Wednesday, February 12th 2025
TSMC Approves $17 Billion Investment to Expand Capacity, No Update on U.S. Strategy
TSMC has unveiled today its board meeting decisions, the chip giant has greenlit a massive US$17 billion investment to boost production capacity. According to TSMC, to meet long-term capacity plans based on market demand forecasts and TSMC's technology development roadmap, the board approved capital appropriations of approximately US$17.14 billion for installation and upgrade of advanced technology capacity, installation and upgrade of advanced packaging, mature and/or specialty technology capacity, fab construction, and installation of fab facility systems.
Previous reports by MoneyDJ suggested that TSMC might unveil plans for a third Arizona fab, a potential fourth fab, or its first advanced packaging plant after the board meeting. However, no updates have been confirmed yet. Industry sources suggested that TSMC's second Arizona fab, featuring 3 nm, will likely go ahead of schedule, providing a temporary response to U.S. pressures. According to the same report, TSMC's second Arizona fab is expected to begin equipment installation in mid-2026, with mass production expected by 2027. Notably, this progress would exceed TSMC's projections which expected the second plant to start 3 nm and 2 nm production in 2028, with a third plant potentially for the 2 nm process by the late 2030s. The MoneyDJ report further notes that initially, TSMC's second Arizona plant will offer 25K-30K 3 nm wafers per month. TSMC's first Arizona plant, initially slated for 2025, started 4 nm production ahead of schedule in Q4 2024.
Sources:
MoneyDJ, TSMC
Previous reports by MoneyDJ suggested that TSMC might unveil plans for a third Arizona fab, a potential fourth fab, or its first advanced packaging plant after the board meeting. However, no updates have been confirmed yet. Industry sources suggested that TSMC's second Arizona fab, featuring 3 nm, will likely go ahead of schedule, providing a temporary response to U.S. pressures. According to the same report, TSMC's second Arizona fab is expected to begin equipment installation in mid-2026, with mass production expected by 2027. Notably, this progress would exceed TSMC's projections which expected the second plant to start 3 nm and 2 nm production in 2028, with a third plant potentially for the 2 nm process by the late 2030s. The MoneyDJ report further notes that initially, TSMC's second Arizona plant will offer 25K-30K 3 nm wafers per month. TSMC's first Arizona plant, initially slated for 2025, started 4 nm production ahead of schedule in Q4 2024.
To meet long-term capacity plans based on market demand forecasts and TSMC's technology development roadmap, the Board approved capital appropriations of approximately US$17,141.40 million for purposes including:
- 1) Installation and upgrade of advanced technology capacity;
- 2) Installation and upgrade of advanced packaging, mature and/or specialty technology capacity;
- 3) Fab construction, and installation of fab facility systems.
2 Comments on TSMC Approves $17 Billion Investment to Expand Capacity, No Update on U.S. Strategy
For every watt added by these chips, there needs to be a watt of NEW power generation.
When the utility can't supply enough power to meet the demand, that is when you get brownouts and blackouts or even grid collapses (like what happened in Texas in February 2021). Everyone knows when the utility is failing at its job.
What does matter is if the electricity mix is getting less carbon-intensive over time, if renewables (solar, wind, hydro, geothermal) as a percentage of power generation are going up over time. You can add nuclear power to this question but I doubt it will beat regular renewables on the economics of it.