Semiconductor industry faces supply chain and sustainability challenges

The semiconductor and electronics manufacturing sectors are increasingly focused on onshoring and supply chain resilience due to high geographic concentration in Asia. Taiwan remains a primary producer of advanced chips, while ASML in the Netherlands serves as the sole supplier of essential extreme ultraviolet (EUV) lithography systems.

Geopolitical tensions and climate change are compounding these risks. Extreme weather events have already impacted critical mineral supplies, such as a storm in July 2026 that disrupted copper mining in Chile.

Environmental impacts are also a growing concern. Scope 1 and scope 2 emissions from semiconductor manufacturing are projected to peak around 2030 as advanced technology node production increases, before declining through efficiency gains and renewable energy adoption. Additionally, energy and water consumption in the industry are expected to grow at compound annual growth rates of 6% and 4%, respectively.