The US Department of Commerce announced on Wednesday that over 460 companies have expressed interest in obtaining US government semiconductor subsidy funds to enhance the country's competitiveness in the technology sector.
The White House commemorates the one-year anniversary of President Biden's landmark signing of the American Chip Act, which provides $52.7 billion in subsidies for semiconductor production, research, and labor development in the United States.
According to reports, Biden said in a statement that companies announced an investment of $166 billion in the semiconductor and electronics manufacturing industry last year. This law will once again make the United States a leader in semiconductor manufacturing, reducing reliance on other countries' electronic products or clean energy supply chains.
It is reported that the US Department of Commerce has been accepting applications for a $39 billion semiconductor manufacturing subsidy program and a subsidy program for chip manufacturing equipment and materials since June, but funds have not yet been disbursed.
US Secretary of Commerce Gina Raimondo said, "To ensure our economy and national security, we have finally made investments that should have been made long ago."
A senior official from the US Department of Commerce said, "The US Department of Commerce is taking swift action and is currently actively communicating with applicants. Significant progress is expected to be announced in the coming months."
The bill also includes a 25% investment tax credit for building chip factories, estimated to be worth $24 billion.
Last year, the US Department of Commerce formed a team of over 140 people and established rules for accepting and evaluating applications (related reading: The US Department of Commerce established an expert team to oversee the $52.7 billion subsidy under the Chip Act). The US State Department is also seeking to ensure that China does not benefit from US funding and requires companies seeking significant rewards to provide affordable high-quality childcare services and share excess profits.
It is reported that once recognized as a valuable project by the US Department of Commerce, officials must decide how much government funding to grant and how to design rewards through a combination of grants, government loans, or loan guarantees. It is reported that direct financial rewards are expected to account for 5% -15% of project capital expenditures, and the total amount of rewards generally does not exceed 35% of project capital expenditures.
In addition, the bill will allocate $11 billion for research and development in advanced semiconductor manufacturing. The US Department of Commerce stated, "The US Department of Commerce, Department of Defense, Department of Energy, and National Science Foundation are discussing establishing the center to better integrate research and labor across the entire semiconductor ecosystem."