Taiwan’s Energy Crunch: AI Boom, TSMC’s Power Hunger, and the Nuclear Dilemma (feat. China, Samsung, Intel, Energy, Semiconductors, Blackouts, Taiwan Elections, Politics and Election)

What happens when the world’s chip capital runs out of power?
Can an island that drives global AI and semiconductors keep the lights on without nuclear energy?

This isn’t just a Taiwan story—it’s a high-stakes drama pulling in Wall Street, Silicon Valley, and every rival chipmaker watching TSMC burn through electricity like it’s free.

And here’s the twist: for countries competing with Taiwan’s TSMC, this energy mess might not be bad news at all. That’s why we pulled it all together—because the future of chips, AI, and power grids is colliding right here.

Quick heads-up before we dive in: lines 1–57 explain the full history of Taiwan’s nuclear phase-out. If you already know the backstory, you can skip ahead—because what comes next is where things get really interesting.

Taiwan AI Summit Sparks a Power Plot

1. From May 24 on, Taiwan hosted the “AI Trend Insight Summit.”
2. At that event, Jensen Huang quipped, “Over the next decade, energy is the AI industry’s biggest hurdle—Taiwan has to lean back into nuclear.”

Nuclear Out, No Clout

3. Translation: That was a direct reigniting of Taiwan’s old-school nuclear debate.
4. Since 2016, the ruling party has aimed to phase out nuclear power entirely.
5. They passed laws bailing on new reactors and let existing ones age out.
6. By May 17, 2025, the last reactor—Maanshan Unit 2—went offline, and Taiwan officially went nuclear-free.

Chips Need Power: TSMC Takes the Stage

7. The reason nuclear’s back in the conversation? TSMC.
8. As of now, TSMC gobbles up roughly 8–12 percent of Taiwan’s total electricity.
9. Estimates say that could climb to nearly 24 percent by 2030.
10. And they’re not alone—Taiwan’s industrial electricity demand overall is surging.
11. Why? Because semiconductors—the island’s export powerhouse—are energy beasts.
12. In May 2024, President Lai pledged to turn Taiwan from a “silicon island” into an “AI island.”
13. Only catch: AI is a real energy-eating hippo.
14. Add AI infrastructure to existing chip factories, and power demand sky-rockets.

Cheap Power’s Shrinking Margin

15. Taiwan’s competitive edge used to be industrial electricity costs.
16. Late 2023 figures put industrial rates around 9¢/kWh—still lower than many global peers.
17. Even night rates and ultra-high-voltage rates stayed below what many countries charge.
18. Running 10 million kWh at those rates gave Taiwan a cost edge.
19. But that edge isn’t as sharp anymore.
20. Rates rose by 15 percent in 2022 and 17 percent in 2023.
21. And yes—they kept climbing in 2024 and into 2025.
22. In fact, 2024 saw another 15 percent increase, with around 10 percent more expected this year.
23. Heavy hitters like TSMC got hit harder—up to 25 percent hikes.
24. The government made a point: shield households, raise costs for industry.
25. Even with the hikes, Taiwan’s industrial rates remained cheaper than many countries—until recently.
26. With 2025’s increases, that price gap is virtually gone.
27. That means one of TSMC’s advantages over rivals like Samsung—cheaper power—is fading fast.

Energy Crunch, Renewables, and Reliability

28. It all began back in 2016.
29. That’s when the party in power kicked the nuclear phase-out into gear.
30. Earthquakes added urgency, and ex-President Tsai announced nuclear would go by 2025.
31. She proposed an energy mix of 50 percent LNG, 30 percent coal, 20 percent renewables.
32. Back then, six reactors were humming and a new one was nearly built.
33. Between 2019 and 2024, five of the six reactors shut down one by one.
34. That nearly completed reactor was axed despite being over 90 percent done.
35. So Taiwan was left with only one reactor—Maanshan Unit 2 in Pingtung.
36. That went offline in May 2025.
37. Nuclear energy went from about 20 percent to zero.
38. But renewables haven’t filled the gap.
39. The target was 20 percent renewables by 2025—actual early-2025 figures show only about 13 percent.
40. With coal sidelined for environmental reasons, Taiwan leaned heavily on natural gas.
41. Then LNG prices spiked globally, and the state utility’s deficit ballooned.
42. They restarted some coal power, boosting its share to about 35 percent, but it’s not a long-term fix.
43. In the 2024 election year, household rates barely budged—but industrial hikes piled up.
44. That’s why businesses took the hit.
45. Sure, big players like TSMC can absorb higher costs—but blackouts are another story.
46. If reserve margins fall under 10 percent, blackouts become likely.
47. Losing that last reactor pushed reserves into the 7 percent range—pretty tight.
48. Plus, Taiwan’s had four major blackouts since 2019, hitting millions.
49. President Lai suggested reopening the nuclear question—but only after 2030.
50. But once you’ve phased out a whole sector, restarting it is a tall order.
51. Think: nuclear engineering programs shut down, experts moved abroad—there’s a skills gap now.
52. Beyond business, this is a national security issue.
53. LNG imports are easy—in theory—but energy storage is another story.
54. LNG boils off fast and needs constant turnover.
55. Taiwan has about 11 days’ worth of LNG storage.
56. If a blockade lasts more than that, energy security gets very shaky.
57. That’s why Taiwan’s LNG reliance is a strategic weakness—especially with regional tensions.

Votes, Voices, and a Nuclear No-Go

58. In August 2025, the opposition party pushed a referendum on nuclear policy.
59. The vote asked whether to restart Maanshan—but it really tested public appetite for going nuclear again.
60. Taiwan had done something similar in 2021 over the Lungmen reactor.
61. That project began in 1999 with a massive $9-billion build—not a wonky million, but nine billion USD.
62. They finished building it—but never turned it on. The phase-out scrapped it.
63. On December 18, 2021, voters weighed in.
64. The result: 38.5 percent for restart, 61.5 percent against—the restart was rejected.
65. On August 23, 2025, another referendum asked about restarting Maanshan No. 3.
66. The ruling party rallied voters: “Let’s all vote no on nuclear.”
67. The result: 74 percent “yes”, 26 percent “no”, but…
68. Wait—looks like a win, but…
69. Even with such a majority, the measure failed.
70. Why? Voter turnout wasn’t high enough.
71. Taiwan’s rules say referendums need approval from 25 percent of all eligible voters, not just those who show up.
72. With about 20 million voters, that means over 5 million “yes” votes are needed.
73. They got 4.34 million, a landslide share—but not enough to pass.
74. Still, most voters seem to support going nuclear again.
75. Even in traditionally pro-phase-out regions, support was strong—60 percent in the south, 58 percent in the Maanshan area.
76. President Lai responded: “One vote doesn’t end it. Safe nuclear power needs science. If technology gets safer, waste shrinks, and society warms to it, advanced nuclear shouldn’t be ruled out.”
77. In short: for now, it’s still an anti-nuclear policy.

When Politics Meets Power, Rivals Cash In

Taiwan doesn’t just pick a president—it flips its entire political deck at once, holding presidential and legislative elections on the same day. The next showdown won’t hit until 2028, which means the ruling Democratic Progressive Party has years of breathing room to double down on its anti-nuclear stance, no matter how shaky the grid feels.
From a U.S. perspective, the timing is fascinating. Washington leans on Taiwan as the world’s semiconductor lifeline, yet its own energy insecurity could become the very crack China looks to exploit. It’s a reminder that geopolitics isn’t only about missiles and treaties—it’s also about megawatts and blackouts.
And here’s the kicker: while Taiwan wrestles with rising energy bills and the ghosts of blackout alerts, global rivals are quietly rooting for the chaos. Samsung in South Korea, Intel in the United States, and every other competitor fighting for chip market share all benefit from TSMC’s rising costs and fading edge. What looks like an energy headache in Taipei might feel like an unexpected windfall in Silicon Valley—or Seoul.
The truth is, energy policy has officially become a competitive weapon in the chip wars. And right now, TSMC’s fiercest rivals are the ones smiling.