NLOG-280 | Semiconductor And Beyond Newsletter | The Semiconductor Energy Bottleneck

Chetan Arvind Patil
November 30, 2025

The Semiconductor Energy Bottleneck

The semiconductor industry sits at a paradox: transistors shrink, but the energy per wafer, per model, and per compute operation explodes.

Fab operators, hyperscalers, and packaging houses are quietly confronting a simple truth: energy, not lithography, is becoming the defining bottleneck of the 2030s.

From ASML NXE EUV scanners hitting 1.8–2.0 MW per tool (2023–2025 reports) to TSMC’s 3 nm fabs crossing 1.2–1.5 TWh/year energy footprints, every new performance node deepens the power curve.

And with AI workloads projected by IEA (2024) to consume 10× more datacenter electricity by 2030, device-level efficiency is no longer an engineering metric.

It is an economic constraint. Let us learn about the implications.

The Fab-Level Energy Wall

From 2019 to 2025, EUV became the dominant force reshaping fab power profiles. As 5 nm and 3 nm lines expanded, multi-megawatt EUV tools and rising layer counts pushed electricity demand beyond historical scaling trends.

Data from imec, ASML, and IRDS (2020–2024) show that while deposition and etch remain the largest overall consumers, EUV is now the fastest-growing load, requiring continuous grid reinforcement in regions that manufacture and use EUVs.

Image Credit: ASML

The underlying shift is structural: each new node inherits a higher energy baseline, driven not by volume, but by the physics and infrastructure demands of EUV itself.

When AI Model Consumes More Energy Than The Fab That Built It

By 2024 and 2025, a notable inversion became visible across public technical estimates.

The electricity required to train a frontier-scale AI model began to reach or exceed the annual energy used to manufacture the accelerators that perform that training.

Training clusters operating for weeks at very high utilization now sit in the same energy range as complete EUV wafer cycles supplying the underlying silicon.

A simplified comparison table is included below.

Metric or Scenario	Approximate Energy or Power Draw	Notes
Growth rate of training compute for leading AI models	Increases of several times per year	Reflects rapid expansion in model scale
Growth rate of power draw for large AI clusters	Nearly doubling year over year	Driven by rising hardware density and thermal load
Estimated peak power for frontier training runs	Often above one hundred megawatts	Represents sustained operation across multiweek windows
Relative per query inference cost	Measured in fractions of a watt hour	Efficiency gains offset only a portion of total demand

This crossover marks a structural shift. The computational lifecycle of a model can now surpass the electrical cost of producing the chips that enable it.

Thus, compute demand becomes the dominant force in energy growth, overtaking fabrication complexity as the primary driver in advanced technology environments.

From Transistors-Per-Dollar To Energy-Per-Transistor

Energy has become the quiet scarcity variable shaping the future of semiconductors. Process advances have not removed this constraint; they have intensified it.

Every new node inherits a higher baseline, and every new compute workload amplifies it.

The fabs producing AI silicon and the data centers that run it are converging toward the same ceiling. What once separated manufacturing energy from computational energy is now a single curve.

At its peak, fabrication sets the cost of creating capability. Once deployed, computation sets the cost of using it.

Leadership will shift to the companies and nations that embed energy efficiency at the architectural level rather than at the margins. The competitive frontier moves from transistors per dollar to energy per transistor, and from compute scale to compute discipline.

Those who solve for energy first will define the next decade of semiconductor progress.

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NLOG-280 | Semiconductor And Beyond Newsletter | The Semiconductor Energy Bottleneck

The Semiconductor Energy Bottleneck

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