The CHIPS Act and Science: Decreasing the impact of the law 2 years later

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It’s been nearly two years since the passage of the CHIPS and Science Act, a sweeping piece of legislation aimed at boosting the country’s role in the global semiconductor industry. The law, that it provides $52 billion in production and research grants and incentives, as well as a 25% investment tax credit to encourage semiconductor manufacturing in the US, has spurred more investment in the domestic semiconductor industry.

Over the past two years, 13 companies across 23 projects in 14 states have received CHIPS grants worth nearly $30 billion in grant awards and up to $25.1 billion in loans, in follow Semiconductor Industry Association.

An important part of the motivation of the Biden administration behind the production of chips is to compete with countries like China and Taiwan, which are long-time rulers in this area.

“Our investment in chip manufacturing will put this country on track to produce nearly 20% of the world’s leading chips by the end of the decade,” Secretary of Business, Gina Raimondo said during the interview. 23 Delete the speech. Raimondo added: “It’s a big deal. “Why is that a big deal? Because my people, today we are zero. ”

To help channel billions of dollars in funding, the act also authorized and expanded the authority of the National Institute of Standards and Technology, creating within it the Office of the CHIPS Program. In April 2023, the government too established the National Institute of Semiconductor Technologya public and private organization dedicated to semiconductor research and development.

Read on for three charts that break down the top investment trends related to the CHIPS Act since the law’s passage.

Global semiconductor supply chain landscape

Since the passage of the CHIPS Act, other states have signed similar laws into law. In September 2023, the group of The European Chips Act is promised 43 billion euros of public and private investment to increase production capacity to 20% of the world market by 2030.

South Korea announced in May that it has pledged to set aside $19 billion to boost chipmaking in the country, according to Bloomberg.

Most of the world’s chip manufacturing capacity in 2020 was owned by firms headquartered in America (22%), South Korea (20%), Taiwan (19%), China (15%) and Japan (12%), respectively Congressional Research Service report.

Some of the largest investments in semiconductor manufacturing are foreign-based companies that build their facilities in the US. For example, Taiwan Semiconductor Manufacturing Co. is building three factories in Phoenix, investing more than $65 billion in totalincluding $6.6 billion in CHIPS funds.

Meanwhile, Intel aims to be global the second largest center in 2030, behind TSMC. The company accepted $8.5 billion under the CHIPS Act in March to support the construction of four fabrics in four provinces.

The the beginning of finance

The Department of Commerce began awarding CHIPS funds in December 2023.

Some of the biggest recipients so far are Intel, TSMC and Samsung Electronics.

CHIPS funding for the projects announced so far is still in the concession phase, after which NIST will discuss the details of the agreement with the company and make the final award. From advanced packaging to research and development facilities, the bottom line is the same: build a domestic US semiconductor supply chain.

Projects related to CHIPS, so far, have been widely publicized in the US regions Arizona is the state with the most investments related to legal funds, from TSMC and Intel’s major projects .

Some funds have so far been concentrated in the South and West. Texas is home to semiconductor giants Samsung Electronics, Micron Technology and GlobalWafersthey all received CHIPS money.

On the other side of the country, the East is also trying to build its manufacturing sector. In December 2023, New York established a $10 billion partnership with IBM, Micron and Applied Materials to build. R&D center the capital of the country. GlobalFoundries received $1.5 billion in CHIPS funding expanding its territory in Malta, New York, and Essex Junction, Vermont.