CHIPS Act draws over 460 applicants for semiconductor manufacturing funding

The U.S. Department of Commerce’s CHIPS Program Office has received over 460 applications for domestic semiconductor manufacturing and related projects, Commerce Sec. Gina Raimondo said last week.

The applications are for the first round of federal funding from the $39 billion pot provided by the CHIPS and Science Act, meant to incentivize semiconductor manufacturers to produce in the U.S.

The federal agency initially announced the program in February for manufacturing facilities and expanded it months later to include investments in semiconductor materials and manufacturing equipment projects valued at or above $300 million. Raimondo said companies that have yet to apply are encouraged to do so.

Two additional funding opportunities — one for materials and manufacturing equipment factories with investments below $300 million and another for R&D facilities — will be announced later this year, according to the National Institute of Standards and Technology. 

“In the year since I signed this legislation into law, companies have announced over $166 billion to bring semiconductor manufacturing back to the United States,” President Joe Biden said in a statement on Wednesday. “These investments are creating jobs and opportunities in communities across the country – from Ohio to Arizona, Texas and New York.”

A senior official at the Commerce Department did not say when the CHIPS for America program would announce the funding awards, noting it depends on how quickly federal officials can assess application materials and reach an agreement with prospective grantees.

Still, the official said the Commerce Department expects to announce significant progress on awarding funds in the months ahead.

“It’s not a small task,” Raimondo said. “It’s a historic amount of responsibility for us here at the Commerce Department, but we’re up to it.”

The tremendous interest in the CHIPS for America program means federal officials will have tough choices in terms of how they allocate the funds, the senior Commerce Department official said.

The department’s goal is to focus on projects critical to the U.S. workforce, research and development and economic security, Raimondo said. However, as many of the projects will remain primarily funded by private sector capital, the department will also seek to fund projects where federal allotment would be needed to incentivize the investment.

“We are focused on being efficient, fast and responsible,” Raimondo said. “As I say to my team, we need to move quickly. But it’s more important that we get it right. We can’t afford mistakes given how high the stakes are.”

Since the CHIPS Act was enacted last year, the Commerce Department has created two CHIPS offices and recruited about 140 people, Raimondo said, responsible for doling out federal investment in the semiconductor industry. 

The agency’s National Institute of Standards and Technology also released a vision and strategy paper in April for the National Semiconductor Technology Center, a research and development program that will serve as an independent nonprofit entity.

The NSTC will be a partnership between the Departments of Commerce, Energy and the National Science Foundation, which will support and extend U.S. leadership in semiconductor research, design, engineering and advanced manufacturing through public and private partnerships, the agencies said in a joint statement on Wednesday.

In June, the CHIPS for America team announced a selection committee that will choose board members with R&D and board governance experience to form the National Semiconductor Technology Center.

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