TSMC Starves for Kilowatts // Midwestern Crops Ailing // Russia Flares Gas While Cutting Flows

TSMC Starves for Kilowatts

The world relies on Taiwan for semiconductors. The machines that make those semiconductors, extreme ultraviolet lithography systems (EUVs), are made by one company--ASML Holding NV in the Netherlands. EUVs are the size of a city bus, cost around $150 million, and have around 100,000 separate parts, according to Bloomberg.

They also need gobs of energy to run. "Each machine is rated to consume about 1 megawatt of electricity, about 10 times more than previous generations of equipment," reports Bloomberg. No alternative technologies exist for advanced semiconductor production--thus they're a carbon-intensive industry. Semiconductors at TSMC are mostly made from coal-sourced electricity. That puts them in the crosshairs of most green policies.

And that's where the trouble comes in. Taiwan Semiconductor Manufacturing Company (TSMC) has purchased the most EUVs in the world--it has about 80 of them. "Because of the vast amount of power needed to run EUVs, TSMC is expected to soon consume more energy than the entire 21 million-person population of Sri Lanka. In 2020 the company accounted for about 6% of Taiwan’s overall energy consumption. It’s expected to use 12.5% of it by 2025," writes Bloomberg.

But Taiwan is following the primrose path of energy precarity as laid out by the renewables-only environmental dogma. This means Taiwan's energy supply will become more intermittent, less reliable, more expensive, and scarcer. And this is while TSMC is gobbling up so much power it's risking Taiwan's current energy supply.

In 2016, it was decided that by 2025, 20 percent of electricity should come from renewable sources," reports the German outlet Computer Base. Last year, only 6% of the nation's electricity came from renewables, so Taiwan dropped its goal to 15% renewable electricity by 2025.

And yet Taiwan is still fighting over whether to keep its nuclear power plant online. The country's current course will jeopardize the world's ability to produce computers and electronics and imperil Taiwan's stability.

Midwestern Crops Ailing

Scouts on the Pro Farmer Crop Tour recently headed out into the Midwest to see how the crops have fared during the drought. The outlook is disappointing.

"After four days of measuring the yield outlook in Iowa, Illinois, Nebraska, Minnesota and South Dakota, the scouts are coming back with discouraging news for a world that’s dealing with high grocery bills and rising levels of hunger," reports Bloomberg.

Corn is suffering the most. Nationwide, only 55% of corn crop are thought to be in good or excellent condition. Last year it was 60%.

"They found that corn yields in South Dakota averaged 118.45 bushels an acre, down more than 25% from the three-year average," reports Bloomberg. "In Ohio, on the eastern side of the farm belt, corn yields were below last year and the latest US Department of Agriculture estimate. Crop scouts in both states also saw harvest potential below last year for soybeans."

Iowa is seen as the load-bearing state for corn. But it's underperforming, too. Yields looked average to the scouts, but cracks in the soil spoke to parched conditions. Importantly, though Iowa seemed to fare better than other states corn-wise, its output isn't enough to make up for the other states observed on the tour.

Soy seems to be performing better. "Soy crops in Iowa have been maturing well, with most out of the flowering stage of development," Bloomberg reports. "Fields of vibrant green plants sparkled in the sun, like an emerald rug blanketing the earth," the publication added in a rare poetic flourish.

Regardless, flagging crop yields in the Midwest will continue to exert inflationary pressure on food prices.

Russia Flares Gas While Cutting Flows

Gazprom is flaring $10 million worth of gas daily at Portovaya near the Finnish border. According to Rystad, "4.34 million cubic metres of gas are being burned by the flare every day."

This gas would normally flow from Russia to Germany via the Nordstream 1 pipeline. A German ambassador told the BBC that Russia was flaring the gas because "they couldn't sell it elsewhere."

Dr. Jessica McCarty, an expert on satellite data from Miami University in Ohio, said, "Starting around June, we saw this huge peak, and it just didn't go away. It's stayed very anomalously high."

Since McCarthy began to notice the flares on satellite imagery, Russia has slashed Nord Stream flows to 40% of its capacity. In July, after a maintenance period, flows dropped down to 20% capacity.

More recently, European gas prices broke records again this week as Gazprom announced it would halt deliveries from Nord Stream to Germany for three days due to maintenance. "The reason for the 3-day suspension of gas flows via the pipeline would be due to maintenance work at the Trent 60 gas compressor station, which would be carried out with Siemens, according to Gazprom," reports Oilprice.com. 

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Conversation Starters

• The Federal Energy Regulatory Commission issued its final environmental impact statement for the four hydroelectric dams on Northern California's Klamath River. "The staff’s recommendation, which largely echoes an earlier draft opinion, tees up a vote on the roughly $500 million project by the five-member Federal Energy Regulatory Commission later this year," reports AP. If it goes through, it will be the largest dam demolition in American history.

• Reuters reports that a group of Finnish politicians has formed a group called Stop Blackouts "which will launch a petition seeking a revision to the country's energy policy to guarantee adequate power supplies and keep nuclear as part of the mix."

• Crude production in Texas's Eagle Ford has been on the upswing since February, according to the Energy Information Administration. "According to our latest Drilling Productivity Report, we estimate that crude oil production in the Eagle Ford region in southern Texas will average 1.2 million barrels per day (b/d) during September 2022. Despite recent increases, less crude oil is being produced in the Eagle Ford region than before the pandemic—1.4 million b/d in April 2020—and much less than the all-time high of 1.7 million b/d in March 2015."

Crom's Blessing