US chipmaker will invest €17B to start production in 2027.
While Intel has pledged to use only renewable electricity for the plant, that seems likely only from 2030
intel’s planned chip plant in the German city Magdeburg could at least double the city’s energy consumption when it’s up and running in 2027, two city officials told.
“The power consumption when Intel starts operating is greater than the current total power consumption of the entire city” of 240,000 people, said Lutz Trümper, former mayor of Magdeburg. The operator of the high voltage grid 50Hertz confirmed this assessment as credible. Trümper negotiated the deal that brought Intel to Magdeburg in March 2022; he left office three months later.
Intel initially plans to employ 3,000 workers and could eventually increase that to 20,000. Should the factory reach that level, its energy use will also increase.
Actual power demand from the fully operational factory could even reach “three times the energy needs of Magdeburg,” Madeleine Linke, group chair of the city’s Green party, said she and other city council members were told in a city council meeting by the former mayor.
While the project is a huge opportunity for the city, creating thousands of jobs in an area with higher-than-average unemployment, it will also require a new electricity substation to be built to help power it.
Energy is a sore point in Germany this winter after Russia largely cut off its gas supply. Public housing is lowering heating temperatures and some cities are shutting down public swimming pools and saunas as energy prices soar.
While Intel has pledged to use only renewable electricity for the plant, that seems likely only from 2030. Until then, Germany has to develop new sources of power as its remaining nuclear plants will shut down and the country tries to reduce its dependency on gas-fired power plants.
Last year, Magdeburg’s public utilities sold 1,500 gigawatt hours of electricity, 1,400 GWh of gas, and 500 GWh in district heating. And to experts, it’s no surprise that the plant will consume similar amounts of energy.
“You simply have to keep in mind how many small process steps are going on there,” said Julia Hess from think tank Stiftung Neue Verantwortung. The more complex chips become, the more energy is required to build them, she said.
Intel said it was too soon to assess energy needs for the plant, saying any estimate comparing its consumption to Magdeburg is “misleading or too inaccurate” at this stage. As soon as there are reliable figures for the Magdeburg plant, “we will also make them transparently available,” the company told .
The U.S. chipmaker is investing €17 billion in the plant, with billions more likely to come in public funding. The project answers European politicians’ call for more chips to be produced in the European Union after pandemic shortages highlighted the region’s reliance on foreign imports.
“A project of this dimension, where a company invests €17 billion in one location in such a short time, has never been seen before in Germany,” Trümper said.