Taiwan is dealing with its lowest rainfall in 75 years, and the situation is hitting the western region where its most advanced semiconductor fabs operate, raising fresh concerns about water supply at a time when global chip demand continues to surge and pressure on production remains high.
According to Liberty Times, the western part of Taiwan, including Hsinchu where TSMC runs its most advanced fabrication facilities, is under increasing stress due to severe water shortages, and authorities have already issued a “yellow” warning in key districts to signal rising risk levels and push early conservation measures.
The water shortage comes at a critical time because Taiwan sits at the center of the global semiconductor supply chain, and TSMC’s advanced fabs play a major role in powering AI infrastructure, consumer electronics, and high-performance computing systems across the world, which means any disruption in this region carries broader consequences.
Local authorities are taking steps to manage the situation and maintain a stable water supply for industrial zones, and for now there are no immediate concerns about production being affected, but officials are preparing for the hotter months ahead by rolling out drought-resistance strategies and pushing industries to improve water efficiency.
Energy Risks Add Another Layer of Uncertainty
At the same time, Taiwan faces growing pressure from energy supply risks tied to global tensions, especially around LNG shipments through the Strait of Hormuz, since the country depends heavily on liquefied natural gas for electricity generation, and current reserves only cover a limited period if disruptions occur.
This combination of water shortages and energy uncertainty places Taiwan’s semiconductor ecosystem under closer scrutiny, and while the government remains confident in managing both challenges, any escalation could ripple through the global chip supply chain and impact industries that depend on advanced silicon.
The situation remains under control for now, but the coming months will determine how well Taiwan can protect its most critical manufacturing sector under sustained environmental and geopolitical pressure.
