Decarbonization Challenges for Chip and Silicon Wafer Manufacturers

Chip makers are in a complex, paradoxical situation. While semiconductors play a fundamental part in greener energies and decarbonization, fabs are also very contaminated due to their water and energy needs and the emissions of their suppliers, like silicon wafer manufacturers.

Because of that, several comments have been made about the semiconductor industry’s contaminating situation. As demand for chips only increases, this situation will likely worsen. Let's deeply analyze semiconductor manufacturers' emissions while assessing some positive developments.

Semiconductor and Chip Manufacturers Carbon Footprint

While not being the worst industry overall, chip and semiconductor makers have a big greenhouse gas footprint. In fact, semiconductor manufacturing is responsible for as much CO2 output as half of US households.

This situation is only expected to widen over time as states and wafer manufacturers make great offers to expand their capacity, build new fabs, and meet the growing demand for semiconductors to power energy-efficient devices.

More discrete, analog, and optoelectronic (DAO) chips will be required, along with more logic and memory chips for the AI industry. Concurrently, cutting-edge advanced nodes are becoming smaller, especially in the logic and memory segment. This increases production complexity, thus consuming more electricity.

This happens in an environment where semiconductor companies are under mounting pressure to decarbonize, especially before the Paris Agreement.

Customers are pushing for more environmentally friendly, emission-free productions. States are also pressuring businesses to provide more accurate and transparent information about their emissions records throughout their supply chains as a prerequisite for creating mitigation plans.

How Do Emissions in the Chip Industry Work?  

Chip manufacturers have made efforts to lower emissions from Scope 1 and Scope 2. However, if they want to accelerate their carbon reduction efforts, chip companies need to go far beyond that and focus on Scope 3 emissions.  

But what are Scope 1, 2, and 3 emissions?

• Scope 1 emissions are direct emissions from owned or controlled sources, that is, from the chip makers' own production efforts.

• Scope 2 emissions are indirect emissions from purchased energy.

• Scope 3 emissions are indirect emissions that emerge from the value chain, such as those made by crucial metal providers during mining.

Chip companies must also target emissions from upstream Scope 3 activities to accelerate their carbon reduction. These primarily encompass CO2 output contributed by suppliers, such as raw materials, manufacturing, logistics, and related supplier production.

Scope 3 emissions are the main contributors to emissions in the chip manufacturing industry and comprise about 40% of chip makers’ carbon emissions today. Raw wafers, process gases, and metals are the worst offenders in this category:

• Compound semiconductors, such as silicon carbide or gallium nitride, release considerable amounts of CO2 as they have higher melting temperatures. This results in more energy consumption during raw wafer production.

• In addition to perfluorocarbons (PFCs), a class of extremely potent greenhouse gases, nitrogen and argon are the main gases released during the production and transportation of process gases. While PFC leakages are well below 1% during production and transport, this is already enough to generate significant climate impact.

• The primary sources of CO2 emissions are related to the metals industry. For instance, the mining, transportation, and remelting stages are conducted to achieve the required purity of high-density materials and metals. However, it’s difficult to separate metals consumption in chip making from metals used in other electronics sectors.

The Way to Reduce Chip Manufacturers’ Carbon Footprint

As more semiconductor fabs are developed, chip makers have a window of opportunity to address this significant source of their overall emissions—their suppliers.  

After all, industry diversification will offer chip manufacturers more providers to choose from. However, a real change in the industry’s emissions will only be achieved through dedicated negotiations and a strategic approach.  

In the upstream supply chain, emission sources are dispersed among many businesses, materials, and geographical areas with various manufacturing cultures. Restructuring supplier management will be essential to decarbonizing this extensive network.

Chip manufacturers will need to collaborate much more closely with their suppliers, monitoring their practices, rethinking value chains, and exchanging decarbonization tactics.

So, How Do We Achieve That?

Because chip manufacturers have various complex emission sources, decarbonizing the supply chain is a process that needs a comprehensive transformation.  

However, with the government’s incentives and staging demands, we’re already experiencing big changes in the sector. Taking a greener approach is just a change of perspective.  

Some effective strategies to practice during this time can be:

Investing in Innovation

Investing in research for innovative solutions that make production more effective can be the key to reducing emissions while securing a competitive advantage.

• For example, a semiconductor company could collaborate with wafer fab equipment manufacturers to design and build cutting-edge lithography equipment to lower resource consumption and increase process efficiency.  

Collaborating with Other Manufacturers

Collaborating with other chip makers and managing demand, suppliers, and emissions is fundamental to making industry-wide changes.

• For instance, a chip manufacturer could become a member of an industry alliance established to create and implement low-emission substitutes for fluorinated gases (such as sulfur hexafluoride and nitrogen trifluoride) utilized in chamber cleaning and plasma etching procedures.

Opting for Greener, Local Wafer Providers

Concentrating on choosing suppliers who use local sources, emphasizing decarbonization, or using alternative, lower-emission materials when possible will change your carbon footprint.

• For instance, opting for a local wafer manufacturer over an international one can reduce emissions considerably.  

Developing Long-Term Partnerships Focused That Foster Circular Economies

Establishing long-term contracts and strategic alliances to secure your providers and collaboratively developing circular economy strategies can ensure less emissions throughout the entire supply chain.

• For example, you can establish strategic partnerships that consider ways to recycle and reuse metals, chemicals, packaging materials, and even essential compounds (like silicon carbide).

Find Local Silicon Wafer Manufacturers Committed to Reducing Emissions

Decisions about where to source goods will unavoidably consider sustainability as customers and governments continue to highlight the importance of greener products. With these tips, chip manufacturers can guarantee an adequate supply while lowering waste and related emissions in the supply chain.

An important aspect of this process is diversifying your supply chain and opting for local providers that produce fewer emissions during transportation. If you’re interested in learning more from a local wafer manufacturer, contact Wafer World today!