The US Department of Commerce will soon announce its first funding opportunity for semiconductor companies under the $52 billion CHIPS Act and has urged all companies across the supply chain to submit short statements of interest and share their initial project visions.
The department said the US “must move quickly to build out leading edge facilities,” in an online advisory updated on Wednesday,
but then also laid out a three-pronged funding application process that will last well into late 2023.
Chipmakers across the US and even some from abroad are expected to clamor for funds to bring chip manufacturing and related work to the US, yet many companies are still awaiting full details on what conditions the government will require they meet.
One thing is already clear: the process will inevitably be complex and time-consuming, according to industry insiders. Some expected participants in the process have been historically critical of government funding for the private sector but cannot avoid taking part amidst the potential for a mild recession in 2023 and the probability of a 4% slowdown in chip sales for the next 12 months.
The department’s updated advisory said it will be releasing a Notice of Funding Opportunity in late February for all commercial leading edge, current and mature node fabrication facilities. At Texas Instruments, a spokeswoman said Wednesday the company would be “actively” seeking funds under the CHIPS Act for programs it qualifies for, while noting that it is “underdetermined” what benefits could be derived. Her comment came the same day TI announced an $11 billion investment in a second 300mm wafer fab in Lehi, Utah.
RELATED: TI plans $11B investment for second wafer fab in Lehi, Utah
One of the biggest requests under the CHIPS Act is expected to come from Intel, which has begun construction on two giant chip fabs in Ohio, initially valued at more than $20 billion. Intel CEO Pat Gelsinger became a principal lobbyist in favor of government funding 18 months ago, and took a similar role in pushing for government assistance in aiding chip self-sufficiency in Europe.
Commerce’s three pronged application processes
A first Notice of Funding Opportunity from Commerce is expected in late February for commercial leading edge, current and mature node fab facilities, including front-end manufacturers and back-end packaging facilities.
Then, in late spring Commerce plans to release another funding announcement focused on material suppliers and equipment manufacturers.
In early fall, Commerce plans to announce a funding opportunity to support construction of chip R&D facilities “that will further strengthen the US semiconductor manufacturing ecosystem."
Commerce said the application announcement will contain detailed guidance and timelines for organization to apply for CHIPS incentives.
Once the first funding opportunity is announced, Commerce urged all companies across the supply chain to submit a short statement of interest to inform the department of their anticipated interest in CHIPS funding “and to share initial project visions.”
The advisory appears on website of NIST (National Institute for Standards and Technology), an arm of the Department of Commerce.
Is $52 billion going to cut it?
While the $52 billion in CHIPS Act grants was condemned by many as too expensive for US coffers, some industry leaders view it as far from sufficient to bring manufacturing home to the US. The rush to apply for funds under the Commerce application process potentially gives policymakers a glimpse into how many companies are holding their hands out and for how much.
TSMC founder Morris Chang questioned if the $52 billion CHIPS Act was enough largesse in an August meeting with former House Speaker Nancy Pelosi. “Fifty billion dollars, well, that’s a good start,” he told her, according to her recollection of that meeting in an interview with Politico.