Evaluating economic effects of semiconductor manufacturing in water-limited regions

High-volume semiconductor manufacturing (HVSM), with its associated high demands for freshwater, is often located in regions with limited water resources. This nexus of water demand and scarcity has generated concerns among municipal governments, prompting several to consider water supply restrictions as they plan for economic growth and development. By assessing water use data and economic valuations of land use from Chandler, Ariz., this study compared the economic benefit of HVSM with three alternative water uses: office, retail, and general manufacturing. Normalizing the economic benefit to net water use (after reclamation) had a marked effect on the fiscal consequences of water uses. The effects generated by mostly nonconsumptive water uses (such as HVSM and general manufacturing) increased significantly relative to less waterintensive, but more consumptive, water uses. Results showed that water-intensive land uses need not be avoided in communities where water is scarce, provided the community has the facilities necessary to reclaim the wastewater.