Commerce Department releases $8.5 billion for semiconductor manufacturing

The U.S. Department of Commerce and a major semiconductor manufacturer have entered a preliminary memorandum of terms (PMT) to fund up to $8.5 billion in semiconductor supply chain support.

The funds come from the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act and is planned to support projects in Arizona, New Mexico, Ohio and Oregon.

The semiconductor technology industry has seen increasing demand, especially with its uses in developing artificial intelligence (AI).

The CHIPS and Science Act, signed into law in 2022, provides funding incentives to produce semiconductors domestically. Past projects funded by the program include $3 billion to the National Advanced Packaging Program (NAPMP) and a similar investment earlier this year to fund small-scale semiconductor manufacturing facilities.

“The innovation sparked by this proposed investment would strengthen America’s technological and research leadership and significantly help enhance our nation’s manufacturing capacity,” Under Secretary of Commerce for Standards and Technology Laurie E. Locascio said in a statement.

The funds will support four planned ventures:

The construction of two new logic integrated circuits (IC) fabrication facilities and the renovation of another in Chandler, Arizona.
The modernization of two fabrication facilities in Rio Rancho, New Mexico into advanced packaging facilities.
The creation of a regional chipmaking network in New Albany, Ohio, including the construction of two new fabrication facilities, expanded capabilities and diversified supply-chain.
The upgrade and expansion of technology development facilities in Hillsboro, Oregon, focusing on cutting-edge semiconductor research using High NA EUV lithography equipment.