried about the disposal of hazardous chemicals like PFAS (per- and polyfluoroalkyl substances), which are known as “forever chemicals” because of their persistence in the environment. PFAS are commonly used in semiconductor manufacturing, and CCU claims the Commerce Department has not provided sufficient detail about how these chemicals will be treated or disposed of.
In a letter to the Commerce Department, several U.S. senators, including Elizabeth Warren and Bernie Sanders, echoed CCU’s concerns, calling for stricter environmental regulations before federal funding is disbursed.
Balancing Growth and Sustainability
The debate over Arizona’s semiconductor industry highlights the need to balance economic growth with environmental sustainability. The CHIPS Act offers a once-in-a-generation opportunity to rebuild the U.S. semiconductor supply chain and secure American technological leadership. But, as critics point out, it also presents an opportunity to address the industry’s environmental footprint.
The outcome of this debate will shape Arizona’s ability to maintain its status as a leader in the semiconductor industry. While the semiconductor community in the state continues to grow, it is evident that finding a balance between economic progress and environmental stewardship will be key to its success.
Did You Know: Chips and the Environment
- Department of Commerce is finalizing agreements to disburse $53 billion in chip manufacturing grants under the CHIPS and Science Act.
- The three projects CHIPS Communities United specifically expresses concerns about are TSMC’s Phoenix facility; Intel’s Ocotillo factory in Chandler, Arizona; and Micron’s ID1 plant in Boise, Idaho
- For 2024, Arizona will operate under Tier 1 water shortage conditions. According to the Associated Press, Arizona could see an 18% cut from its total Colorado River water allocation as a result.
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