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The U.S. Department of Commerce announced that it will make a final award to Intel Corp. of up to nearly $7.87 billion in direct funding under the CHIPS and Science Act, the largest such grant to any company but slightly below the preliminary $8.5 billion that had been announced earlier.
The money will be split among Intel projects in Arizona, Oregon, Ohio and New Mexico, but with Arizona receiving about half of the total at $3.94 billion.
The Arizona funding will support the construction of two new factories or fabs in Chandler and the modernization of a third fab there. Intel will produce what it calls its advanced 18A semiconductors at the facility, and the federal grant will support 3,000 manufacturing jobs and 7,000 temporary construction positions in Arizona.
Commerce officials said they likely will disburse the first $1 billion to Intel before year end, without specifying how that money will be split among the four states. Further disbursements will be made as Intel meets various construction, technology, manufacturing and commercial milestones.
The Commerce Department has announced other finalized CHIPS Act agreements, including a deal worth $6.6 billion to Taiwan Semiconductor Manufacturing Co., the full amount that was previously announced, for its giant campus in northwest Phoenix.
The Biden Administration has celebrated the CHIPS Act legislation, enacted in 2022, as one of its signature achievements, but President-elect Trump has been critical of the legislation and the costs to subsidize “rich” companies including from Taiwan. Trump has called for tariffs to prod foreign manufacturers to set up factories here.
However, senior administration officials predicted that, after Trump takes office, the program will continue to be administered by CHIPS staff who are career employees rather than political appointees.
“The CHIPS for America program will supercharge American innovation and technology and make our country more secure — and Intel is playing an important role in the revitalization of the U.S. semiconductor industry through its unprecedented investments across Arizona, New Mexico, Ohio and Oregon,” said Secretary of Commerce Gina Raimondo.
President Biden visited the Intel campus in Chandler in March and the TSMC complex in December 2022.
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Since the passage of the CHIPS and Science Act in 2022 Arizona has assumed a role of growing significance in the semiconductor industry.
The Biden Administration in September announced an award of up to $3 billion to Intel as part of the Secure Enclave program that aims to expand the manufacture of advanced semiconductors for the U.S. government, with a focus on national defense. That award resulted in the reduction in CHIPS Act funding from the $8.5 billion that was preliminarily announced for Intel in March.
Intel declined up to $11 billion in low-cost federal loans that had been offered under the CHIPS Act, but the company could qualify for a federal investment tax credit of up to 25% of the cost of qualified expenses.
Beyond Chandler, an Intel factory in Oregon will receive up to $1.86 billion, company facilities in Ohio would receive $1.5 billion and an Intel operation in New Mexico is in line for $500 million. The Arizona and Ohio operates will focus on “logic” chips including 18A that control the operation of electronic devices in which they are installed.
The nearly $7.87 billion CHIPS Act grant will support Intel’s expected U.S. investment of nearly $90 billion by the end of the decade, part of a $100 billion company expansion overall, to increase capacity at the sites in Arizona and the three other states. All that could lead to another 10,000 manufacturing jobs and 20,000 construction jobs across the four states.
President Biden released a statement saying his Investing in America agenda, which includes the CHIPS Act, the Inflation Reduction Act and the Bipartisan Infrastructure Law, has helped to secure more than $1 trillion in announced private-sector investments in clean energy, semiconductors and other industries.
CHIPS for America has awarded about $18 billion of the more than $36 billion in proposed incentives that have been allocated to date, with more announcements coming. The awards span 20 states, but Arizona has nabbed around $10.5 billion, more than any other state so far.
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Publish date : 2024-11-25 22:28:00
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