CHIPS grant to Polar for $120M would double its sensor, power chip work

Polar Semiconductor became the latest recipient of a preliminary CHIPS Act grant, this time for $120 million to double its US production capacity of sensor and power chips within two years at an expanded facility in Bloomington, Minn.

While much smaller in dollars than several of the multibillion-dollar CHIPS Act preliminary grants, the deal allows Polar to bring in $450 million in US-based private capital and $75 million from the state of Minnesota to help transform it from a majority foreign-owned in-house manufacturer to a majority US-owned commercial foundry. The move is expected to expand ways for US chip designers to produce new technologies within the US.

Commerce Department and NIST officials said the Polar technology will matter in high-voltage applications across aerospace, automotive and defense industries. Polar President Surya Iyer said the expansion will allow the company to increase capacity and branch into new technologies. Polar is expected to claim a federal investment tax credit of up to 25% of capital expenditures. The project is expected to create 160 manufacturing and construction jobs in Minnesota.

President Biden signed the CHIPS and Science Act into law in August 2022 to strengthen US supply chains. Commerce officials noted that power and sensor chips faced some of the most acute bottlenecks during the pandemic. Bolstering the supply chain is expected to help strengthen national security with a chip supply for defense purposes.

Commerce has received more than 650 statements of interest for funding. Officials have already doled out nearly $30 billion in preliminary grants and up to $25 billion in loans to seven companies across 16 projects in 10 states, according to a recent CHIPS Program Office update.

Preliminary grants to chip makers for facilities in the US have included Intel ($8.5 billion), TSMC ($6.6B), Samsung ($6.4B) , Micron ($6.14B) and GlobalFoundries ($1.5B).

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