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Comment by totalZero | Hacker News Reader

It would make more sense to put the mega-fabs where electricity is cheapest in the Americas, and that certainly isn't Arizona.

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> would make more sense to put the mega-fabs where electricity is cheapest in the Americas, and that certainly isn't Arizona

Geologically stable. And at least for business, politically stable. Same reason Walt Disney is frozen in Phoenix [1].

[1] https://www.alcor.org/

Ah, the lesser-known Pascal's Wager business plan.

The Disney thing is an urban legend, right?

> Disney thing is an urban legend, right?

I’ve heard the claim repeated by an Alcor employee. But they may have been repeating a myth. (Alcor definitely exists, and claims it chose Phoenix for the aforementioned reasons.)

Walt Disney was cremated. https://www.snopes.com/fact-check/suspended-animation/

It's right there on the death certificate: https://findadeath.com/wp-content/uploads/directory/w/Walt_D...

The legend I heard was that only his head was frozen. I believe Alcor does provide head freezing services and at cheaper cost than whole-body.

Isn’t solar the cheapest energy per KwH? A sunny place like Arizona with tons of empty space should be able to cheaply deploy lots of energy.

The cheapest energy is from a hydroelectric plant built generations ago.

Fun fact: That's why Boeing first built their planes outside Seattle - the electricity needed to refine the aluminum was cheap.

These days, you can see that effect in the large datacenters that have sprung up near the Columbia River in Oregon.

I'd guess TSMC's siting decision had a lot to do with tax breaks, labor pool, and cheap land.

Probably also hedging for geopolitical risk? Not sure how only having facilities in a country at least somewhat likely to be invaded in the next few years affects the stock price but it probably doesn't hurt to put one in the middle of a country very unlikely to be invaded and very likely to want to purchase chips built domestically.

Fun fact most experts consider the US uninvadable: https://en.wikipedia.org/wiki/Invasion_of_the_United_States#...

Another fun fact. There were incursions on both US coasts during WWII. Neither were significant:

Long Island, Florida, and Maine invasion by nazi spies swimming to shore from German submarines: https://www.fbi.gov/history/famous-cases/nazi-saboteurs-and-....

Japanese in Attu and Kiska islands in Alaska: https://www.history.com/.amp/topics/world-war-ii/battle-of-t...

Cheap, seismically stable, land.

I think that depends how much build-out you have to do in order to install the kind of capacity required for a $40B semiconductor fab, which would hypothetically need some kind of major energy storage infrastructure or backup source in the event that solar is the main source of electricity.

> Large semiconductor fabs use as much as 100 megawatt-hours of power each hour, which is more than many automotive plants or oil refineries do. [0]

If a fab is running at that consumption rate for twenty hours every day for one year, it will consume approximately all of Arizona's 735,000 MWh of annual utility-scale solar, wind, and geothermal net electricity generation. [1]

Contrast that with the annual hydroelectric generation of Itaipu Dam in South America, at 79,440,000 MWh in 2019. [2]

[0] https://www.mckinsey.com/~/media/mckinsey/dotcom/client_serv... [pdf]

[1] https://www.eia.gov/state/print.php?sid=AZ

[2] https://www.power-technology.com/projects/itaipu-hydroelectr...

> Large semiconductor fabs use as much as 100 megawatt-hours of power each hour

Ooof, this kind of writing where the author doesn't understand units just gets my goat. Just say it uses 100 MW! Geez.

I prefer it as written, because the additional information of timeframe for measurement indicates that the author is not talking about momentary/peak power.

Which indicates the author knows nothing about how semiconductor fabs use power. Power usage is stable with a few percent...and 100MW is really on the low side for this fab. If all 6 phases are completed as they are expected to be...it's more like 250MW.

I think we can forgive the author for the low estimate considering that this project didn't exist publicly at the time of writing.

How does power usage remain stable in a fab? Please say more about how that works.

Much of the power is used for keeping air clean with temperature and humidity controlled in a very tight range. More energy is used for water cooling, waste treatment and other facilities. The rest of the power is used for production tools...which when a fab is running are generally consistent users. The power usage will scale with wafer loading, but again advanced fabs like these will run at near 100% capacity for years at a time.

I'd still much rather see "100 MW continuous" over "100 megawatt-hours of power each hour". And the former actually tells you a lot more than the latter, as with the latter it could be bursty (e.g. much more than 100 MW momentary draw), which would be a lot harder to supply. Fortunately for everyone the power draw is actually steady.

Here is a solar plant in California, which broke ground over a decade ago, that produces 550 MW of power, for $2.5B. Build even a small version of one of these and its 100 MW power needs are met.

https://en.m.wikipedia.org/wiki/Topaz_Solar_Farm

The 550 MW "nameplate capacity" is peak. The capacity factor of 26.6% means that it actually only produces about 146 MW on average. Nuclear power plants generally have a capacity factor above 90%.

146 MW on average is still more than this facility needs.

Not during the night and not when it is cloudy. Averages are vey bad numbers for something which is on 24/7.

Do the plants typically run at night? Also, doesn't the capacity factor account for these variations already?

No, you would need a large storage facility as well.

A nameplate capacity of 550 MW with a capacity factor of only 26% almost certainly means there are a lot of times when it isn't generating any power at all, or at least none to speak of.

Right, but if those align with the times where the plant is not used at all (night), does it matter? That being said, I have no idea what the normal operational schedules are for these types of facilities.

I'd wager a large sum that if you're investing $40 billion in a plant, you're going want it running 24/7/365.

And definitely not if the clouds suddenly blow in when the process is at a critical stage.

Electricity usage is much, much lower at night in Arizona because everyone turns AC off due to temperature drop. Plenty of baseload generators that can be better utilized at night with increased manufacturing.

Kinda. Depends on the season. In the summer, its still 80 degrees at night in Phoenix.

Nope...once all phases are built they will be using ~250MW of power.

Solar farms are one of the fastest electricity generators to build. AZ will have no problem stepping up production in the face of demand.

Your EIA source is for generation in the month of august only. Total solar generation in Arizona is much higher than that. Very roughy 1,500x nameplate capacity = total annual generation in Arizona. 5,600 mw capacity in 2021, 8,400,000 mwh annual generation.

https://en.wikipedia.org/wiki/Solar_power_in_Arizona

All fabs have battery backup regardless of power source, although with solar you would need a much larger one indeed. Either way, the scale of solar power generation easily supports these new fabs.

https://www.eia.gov/electricity/generatorcosts/ Cost is ~1,65B per GW of solar. 30% subsidy from government = ~1.1B per GW to generate ~ 1,500,000 mwh. They’re dirt cheap. Unfortunately battery storage, while it exists at this level, is more in the range of 800M to be safe (1600 mwh of storage). https://www.tesla.com/megapack/design

So all power infrastructure would be less than 5% of the cost of the plant, and that’s overbuilding solar needs by 4x (meaning even on the crappiest day power wise you’ll have more than enough) and having 16 hours of backup power which is also overkill.

There's also a nuclear plant nearby in AZ:

https://en.wikipedia.org/wiki/Palo_Verde_Nuclear_Generating_...

Nuclear + Solar seems like it would be a pretty ideal mix in a hot climate, especially given that peak demand for air conditioning coincides with solar maximum output, and Nuclear could handle some of the base/overnight load.

It is but you also need controllable components with the ability to quickly change output performance when building solar as your peak source. Usually this means gas turbines, in some cases this could also mean battery.

Do these plants not require tons of water?

from the wikipedia link - they use sewage/greywater for cooling:

> The power plant evaporates the water from the treated sewage from several nearby cities and towns to provide the cooling of the steam that it produces.

This treated sewage is the water that Vegas now provides for general use, and what AZ will need just for its people in about 5 years. Wasting it on chip production is going to go over slightly better than the Saudis wasting groundwater on alfalfa.

They could literally truck Evian water in if they wanted to. Water is extremely cheap compared to just about every substance on earth, and it’s hard to imagine that water costs can be a problem for this type of operation.

You're assuming that the severe undervaluing of natural resources in the US will simply continue. Try taking a field trip to a place (including the US), where people can't drink the water that comes out of their tap, and you'll get a better idea of where this leads. In no universe can TSMC use bottled water, much less Evian, and be competitive.

This may not be true today. But when I first arrived in US in AZ, I was told Phoenix boasts highest numbers of golf club concentration in entire US, despite high water requirements of a golf club and being in middle of desert.

I suspect the ongoing Western US drought would have worsened the water situation.

Arizona has the reputation of being a desert, but in reality it is a state that is half-desert and half-mountain, and has a tons of water. Enough to waste on ubiquitous golf courses and alfalfa farms. There is a canal system taking the water from the mountains to the drier south where people live.

But the population pressures are realigning who pays what for the water now, so I expect the alfalfa farms are going to go, and chip fabs will take their place.

The thing you don't mention is that Arizona is wasting other people's water -- nearly 40% is sourced from rivers originating in other mountainous states

https://www.arizonawaterfacts.com/water-your-facts

I don't mention it because it's not true. The idea that if a river originates in one state, then that state owns all the water from the river is not how ownership of river water works. And in America, rivers often form the border of states, so there are always competing claims about which state gets which percentage of the river. These are generally settled through treaties and agreements among states, and those agreements were made also for the Colorado river. Arizona is only taking its share of the water as per the treaty, not someone else's share.

And it's share of water was already insufficient a decade ago, which is why the water table has run dry in many rural areas, forcing people to truck in bottled water or pack up and leave.

Do you mean the Colorado River? The one that flows through the Grand Canyon? The canyon in Arizona?

Yes, the Colorado River whose headwaters comes from the state of Colorado.

That's kind of a ridiculous way to claim "ownership" of water. Especially water that naturally flows into the state.

"Has tons of water"? LOL It is 5 years from rationing. Vegas solved their problem 20 years ago, things in AZ have gotten 10x worse.

> Arizona has the reputation of being a desert, but in reality it is a state that is half-desert and half-mountain, and has a tons of water.

The mountainous areas are 'high deserts'. Most of Arizona's water is underground. It's being pumped out faster than it's replaced. Old wells go dry all the time, because newer wells are deeper.

"The Sonoran Desert's bi-seasonal rainfall pattern results in more plant species than any other desert in the world. The Sonoran Desert includes plant genera and species from the agave family, palm family, cactus family, legume family, and numerous others." - https://en.wikipedia.org/wiki/Sonoran_Desert#Flora

> There is a canal system taking the water from the mountains to the drier south where people live.

The Central Arizona Project pumps water straight east from Lake Havasu (738 ft elevation) to Phoenix (1086 ft elevation), then south to Tucson (2388 ft elevation).

https://en.wikipedia.org/wiki/Central_Arizona_Project / https://www.cap-az.com/water/cap-system/water-operations/sys...

The Salt River Project [SRP] buffers water from the rivers that run through the Phoenix area, and diverts the rivers into canals for delivery to the Phoenix area. Before the dams, the Salt and Verde rivers ran year-round. SRP modernized/expanded the Hohokam's ancient canals.

https://en.wikipedia.org/wiki/Salt_River_Project#History

> Do these plants not require tons of water?

If you’re referring to the Palo Verde Nuclear Generating Station, it’s downstream of water treatment plants and is effectively evaporating the water from the effluent stream [1], in other words it’s cooled by 100% recycled water. Probably a significant amount of the evaporated water returns to the local area.

[1] https://en.wikipedia.org/wiki/Palo_Verde_Nuclear_Generating_...

ASU has a good optical engineering program too, electricity is no the only variable.

Also, I would think that lots of water is needed, and Arizona is pretty dry.

Seismic activity

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