Liying Environmental Protection Technology (立盈環保科技) is a small firm with a team of just 21 employees. Its core operation involves converting calcium fluoride sludge, a primary waste from TSMC's intricate semiconductor manufacturing process, into artificial fluorite—a valuable additive in steel production. Its triumph in commercializing the recycling process has garnered orders from steel plants of China Steel and Formosa Plastics Group in Vietnam.

Last year, TSMC invited Liying to establish a facility within the "zero waste manufacturing center" located in the Central Taiwan Science Park. This strategic move allows the annual 130,000 tons of TSMC-produced waste to undergo on-site processing.

Nearly two decades ago, China Steel had explored collaborations with semiconductor companies to transform their calcium fluoride sludge into artificial fluorite. However, that initiative did not materialize. So, what has Liying done to appease both TSMC and China Steel? The story has its roots in 2005.

China Steel's Subsidiary Paves the Way for Liying

Historically, fluorine was a theorized agent for purifying liquid iron during steel manufacturing. In 2005, China Steel proposed a collaboration with TSMC and other semiconductor firms. They aimed to utilize fluorine-rich waste for artificial fluorite production, enhancing the purification of molten metal. However, due to concerns over a consistent supply chain, the agreement did not proceed.

Despite this setback, Union Steel Development (聯鋼開發), a subsidiary of China Steel, remained persistent in their quest for sustainable resources.

Liying's CEO, Chun-chi Chen (陳俊琦), comes from a finance background. With a relative in the waste recycling business, Chen found himself in a unique position when Union Steel Development approached them in 2009. Recognizing a potential business opportunity, Chen spearheaded the research project, with guidance from experts provided by Union Steel Development.

Chen fondly remembers their early prototypes: the initial artificial fluorite sticks were fragile, breaking easily upon impact. After two months of persistent effort, they eventually matched China Steel's durability standards. This achievement involved several design iterations, evolving from a hotdog shape to the final flattened ball form.

(Source: Chien-Tong Wang)

While refining the product was an accomplishment, convincing potential clients presented another set of challenges. Union Steel Development presented the fluorite to China Steel, where it faced a barrage of criticism.

Exemplary Results at Half the Price

Previously, steelmakers employed natural fluorite for impurity removal. Transitioning to artificial fluorite required revisiting and revising long-established practices.

Tse-wei Hsu (許澤位), China Steel's Assistant General Manager of Productions, emphasizes the company's stringent manufacturing protocols. He explains, "All new processes undergo rigorous testing on small scales. Only after prolonged testing, where quality assurance is beyond reproach, do we initiate mass production."

Chen reiterates the stakes involved, explaining that a minor deviation in the procedure could lead to losses amounting to tens of millions. The initial skepticism intensified when technicians learned that the artificial fluorite sticks were crafted from recycled etchant containing hydrofluoric acid, fearing potential harm upon contact.

To assuage these concerns, Chen procured composition analysis reports, demonstrating the safety of artificial fluorite. Despite reservations, a plant manager at China Steel subsidiary Dragon Steel offered to pilot test the new additive.

Chen commenced by dispatching a small batch of artificial fluorite. The results were astonishing. The artificial fluorite excelled at purging impurities, delivering consistent, high-quality steel. Currently, artificial fluorite accounts for over 80% of the fluorite they utilize, with purchases exceeding 100,000 tons.

Liying's ascendancy within China Steel can be partly attributed to geopolitics. The majority of natural fluorite imports come from China, which imposed export restrictions in 2010. Consequently, the mineral's price nearly doubled over the decade, currently standing at NT$12,000 (US$400) per ton. Artificial fluorite offers a cost-effective alternative at half the price. Initial successes with smaller batches bolstered China Steel's confidence in Taiwanese-made artificial fluorite.

Market share over 50%

Liying's operations are based in Pingzhen, Taoyuan. Despite being housed in older buildings, the state-of-the-art machinery is continuously operational. The facility processes sludge deliveries from industry giants like TSMC, UMC, Micron, VIS, and Nanya Technology.

According to Chen, TSMC is continually inquiring about expansion possibilities. The semiconductor behemoth promptly capitalizes on any new capacity Liying offers.

The sludge's primary component is a potent etchant composed of hydrofluoric acid, used for semiconductor wafer cleaning and etching. To neutralize this hazardous compound, semiconductor companies introduce additives, converting it into benign calcium fluoride sludge. Post water-extraction, the solidified waste is transported to Liying for its transformation into artificial fluorite.

(Source: Chien-Tong Wang)

Currently, Liying processes approximately 1,500 tons of calcium fluoride sludge monthly, with 40% originating from TSMC. This processing translates to an 800-ton output of artificial fluorite. Major customers include Formosa Plastics' steel plant in Vietnam, China Steel, and Yieh United Steel. Remarkably, Liying sources over 40% of its revenue from waste handling service charges and about 30% from artificial fluorite sales. Of the four Taiwanese firms manufacturing artificial fluorite, Liying commands an impressive market share of over 50%.

Prioritizing transparency for client satisfaction

Before Liying's emergence, the semiconductor industry annually produced thousands of tons of sludge. This waste typically found its way to cement companies as raw material or was disposed of in landfills. However, revelations about flawed disposal methodologies highlighted the need for better waste management solutions.

In 2015, CommonWealth Magazine unveiled an exposé titled "High-Tech Waste Out of Control." The narrative focused on the semiconductor sector's challenges in waste management. Given the established methodologies' inefficacy, semiconductor corporations began actively exploring alternative waste management solutions. This search laid the foundation for the partnership between TSMC and Liying.

TSMC attests that compared to the previous method of redirecting sludge to cement manufacturers, the current practice is vastly superior. It not only enhances the value derived from high-end industrial materials but also mitigates the risk of illicit waste disposal.

In 2019, TSMC entrusted Liying with a modest initial sludge batch weighing just a few dozen tons.

Chen understood the underlying apprehensions. TSMC was keen on verifying if Liying was genuinely processing and marketing the waste, rather than merely stockpiling or unlawfully disposing of it.

Chen's strategy was twofold: first, secure buyers for the artificial fluorite, and then reconnect with TSMC. As China Steel and Formosa Plastics began purchasing substantial quantities, TSMC's monthly sludge deliveries to Liying surged, each shipment weighing in the hundreds of tons.

The Next Leap in Circular Economy: Repurposing Waste as Raw Material

In addition to their innovative waste treatment method, TSMC and Liying are collaborating on another pivotal project.

Achieving the zenith of the "circular economy" involves repurposing waste as valuable raw materials. Chen elaborates on their ambitious vision, "Our ongoing research is centered on rejuvenating used hydrofluoric acid to meet the standards of electronic-grade hydrofluoric acid, making it fit for reuse in semiconductor manufacturing."

Purifying waste fluids to achieve this goal necessitates substantial investment in cutting-edge technologies.

However, for TSMC, this future is nearly within grasp. The company divulged to CommonWealth Magazine that the products from the 'zero waste manufacturing center' already closely align with semiconductor manufacturing requirements. A little more refinement and quality verification will enable this method's integration into the primary production line.

Besides TSMC, United Microelectronics Corporation (UMC) is also launching the "Circular Economy & Recycling Innovation Center" within the Southern Taiwan Science Park. In the foreseeable future, Liying will play a pivotal role in managing the 500 tons of calcium fluoride sludge UMC generates monthly.

While materials and technologies are indispensable, the ultimate success determinant for promoting the "circular economy" is the business model's viability. Liying's journey underscores that a sustainable, eco-friendly future is indeed attainable.

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Translated by Jack Chou
Uploaded by Ian Huang