AI's energy appetite has Taiwan reconsidering the nuclear option

Premier indicates possible shift in post-Fukushima policy

The global surge in AI is placing unprecedented pressure on energy resources, with chipmakers such as TSMC consuming vast amounts of electricity to meet growing demand for advanced silicon. In response, Taiwan's government is signaling a potential shift in its longstanding opposition to nuclear energy to address its mounting power needs.

Premier Cho Jung-tai recently provided the clearest indication yet of this potential policy change, citing "surging" energy consumption driven by chipmakers and AI industries. In an interview with Bloomberg, Cho stated: "We hope Taiwan can catch up with global trends in new nuclear technologies." While this is not a definitive commitment to nuclear energy, for a country that vowed to decommission its nuclear plants after Japan's Fukushima disaster, it marks a significant change in the government's rhetoric.

Nuclear energy has been taboo in Taiwan since the 2011 Fukushima incident, which shook public confidence in the safety of nuclear reactors, particularly as Taiwan is subject to similar earthquake events. In the wake of the disaster, Taiwan pledged to phase out nuclear power by 2025. However, with the rapid increase in energy consumption from AI workloads, Premier Cho hinted that Taiwan might need to reconsider its energy strategy to remain competitive in semiconductor manufacturing. TSMC, one of the world's largest semiconductor producers, is facing an electricity price increase of approximately 12.5 percent to support its current expansion efforts.

Before committing to nuclear energy, Cho emphasized the need for a national consensus on safety measures and nuclear waste management, recognizing the potential opposition.

It's not just about keeping the chip fabs humming. Cho's comments come at a time when China's saber-rattling and military drills have heightened the fear of Taiwan being blockaded from vital energy imports. Unlike the Philippines and South Korea, which are reviving old nuclear projects, Taiwan faces a unique geopolitical challenge in balancing energy security with national defense concerns from across the Taiwan Strait.

Taiwan is not alone in considering nuclear power to meet rising energy demands. In the US, Microsoft has thrown a lifeline to the shuttered Three Mile Island nuclear plant, committing to purchasing the energy it produces once it's revived. Google and Amazon are also betting heavily on next-gen nuclear technology to power their datacenters online.

In an AI-driven global economy, where chipmakers hold significant influence, Taiwan may be compelled to reconsider its nuclear stance to maintain its leadership in the semiconductor industry. The nation's ability to navigate the delicate balance between sustaining its AI-driven growth and addressing public concerns over nuclear energy will be critical, not only for Taiwan's future but also for the stability of the global semiconductor supply chain. ®