Commerce Department Awards $400M in CHIPS Act Funds to Boost Chip Production

GlobalWafers is the latest semiconductor player to obtain funds available under the CHIPS and Science Act, having secured $400 million in a deal with the Commerce Department.

On Wednesday, the Biden Administration and Commerce Department announced a non-binding preliminary memorandum of terms (PMT) to provide up to $400 million in proposed direct funding under the CHIPS and Science Act. This funding aims to support domestic semiconductor wafer production and advance U.S. technology.

GlobalWafers said it plans to use the funds to construct new wafer manufacturing facilities which will create some 1,700 construction jobs and 880 manufacturing jobs once complete.

GlobalWafers plans to invest $4 billion across two sites in Sherman, Texas and St. Peters, Missouri.

The proposed plant in Texas will manufacture 300 mm silicon wafers for advanced chips, including edge and memory devices.

The Missouri site will build 300mm silicon-on-insulator wafers, designed for use in chips in harsh environments, such as in defense applications.

Of the five leading providers of silicon wafers, GlobalWafers holds more than an 80% share of the 300 mm market and is responsible for around 90% of silicon wafers sourced from East Asia.

U.S. Secretary of Commerce Gina Raimondo GlobalWafers’ said the investment will bolster the country’s semiconductor supply chain.

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“As a result of this proposed investment, the Biden-Harris Administration is helping to secure our supply chains, which will create over 2,000 jobs across Texas and Missouri and ultimately lowering costs and improving economic and national security for Americans,” Raimondo said.

GlobalWafers already has a presence in Sherman and said it plans to shift operations at the site to manufacture silicon carbide epitaxy wafers, which are used in high-voltage applications, including electric vehicles and clean energy infrastructure.

“The semiconductor wafers that will come from today’s announcement will be the foundation for the complex chips we need to compete in the global economy,” said Arati Prabhakar, director of the White House Office of Science and Technology Policy. “We’re bolstering our national security, advancing our clean energy transition and creating good jobs that support families in Texas and Missouri.”

To date, chip supplier funding has reached $30.1 billion. The Commerce Department has already signed  13 preliminary partnerships with companies including Samsung, Micron, Intel and Taiwan Semiconductor Manufacturing Co.

In addition to funding to entice suppliers to bring their chipmaking operations to the U.S., the Commerce Department is also providing funds for advanced chip research and development. 

Related:New Chip Design Paves Way to Practical Quantum Computing

This week, the Commerce Department announced the CHIPS for America’s National Advanced Packaging Manufacturing Program will offer up to $1.6 billion in funding to “establish and accelerate domestic capacity for semiconductor advanced packaging.”

This story first appeared in IoT World Today's sister publication AI Business.