Even though ICs rule the world of electronics, the transistor does all the work. Within each IC are millions upon millions of transistors perpetually switching on and off so that the IC can carry out its intended functions. Even if one of the multitudes of transistors were to stop switching, the IC could lose part or all of its functionality.
Circuits handling digital signals most often use transistors to switch from a high state to a low state and vice versa. It is usual to call a circuit point as being in a high state if the voltage at that point is close to the supply voltage. If the circuit point is closer to the ground or zero voltage, we generally call it as being at a low state. The time taken for the transistor to switch from a high to a low state or vice versa is its switching rate. While the transistor does not expend much energy when at either the low or the high state, the same cannot be said for the time when it is actually switching.
Under ideal conditions, a transistor should switch instantaneously. That means the transistor should take zero seconds to change its state. However, ideal conditions do not happen in reality and the transistor takes a finite time, however small, to actually switch over.
Transistors are made of semiconductor material and each junction has a finite capacitance and resistance. Junction capacitances store energy and the combination of resistance and capacitance acts to slow down switching – the capacitance must fill up or empty itself before the transistor can flip. The rate at which the capacitance fills up or empties itself depends on the junction resistance.
The situation gets worse as the switching frequency goes up. As the transistor is driven to toggle faster and faster, the junction capacitance may not get enough time to discharge or charge up fully. That defines the maximum switching rate the transistor can achieve.
Semiconductor manufacturers use various methods to reduce junction capacitances and resistances to induce these special semiconductors switch faster. Although modern semiconductors (transistors and diodes) are capable of switching at MHz or GHz scales, the cumulative effect of the tiny switching losses add up to increase the junction temperature.
Power is the product of voltage and current. When a semiconductor is in a high state, although the voltage is high, the current is negligible and consequently, the power drawn from the supply is negligible. When the semiconductor is a low state, its voltage is close to the ground level and the product of current and voltage is again negligible.
However, during switching, when the voltage is somewhere in-between the supply and ground levels, the current drawn also increases. That makes the product of voltage and current have a significant value and the semiconductor generates heat because of the power consumption. With higher frequencies, this happens more frequently and the heat accumulates to produce higher junction temperature.
If the natural process of heat dissipation can remove the accumulated heat, the semiconductor soon reaches a steady temperature. Else, heatsinks and or forced cooling methods are necessary to remove the heat accumulated.