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The semiconductor industry has a problem. Demand is booming for silicon chips, which are embedded in everything from smartphones and televisions to wind turbines, but it comes at a big cost: a huge carbon footprint.

The industry presents a paradox. Meeting global climate goals will, in part, rely on semiconductors. They’re integral to electric vehicles, solar arrays and wind turbines. But chip manufacturing also contributes to the climate crisis. It requires huge amounts of energy and water – a chip fabrication plant, or fab, can use millions of gallons of water a day – and creates hazardous waste.

As the semiconductor industry finds itself increasingly under the spotlight, it is starting to grapple with its climate impacts. Last week Taiwan Semiconductor Manufacturing Company, the world’s largest chipmaker, which supplies chips to Apple, pledged to reach net zero emissions by 2050. The company aims to “broaden our green influence and drive the industry towards low-carbon sustainability”, said the TSMC chairman, Mark Lui.

But decarbonizing the industry will be a big challenge.

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The semiconductor industry's constant challenge is to make microchips that are smaller, faster, more powerful and more energy efficient — simultaneously.
On Thursday, IBM (IBM) announced it has created a 2-nanometer chip, the smallest, most powerful microchip yet developed.
Most computer chips powering devices today use 10-nanometer or 7-nanometer process technology, with some manufacturers producing 5-nanometer chips. The lower numbers denote smaller, more advanced processors. IBM's new chip uses 2-nanometer process technology, a huge leap forward for the components used to power everything from consumers' smart phones and appliances to supercomputers and transportation equipment.

"There are not many technologies or technological breakthroughs that end up lifting all boats," director of IBM Research Dario Gil said in an interview. "This is an example of one."

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