Additional supply critical to semiconductor industry meeting its net zero goals.
SEOUL, South Korea – June 4, 2024 – SEMI, the industry association serving the global electronics design and manufacturing supply chain, as part of its Energy Collaborative (EC) Initiative, and EC Sponsors met with officials from South Korea’s Ministry of Trade, Industry and Energy today to discuss the EC analysis, recommendations and solutions for expanding access of the region’s semiconductor ecosystem to renewable energy – a critical factor for the South Korea chip supply chain to meet its net zero goals.
“Growing demand for low-carbon energy (LCE) electricity is a concern for all manufacturing sectors, but especially for semiconductors as they are critical to many aspects of economic growth and the engine of the information economy,“ said Dr. Mousumi Bhat, Vice President of Sustainability Programs at SEMI. “Transitioning to LCE is vital for the chip industry to meet its commitments to decarbonize. Reducing the carbon footprint of South Korea’s production of chips and the electronic devices they enable is a key part of this work.”
The SEMI EC co-hosted the meeting with Solutions for Our Climate (SFOC) in partnership with the Asia Clean Energy Coalition (ACEC) and the Clean Energy Buyers Association (CEBA). SEMI EC Sponsors, ASML, Lam Research, Qualcomm and Samsung Electronics also attended to provide industry perspectives.
Analysis conducted by the Energy Collaborative shows that the announced LCE adoption targets of South Korean companies are expected to accumulate to 75 TWh to 130 TWh per year by 2030. Even if South Korea were to meet its target of 339 TWh of LCE on the grid by 2030 (as in the draft of the 11th BPLE), under current clean electricity procurement mechanisms, corporations would still see a 25 TWh to 100 TWh shortfall in LCE supply to meet their targets – equivalent to 35% to 75% of total declared corporate targets.
The South Korean semiconductor industry accounts for 7% of South Korea’s GDP and is a key supplier to the country’s broader technology and manufacturing sectors. If the entire semiconductor and electronics manufacturing industry were to enhance its LCE adoption target in line with the 1.5°C pathway, it would add another 30 to 40 TWh annually to South Korea’s corporate LCE demand.
SEMI shared the following recommendations to help close the gap:
- Provide clear signaling of South Korea’s commitment to tripling global renewable energy capacity by 20301 by aligning its national energy targets with the 1.5C pathway.
- Drive down renewable energy generation costs by:
- Establishing a government-operated offshore wind zoning system in which projects are awarded to developers through auction to ensure market certainty.
- Introducing a central resource (one-stop shop) where developers can obtain permits from a single entity to reduce project lead time.
- Alleviating separation distance restrictions2 on solar PVs to increase its potential capacity.
- Ensure predictable and fair costs for renewable energy developers by setting fair regulatory standards on community benefit-sharing and grid curtailment.
- Accelerate grid reinforcement by adopting a government-led grid development system, streamlining the permitting process, and incentivizing private-sector financing.
- Facilitate greater corporate access to renewable energy procurement methods by ensuring that:
- Power Purchase Agreement (PPA) costs (e.g. network usage fees) are transparent and fair
- Green retail tariffs (including the Green Premium) directly contribute to carbon emission reductions
The analysis and its findings and recommendations will be available in a public report to be released in late June.
“We are pleased to partner with the SEMI Energy Collaborative in their efforts to increase access to solar and wind energy for the South Korea microelectronics industry and the region as a whole,” said Joojin Kim, CEO of Solutions for Our Climate (SFOC). “We urge the government and people of South Korea to reduce barriers to renewable energy installation to ensure our region remains an attractive and competitive place to live, work and prosper while reducing our impact on climate change.”
- At COP28 in 2023, South Korea committed to tripling global renewable energy capacity by 2030
- Current separation distance restrictions reduce the potential capacity of solar power by 70%
About the SEMI Energy Collaborative
The SEMI Energy Collaborative was launched in 2023 after analysis by the Semiconductor Climate Consortium (SCC) Baselining Working Group discovered 83% of the semiconductor sector carbon emissions are due to energy usage. The EC assembles a comprehensive ecosystem of key stakeholders, energy experts and industry leaders to advance the industry’s sustainability goals by pursuing a low-carbon energy grid in chipmaking hubs in Asia. The effort benefits humanity by reducing the industry’s carbon footprint, adding new green jobs in communities and providing cleaner air for society while making locations more appealing for site selection by multi-national corporations.
About SEMI
SEMI® is the global industry association connecting over 3,000 member companies and 1.5 million professionals worldwide across the semiconductor and electronics design and manufacturing supply chain. We accelerate member collaboration on solutions to top industry challenges through Advocacy, Workforce Development, Sustainability, Supply Chain Management and other programs. Our SEMICON® expositions and events, technology communities, standards and market intelligence help advance our members’ business growth and innovations in design, devices, equipment, materials, services and software, enabling smarter, faster, more secure electronics. Visit www.semi.org, contact a regional office, and connect with SEMI on LinkedIn and X to learn more
Association Contact
Michael Hall/SEMI US
Phone: 1.408.943.7988
Email: [email protected]
