Biden-Harris Administration announces chip production expansion with new incentive awards

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Biden-Harris Administration announces chip production expansion with new incentive awards

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Laurie E. Locascio Director of NIST and the Under Secretary of Commerce for Standards and Technology | Official Website

The Biden-Harris Administration has announced two awards under the CHIPS Incentives Program, aimed at bolstering the U.S. semiconductor supply chain crucial for national security and the space industry. The U.S. Department of Commerce finalized these awards with BAE Systems Electronic Systems and Rocket Lab.

BAE Systems Electronic Systems, a division of BAE Systems, Inc., will receive up to $35.5 million in direct funding. Rocket Lab, parent company of SolAero Technologies Corp., is set to receive up to $23.9 million. These awards follow preliminary agreements signed in December 2023 and June 2024, and the completion of due diligence by the Department of Commerce. Funds will be released as project milestones are achieved.

Laurie E. Locascio, Under Secretary of Commerce for Standards and Technology and Director of the National Institute of Standards and Technology (NIST), stated: “From satellites in space to defense systems on the ground, our most advanced defense and commercial technology rely on mature-node and compound semiconductors to operate.” She emphasized that these awards would strengthen America's domestic semiconductor supply chain resilience.

Arati Prabhakar, Assistant to the President for Science and Technology, highlighted the significance of these investments: “America's space and military systems are the most capable in the world, and that would not be possible without advanced semiconductor technology.”

Cheryl Paradis from BAE Systems commented on their project's impact: “This investment marks a significant step forward for the modernization of our Microelectronics Center, enhancing our national security.” Meanwhile, Brad Clevenger from Rocket Lab remarked: “We’re proud to be a part of this effort... This award will help ensure U.S. leadership in compound semiconductor manufacturing capability.”

The CHIPS program aims to distribute funds based on capital expenditures tied to construction, production, and commercial milestones. It also involves tracking performance through financial reports.

CHIPS for America has already allocated over $10 billion out of a proposed $36 billion incentives fund across 20 states. This initiative is expected to create over 125,000 jobs nationwide since its inception under President Biden’s administration.

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