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U.S. Department of Commerce offers $8.5 billion in funding under the CHIPS and Science Act for Intel’s semiconductor projects across multiple states.
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Intel anticipates benefits from a 25% U.S. Treasury Investment Tax Credit and access to federal l**** totaling $11 billion on qualified investments exceeding $100 billion.
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The proposed funding aligns with Intel’s commitment to invest over $100 billion in the U.S. over five years, vital for expanding chipmaking capacity and driving technological advancements, including AI.
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Intel’s investments are forecasted to generate over 10,000 direct company jobs and nearly 20,000 construction roles and support more than 50,000 indirect jobs within related industries.
The Biden-Harris Administration has introduced a landmark agreement with Intel, and the U.S. Department of Commerce solidified a non-binding preliminary memorandum of terms (PMT). The memorandum of terms is for an impressive $8.5 billion in direct funding designated for Intel’s commercial semiconductor ventures under the auspices of the CHIPS and Science Act.
The CHIPS Act aims to improve U.S. semiconductor manufacturing, research and development capabilities. Intel is the sole American company that designs and manufactures leading-edge logic chips. With proposed funding, Intel is poised to propel its critical semiconductor manufacturing and R&D projects across key sites in Arizona, New Mexico, Ohio, and Oregon, where it pioneers some of the globe’s most advanced chips and semiconductor packaging technologies.
“Today is a defining moment for the U.S. and Intel as we work to power the next great chapter of American semiconductor innovation. AI is supercharging the digital revolution and everything digital needs semiconductors. CHIPS Act support will help to ensure that Intel and the U.S. stay at the forefront of the AI era as we build a resilient and sustainable semiconductor supply chain to power our nation’s future.”- Intel CEO, PAT GELSINGER
This substantial influx of funds, coupled with Intel’s prior commitment of over $100 billion in investment in the U.S. over five years, marks one of the most significant public-private investments in the nation’s semiconductor industry. The historic investment is set to spawn thousands of new company positions and construction jobs, fortify U.S.-based research and development efforts, bolster domestic supply chains, and reinforce American leadership in cutting-edge semiconductor manufacturing and technology realms.
The announcement underscores the U.S. government’s faith in Intel’s leadership and dedication to enhancing U.S. chipmaking capacity and capabilities. It is a substantial investment in America’s technological future, promising innovation, opportunities, and job growth across the nation.
Under the terms of the PMT, Intel gains the option to tap into federal l**** amounting to a staggering $11 billion. Additionally, Intel plans to leverage the U.S. Treasury Department’s Investment Tax Credit (ITC), which is anticipated to cover up to 25% of qualified investments exceeding $100 billion over five years. The PMT mandates rigorous due diligence and negotiation procedures for the direct funding award and federal l****, contingent upon the accomplishment of predetermined milestones and subject to fund availability.
Innovation in Technology Leadership
Intel’s strategic focus revolves around three pillars:
- Establishing process technology leadership.
- Fortifying a more resilient, sustainable global semiconductor supply chain.
- Cultivating a world-class foundry business.
These strategic priorities seamlessly align with the objectives outlined in the CHIPS Act, which aims to foster semiconductor manufacturing and technology leadership within the United States.
In tandem with substantial investments to bolster U.S. manufacturing capabilities, Intel remains steadfast in its technological advancement process. The company is on a trajectory to introduce five semiconductor process nodes within four years. By 2025, Intel anticipates reclaiming its position at the forefront of process technology leadership with the unveiling of Intel 18A. Intel recently disclosed an extended process technology roadmap, incorporating the more sophisticated Intel 14A into its leading-edge node advancements alongside various specialized node iterations.
Pioneering Systems Foundry for the AI Era
Intel Foundry integrates Intel’s technology development, global manufacturing, and supply chain with Foundry’s customer service and ecosystem operations. This integration facilitates all the essential components customers need to design and fabricate chips tailored for the burgeoning AI-driven computing landscape. Positioned as the world’s inaugural systems foundry catering to the AI era, Intel Foundry provides comprehensive optimization from the factory network to software. It also ensures customer preparedness for Intel process and packaging designs, facilitated by extensive intellectual property and electronic design automation support from ecosystem partners.
Investments in U.S. Manufacturing and Research & Development
Intel is dedicated to channeling investments toward expanding chipmaking capabilities and capacity in its commitment to propelling the United States back to leadership in this critical industry. Proposed funding under the CHIPS Act will bolster Intel’s endeavors in key regions, including Arizona, the Silicon Desert; New Mexico, dubbed the Silicon Mesa; Ohio, emerging as the Silicon Heartland; and Oregon, recognized as the Silicon Forest.
- Arizona: Intel’s U.S. Manufacturing Powerhouse
- New Mexico: Intel’s U.S. Advanced Packaging
- Ohio: Intel’s New Leading-Edge Manufacturing Site
- Oregon: The Heart of Intel’s Semiconductor R&D
Founded in the United States, Intel boasts a legacy of over 50 years of innovation, investment, and support for global semiconductor manufacturing and research & development. With nearly 55,000 employees in the U.S., Intel’s contributions indirectly foster over 720,000 American jobs and inject more than $102 billion annually into the U.S. GDP. With the backing of CHIPS Act funding, Intel anticipates generating over 10,000 new permanent positions within the company, alongside nearly 20,000 construction jobs. These investments are poised to indirectly support over 50,000 jobs within suppliers and supporting industries.
Nurturing Semiconductor Talent and Promoting Sustainable Manufacturing
In response to the escalating demand for semiconductor expertise, Intel leads innovative collaborations with governmental bodies and educational institutions. These partnerships aim to cultivate a robust and diverse ecosystem of skilled semiconductor professionals crucial for the prosperity of the semiconductor industry and the U.S. economy. In a significant move, Intel disclosed a $100 million investment in 2022 to enhance semiconductor education, research, and workforce training nationwide. This investment includes a $50 million collaboration with the National Science Foundation and an equal sum dedicated to financing the Semiconductor Education and Research Program (SERP) for Ohio – a collaborative initiative across multiple institutions designed to support Intel’s ventures in the Silicon Heartland directly.
Recognizing the imperative of resilient and sustainable supply chains, Intel is steadfast in its commitment to emerge as the semiconductor industry’s premier sustainable foundry. Currently, Intel relies on 100% renewable electricity in its U.S. operations and has recently reinforced its pledge to achieve global reliance on renewable electricity by 2030. Furthermore, Intel has set ambitious targets, aiming for net-positive water usage and zero waste to landfills by 2030, net-zero Scope 1 and 2 greenhouse gas (GHG) emissions by 2040, and net-zero upstream Scope 3 emissions by 2050. To champion sustainability efforts, Intel convened over 100 companies across its value chain, alongside non-governmental organizations (NGOs), and representatives from governmental and academic sectors, for a global Intel Sustainability Summit on March 19 and 20. This summit was dedicated to forging a cohesive strategy to mitigate the semiconductor industry’s collective environmental footprint.
FAQs
1. What is the significance of the recent memorandum of terms between Intel and the U.S. Department of Commerce?
The memorandum of terms signifies a substantial investment of up to $8.5 billion in direct funding for Intel’s commercial semiconductor projects. It aims to bolster Intel’s contributions to the U.S. semiconductor industry, particularly in advancing chip manufacturing and research and development capabilities.
2. How will the proposed funding under the CHIPS Act impact Intel’s operations across various states?
The proposed funding will support Intel’s semiconductor investments in key regions such as Arizona, New Mexico, Ohio, and Oregon. These investments are pivotal for enhancing chipmaking capabilities and fostering technological advancements critical to economic growth and national security.
3. What are Intel’s strategies for maintaining technology leadership in the semiconductor industry?
Intel’s strategies involve establishing process technology leadership, fortifying the semiconductor supply chain, and developing a world-class foundry business. These initiatives align with the objectives of the CHIPS Act, aiming to promote semiconductor manufacturing and technology leadership in the United States.
4. How does Intel plan to address the growing demand for semiconductor talent?
Intel collaborates with government and academia to cultivate a skilled semiconductor workforce. Initiatives such as the Semiconductor Education and Research Program (SERP) in Ohio and partnerships with educational institutions aim to nurture talent crucial for the semiconductor industry’s success.
5. What steps is Intel taking towards sustainable manufacturing practices?
Intel is committed to becoming a sustainable semiconductor foundry by leveraging renewable energy sources and implementing aggressive sustainability goals. These include achieving net-positive water usage, zero waste to landfills, and net-zero greenhouse gas emissions by specific target years.
6. How will Intel’s investments impact the United States’ job creation and economic growth?
Intel’s investments are expected to generate thousands of new permanent jobs within the company and create opportunities for job growth in related industries. Additionally, these investments will contribute to economic growth by strengthening the semiconductor supply chain and fostering innovation.
7. What role does Intel envision in driving technological advancements, particularly in artificial intelligence (AI)?
As a pioneer in semiconductor technology, Intel aims to play a crucial role in driving advancements in AI-driven computing. The company’s investments and initiatives are geared toward developing cutting-edge technologies that power the next generation of AI applications.
8. How does Intel plan to ensure the success of its semiconductor manufacturing and research projects?
Intel’s approach involves collaborative efforts with government, academia, and industry partners to facilitate innovation and address challenges in semiconductor manufacturing. By fostering a conducive ecosystem and leveraging expertise, Intel aims to achieve success in its semiconductor ventures.
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