Sustainable Resource Management Copper Could Become A Bottleneck for Semiconductor Production by 2035

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Water is one of the key bottleneck factors in copper mining, and climate change significantly exacerbates this problem. Analysts from PwC warn that a third of the global semiconductor supply could be disrupted by accelerated climate change—in just ten years.

Circuit boards are found in almost every electronic device, and it's not much different with semiconductors nowadays. It is assumed that the demand for semiconductors will grow even further, especially when considering the speed at which data centers are being built. This also means that the need for resources to manufacture chips is increasing.

These resources are not always readily available and accessible to the industry even now, and this situation is expected to worsen in the future. Analysts from the accounting firm PricewaterhouseCoopers (PwC) recently warned in the report "Climate change threatens the world's most critical technology" that already one-third of the global semiconductor supply could be negatively affected by climate change within the next ten years. One of the driving factors behind this, though still little acknowledged, could be the hindrance of copper mining due to water scarcity, according to PwC.

Copper from the World's Driest Regions

Water is indispensable for open-pit copper mining. It is used for dust suppression, ore processing depending on the method, and for cooling plants and machinery. Producing one ton of copper can require over 8 million gallons of water; on average, mines need around 26,400 US gallons of water per day. Freshwater, mind you.

Copper, in turn, is essential for the production of modern microchips, particularly for the finest wiring structures within semiconductors. However, copper mines are highly water-dependent, and ironically, water is becoming increasingly scarce due to droughts in the most important mining regions.

Even today, all copper supplies classified as threatened for semiconductor production come from Chile, which is repeatedly affected by extreme drought, partly due to alternating weather phenomena such as El Niño and La Niña. Since much of Chile's copper mining takes place in the arid Atacama Desert region in the north, La Niña can dramatically exacerbate water scarcity there. Even in El Niño years, which are associated with more rainfall, availability is neither predictable nor consistent.

Risk in Other Countries Where Copper is Mined

By 2035, ten more copper-producing countries, including China, the USA, Peru, and Australia, could also be considered risky for climate-unaffected copper supplies. In the most pessimistic scenario, by 2050, only three countries (Papua New Guinea, Panama, and Indonesia) would be able to supply copper with relatively stable climate conditions.

The share of global semiconductor production reliant on these threatened copper sources could, according to PwC analysis, rise to 32 percent by 2035—and, in the worst case, up to 58 percent by 2050. Alternative materials such as graphene or silver are currently not considered economically viable. It becomes clear that without securing copper availability, significant bottlenecks in one of the world's most critical key industries are looming.

Investing in Resilience

PwC therefore recommends concrete measures: copper mines could reduce their water consumption through recycling and new processes such as dry tailings management or by relying on seawater desalination. In Chile, the share of seawater used in copper mines increased to approximately 22 percent by 2020, with a rising trend. These desalination plants are particularly utilized in regions where access to freshwater is severely limited, such as in the Atacama Desert.

At the same time, the proportion of recycled water is increasing. In the mines of major Chilean operators like Codelco, the share of reused water is already over 70 percent in some cases, primarily through closed-loop processing systems.

Semiconductor manufacturers should simultaneously increase material efficiency, use recycled copper, and advance the geographic diversification of their supply chains. In the long term, the report makes it clear that climate change is not just an ecological challenge but also a geopolitical risk lever for technological sovereignty. (sb)

Link: To download the report 'Climate change threatens the world's most critical technology'

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