Climate Change Risk: Impact on Taiwan’s Semiconductor Manufacturing Industry
How extreme weather, water scarcity, and rising temperatures threaten the global chipmaking hub
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Taiwan, the global centre of advanced semiconductor manufacturing, is facing intensifying climate-related threats that could disrupt technology supply chains worldwide. As water scarcity, extreme rainfall, and rising temperatures become more frequent and severe, chipmakers must adapt quickly to safeguard operations.
Our latest Risk Engineering Services publication, Climate Change Risk: Impact on Taiwan’s Semiconductor Manufacturing Industry, examines how climate change is reshaping physical risk exposures for semiconductor manufacturers – and outlines how organisations can improve their resilience strategies.
Key climate-related risks impacting semiconductor manufacturing in Taiwan
- Water scarcity and drought-driven production constraints
Taiwan’s 2021 drought — the worst since 1964 — highlighted the semiconductor industry’s vulnerability to water shortages. As manufacturing processes require significant volumes of water, drought conditions can severely restrict output.
- Extreme rainfall and flooding potentially disrupting production and supply chains
Record-breaking rainfall events, such as those seen in July 2025, have caused flooding, construction delays and road closures.
- Rising temperatures and heatwaves straining cooling systems
Heatwaves – projected to increase from 4–5 days per year today to as many as 52–68 days by 2050 – pose a serious operational challenge.
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Naika Meili
