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Biden To Honor Intel With CHIPS Act Award, Elevating Arizona As a Semiconductor Powerhouse Biden To Honor Intel With CHIPS Act Award, Elevating Arizona As a Semiconductor Powerhouse

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    Biden To Honor Intel With CHIPS Act Award, Elevating Arizona As a Semiconductor Powerhouse

Revered President Joe Biden is poised to present a multi-billion dollar award to semiconductor titan Intel Corporation INTC to amplify semiconductor production across the United States.

This move is in line with the CHIPS and Science Act, a considerable $280 billion package put into effect by Biden in 2022.

Anticipated to be announced in conjunction with Commerce Secretary Gina Raimondo, the award underscores Intel’s commitment to innovation.

Intel made waves in October by commencing the construction of a cutting-edge fabrication plant at its esteemed Ocotillo campus in Chandler, Arizona. The company’s ambitious blueprint includes the establishment of two additional fabs, with costs estimated at an impressive $20 billion.

Reporting from Reuters suggests that the award granted to Intel is likely to embody a fusion of loans and grants sourced from the government’s $53 billion CHIPS and Science Act fund. The magnanimous award is expected to be the most substantial yet conferred under the 2022 Act, designed to diminish the United States’ reliance on critical technological components procured from overseas.

Recently, GlobalFoundries Inc GFS secured a notable $1.5 billion from CHIPS Act grants to fortify its production capabilities in Malta, New York. The financial injection is set to support the construction of a groundbreaking fab, illustrating the trajectory of growth in the semiconductor sector.

Also Read: GlobalFoundries To Scoop $1.5 Billion In CHIPS Act Grants: What It Means For Semiconductor Sector

TSMC And Samsung Up Next?

The Biden Administration is primed to unveil a series of fresh grants from the fund in the ensuing weeks, earmarking roughly $5 billion for tech luminary Taiwan Semiconductor Manufacturing Corp. TSM. This investment aligns with TSMC’s grand scheme of investing a whopping $40 billion in two fabs situated near Phoenix, Arizona.

Arizona, unfalteringly, is asserting itself as a key epicenter for semiconductor production. Its roots in technology can be traced back to 1949 when Motorola established a laboratory dedicated to pioneering transistors for electrical equipment.

Beyond behemoths like Intel and TSMC, the state boasts a roster of over a hundred other chip-focused entities, including NXP Semiconductors NXPI, showcasing a robust talent pool for manufacturers to tap into.

Rumor has it that South Korean juggernaut Samsung is poised to clinch a CHIPS Act grant, potentially paving the way for the establishment of a multibillion-dollar fab in Arizona.

State of Semiconductor Bliss

So, what makes the Copper State such a sought-after destination? It’s a fusion of climate, geology, and geography.

Arizona boasts an arid climate, ideal for semiconductor fabs that necessitate low humidity levels, making it a cost-effective choice for companies in the sector.

The region is also deemed low-risk when it comes to natural disasters, mitigating concerns related to earthquakes, floods, and hurricanes.

Moreover, its proximity to the Palo Verde Nuclear Generating Station guarantees a stable and dependable power supply for fabs in the vicinity. Additionally, sharing a border with California, home to numerous tech giants, positions Arizona as a strategic hub for semiconductor production.

Another pivotal factor is Arizona’s status as a critical swing state, instrumental in Biden’s clinching of the past presidential election against former President Donald Trump.

Chip stocks have notably shone in 2024, experiencing a slight pullback in recent days. The VanEck Semiconductor ETF SMH, housing TSMC, Intel, and tech titan Nvidia Corporation NVDA, has surged by 28% this year.

Now Read: TSMC To Win $5B Grant For US Plant To Service Apple, Nvidia Chip Demand: Report