Taiwan Semiconductor (TSM) Stock Signs 30-Year Wind Power Deal With Northland Power

TLDR

• Northland Power has signed a 30-year power purchase agreement with TSMC for its Hai Long 2A offshore wind site in Taiwan
• TSMC will take 100% of the 294-megawatt site’s output, expanding a partnership that began in 2022
• The Hai Long project has a combined gross capacity of 1,022 megawatts across three sites
• TSM stock is trading near its 52-week low, down 54% over the past six months
• GuruFocus rates TSM as 44.2% overvalued based on its GF Value model, with a current price of $393.83 vs. a fair value of $273.09

Taiwan Semiconductor Manufacturing (TSM) has signed a new 30-year power deal with Northland Power, locking in 100% of the output from the Hai Long 2A offshore wind site in Taiwan. The agreement expands an existing relationship between the two companies that dates back to 2022.

Taiwan Semiconductor Manufacturing Company Limited, TSM

Hai Long 2A is a 294-megawatt offshore wind site located roughly 45 to 70 kilometers off the Changhua coast in the Taiwan Strait. TSMC already buys power from the Hai Long 2B and 3 sites, making this the third leg of its renewable energy commitment with the project.

The full Hai Long project carries a combined gross capacity of 1,022 megawatts. It is being developed by Northland Power (30.6%), Mitsui & Co. (40%), and Gentari International Renewables (29.4%).

The deal takes effect following the completion of administrative procedures expected later in 2026. Northland CEO Christine Healy said the agreement “enhances the project’s long-term economic fundamentals” and contributes to value creation for Northland’s investors.

For TSMC, the deal reflects its ongoing push to secure renewable energy as power demand from AI-driven chip production continues to climb. The company holds roughly 70% of the global advanced foundry market as of 2025.

Supply Crunch Still Squeezing TSMC

A TrendForce report published April 30 flagged persistent bottlenecks in semiconductor manufacturing. The core issue is a shortage in CoWoS packaging technology, which is essential for producing the kind of advanced chips used in AI systems.

TSMC is the sole supplier of 3nm processes and a critical player in the 2nm pipeline. The CoWoS shortage is not expected to ease until at least 2027, even as the company works to expand capacity.

Major clients including Apple, NVIDIA, and AMD all compete for limited production slots. With AI compute demand still accelerating, TSMC’s ability to scale fast enough remains a live question.

Valuation Concerns Hang Over the Stock

TSM is currently trading at $393.83. GuruFocus puts its GF Value — an estimate of intrinsic worth — at $273.09, which means the stock is trading at a 44.2% premium to that model’s fair value.

The trailing twelve-month P/E ratio stands at 32.72x, well above the five-year median of 22.78x. GuruFocus gives TSM a Valuation rank of just 5 out of 10.

That said, the company scores near the top in other areas. It holds a 10/10 in both Profitability and Growth, and a 9/10 in Financial Strength. The GF Score overall is 97 out of 100.

Insider activity over the past three months shows $827,355 in purchases with no reported sales.

TSM stock is down 54% over the past six months and sitting near its 52-week low. InvestingPro has flagged the stock as potentially undervalued at current levels — a view that sits in direct contrast to the GuruFocus model.

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