The EU plans to legislate to ban the use of PFAS, and the semiconductor manufacturing industry may be affected-EEWORLD

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The European Union on Tuesday began considering a proposal to ban the widespread use of potentially harmful per- and polyfluoroalkyl substances (PFAS) known as "forever chemicals," which could have consequences for products including semiconductors. Significant impact on supply chains across multiple industries.

Because PFAS has an extremely stable chemical structure and unique chemical properties, and is both water- and oil-proof, it has long been favored by manufacturers.

PFAS have been manufactured and used in multiple industries around the world since the 1940s. PFAS can be found in commonly used products such as automobiles, textiles, medical equipment, non-stick cookware, stain removers and waterproofing agents, paints, cleaning products, food packaging, and firefighting foams.

In the semiconductor manufacturing process, the required coolant (electronic grade fluorinated liquid) is also a PFAS product. It is widely used for constant temperature cooling of semiconductor etching equipment, ion implantation equipment, and chemical vapor deposition (CVD) equipment. Although the consumption of semiconductor coolant by the semiconductor manufacturing industry is not high (coolant can be recycled, but it will leak little by little), as the semiconductor manufacturing capacity continues to grow, the demand for semiconductor coolant will continue Increase.

Research in recent decades has found strong links between PFAS and health risks such as cancer, hormone dysfunction, weakened immune systems and environmental damage.

Five European countries, including Germany and the Netherlands, have proposed that the EU phase out "forever chemicals". If passed, they said in a joint statement on Tuesday that the proposal would be "one of the largest ever bans on chemical substances in Europe."

"In the long term, banning the use of PFAS will reduce the amount of PFAS in the environment, which will also make related products and processes safer for humans," they added.

Richard Luit, senior policy adviser at the Dutch National Institute of Public Health and the Environment, said, "If no action is taken, we estimate that the social costs will far exceed the costs."

According to the proposal, the total annual health costs in Europe due to exposure to PFAS are estimated to be as high as 52 billion to 84 billion euros.

If the legislative proposal is approved, it would take effect as early as 2026. According to the draft proposal, once the ban takes effect, relevant companies will have a transition period of 18 months to 12 years to introduce PFAS alternatives, depending on the importance of the relevant industry and the availability of alternatives. Some industries, such as medical device parts, will be allowed a transition period of up to 12 years, while other general industries must adjust within 18 months.

Relevant research shows that waterproofing agents for textiles are the easiest to find alternatives. For example, paraffin can be used, but there are currently no alternatives available for some medical devices, such as pacemakers.

At present, some manufacturers and corporate users of "forever chemicals" have formed a lobby group FPP4EU under the European Chemical Manufacturers Association (CEFIC), including 14 companies including BASF, 3M, Bayer, Solvay Group, and Merck company. They said the ban would have a "huge impact" on many products used every day and the group would advise on areas in urgent need of exemptions in a public consultation.

Jonathan Crozier, FPP4EU’s advocacy and communications chair, said: “The main concern of FPP4EU is that the proposals could disrupt some supply chains.”

Semiconductor manufacturing industry may suffer impact

On the list of industries that may be disrupted by the "permanent chemicals" ban, the chip industry is undoubtedly on the list. Some local chip suppliers in Europe have warned this week that the EU's ban on "forever chemicals" will cause widespread damage to the already strained semiconductor supply chain.

Chemours, a major supplier of high-end fluoropolymers, warned that these "forever chemicals" are "absolutely critical" to semiconductor manufacturing and a wide range of other industries.

Denise Dignam, director of high-performance materials at Chemours, said, "If we don't have these, there will be very serious chaos in the world. I can't imagine how you would do those (semiconductor) manufacturing processes without these materials."

Iwaki, a leading global manufacturer of chemical handling pumps, said restrictions at the European level could lead to "more disruption and ultimately higher prices" due to supply shortages and rising costs.

Proposals unveiled on Tuesday predict that the electronics industry's use of "forever chemicals" will grow at an annual rate of 10%, driven mainly by soaring demand for chips. As chipmakers expand production capacity, some of the most critical PFAS have already experienced supply shortages.

Semiconductor industry executives said that in the past two years, the price of PFA fluoropolymer, one of the most critical PFAS derivatives used in chip manufacturing, has soared by 70%-80% due to supply shortages caused by strong demand. Despite the current slump in the chip industry, prices are expected to rise by a further 20% this year.

In fact, if the EU does ultimately decide to implement a PFAS ban, parts of the semiconductor industry and its supply chain are trying to put themselves on the longer-term 12-year transition period list, rather than the more urgent 18 months.

Chemours’ Dignam warned that “regulators must consider the entire supply chain when considering a ban because chips are vital to everything from cars to mobile phones. Trying to regulate a class of chemicals is as daunting as trying to regulate diesel or olive oil.” ”

According to TheElec, 3M, the world's largest coolant manufacturer, previously announced that it would stop producing coolant by 2025 in accordance with environmental regulations. Currently, 3M dominates the chip coolant market with a market share of up to 90%; the second largest producer is the Belgian company Solvay.

In March last year, the Belgian government ordered 3M to cease operations at its coolant plant in Flanders because it failed to meet increased PFAS emissions standards. Initially, 3M tried to find a solution to use less PFAS, but late last year 3M announced that it would completely stop producing PFAS by the end of 2025.

Until now, South Korean chipmakers Samsung and SK Hynix have relied heavily on 3M's coolant supplies to produce chips. They are expected to find alternative solutions, such as using electric chillers that use less coolant than refrigerator-type chillers, sources said. Gas-cooled substances that do away with coolants entirely will also be considered, they added.

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