US sets timetable for CHIPS Act cash

US sets timetable for CHIPS Act cash

Business news |
By Nick Flaherty

The US government is asking for applications for support for semiconductor manufacturing by February 2023 under the recently passed CHIPS Act.

Two of those initiatives will make investments in US chip manufacturing with $28bn for leading edge fabs and $10bn for more mature nodes for defence, automotive, communications technology and medical devices.

“We expect to be in a position to receive applications from companies no later than early February 2023, with a priority on funding applications for the incentives programs,” said Gina Raimondo, US Secretary of Commerce. 

“After that, we will rigorously evaluate the applications we receive and negotiate deals for successful applications. We will work to issue awards and loans as quickly as we are able to responsibly process them.”

“CHIPS funds are not intended to replace private capital and taxpayer funds will only be used to fill gaps, secure other funding and as loan guarantees,” she said. “And these funds are intended to help companies maximize the scale of their projects. Meaning, if a company already has funding for a $10 billion project, we’d like them to think bigger and tell us how our funds can help them achieve a $50 billion project. We will not hesitate to clawbacks funds if awardees fail to start or complete their projects on time or fail to meet certain commitments.”

There is also a security clause in the deal to prevent technology being shipped ot countries such as China and Russia. “CHIPS for America represents a historic investment in our domestic manufacturing industry, which has critical implications for our economic and national security. With this funding, we’re going to make sure the US is never in a position where its national security interests are compromised, or key industries are immobilized due to our inability to produce essential semiconductors here at home. We’re going to implement guardrails to ensure those who receive CHIPS funds cannot compromise national security by sending the latest technology overseas.”

“For decades, our innovation ecosystem has been in decline. This is the beginning of a new chapter in US innovation and R&D where we reverse that decline and lead the world again,” said Raimondo.

This comes as the European parliament has been debating the EU Chips Act this week, led by the Committee on Industry, Research and Energy (ITRE). This is not likely to start operation until early 2023 either, although here are key stages in October this year.

The presentation of the lead committee draft report is planned during an ITRE meeting in October 2022 and the final vote on the report in ITRE is expected to take place early in 2023. In the meantime the European Economic and Social Committee (EESC) adopted its opinion on 15 June 2022 and the European Committee of the Regions agreed a draft opinion at the meeting of the Commission for Economic Policy (ECON) of 8 July 2022. Adoption of the final opinion is expected at the 12-14 October 2022 plenary session.

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