Rendering of TSMC’s industrial water reclamation plant is designed to achieve “near zero liquid discharge,” meaning the chipmaker will have the ability to reuse nearly “every drop of water,” according to the company.
PHOENIX, Ariz. (August 28, 2025) – Taiwan Semiconductor Manufacturing Co. (TSMC) has broken ground on a 15-acre industrial water reclamation plant (IRWP) at its north Phoenix campus. The facility is designed to recycle up to 90% of wastewater generated by its chip fabs, a move that aligns with the company’s sustainability goals and Phoenix’s long-term water planning.
The IRWP is engineered to achieve “near zero liquid discharge,” enabling TSMC to reuse nearly every drop of water. Once operational in 2028, the plant will initially recycle approximately 85% of the wastewater, with a goal of reaching 90%. That level of reuse equates to the annual water consumption of roughly 12,000 single-family homes.
Supporting TSMC’s Expanding Arizona Campus
The facility will serve TSMC’s two existing fabs in north Phoenix, with capacity to expand as the company adds more fabs. TSMC completed its second fab earlier this year, which will produce chips using 3-nanometer technology, and has already started work on a third fab at the site.
Collectively, the three fabs are projected to use 17.2 million gallons of water per day. The new reclamation plant will significantly reduce that demand, lowering the first fab’s net water draw from 4.75 million gallons per day to under 1.2 million gallons.
Rose Castanares, president of TSMC Arizona, emphasized that the investment reflects the company’s responsibility to the region’s resources.
“We know that water is a constant concern in the region. We will be a responsible corporate neighbor in our use of natural resources, including water,” Castanares said.
City of Phoenix Partnership
TSMC’s water management efforts are part of a development agreement with the City of Phoenix, which currently ensures access to 11.4 million gallons per day. That agreement could be expanded to 17.3 million gallons to support additional fabs, according to environmental review documents.
Phoenix Mayor Kate Gallego praised the project, calling it a model of sustainable growth.
“By recycling and conserving water at this scale, we support advanced manufacturing and the good jobs that come with it, protect our desert environment, and deliver a resilient future for generations to come,” Gallego said.
A Broader Water Strategy
TSMC has already achieved a 65% recycling rate at its on-site water resource center, which converts industrial wastewater for support systems such as scrubbers and cooling towers. The new IRWP will elevate that capability by producing “ultrapure” water for direct use in semiconductor production.
The company’s global sustainability plan aligns with the United Nations Sustainable Development Goals, targeting a 65% recycling rate across all fabs worldwide by 2030.
Meanwhile, Phoenix is preparing to expand its 91st Avenue Wastewater Treatment Plant by 2033, which will produce up to 80 million gallons of purified water per day for regional use.
Financial Context
The groundbreaking comes as TSMC Arizona reported its first profit since opening in Phoenix, with $150.1 million net income in the first half of 2025, compared with a loss the previous year. The company also reported receiving $2.21 billion in government subsidies during the first half of 2025, up from $262.7 million in the prior year, supporting property, equipment, and construction costs.