House bill

House Bill Funds CHIPS Act, emphasizes R&D

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Efforts to revive U.S. semiconductor manufacturing and strengthen tech supply chains advanced this week with the introduction of a catch-all bill that funds “spike production” of chips made in the United States while investing in large-scale technology R&D.

the America COMPETES Act of 2022 introduced in the House affects $52 billion in funding previously approved by the Senate and included in the latest defense authorization bill. Along with chip manufacturing, the House bill also boosts research funding in areas ranging from renewable energy and cybersecurity to AI and quantum computing.

“The House legislation will increase our investment in CHIPS, advance manufacturing at home, strengthen our supply chain, transform our research capability, and advance our competitiveness and leadership overseas,” said the president of the Chamber. the House, Nancy Pelosi, moving the legislation to the House for debate.

While funding the CHIPS Act, the House bill differs from the Senate version by placing greater emphasis on technology R&D, revitalizing America’s research infrastructure, STEM programs, and workforce development. work. Critics of the Senate version complained that it sought to duplicate China’s semiconductor manufacturing initiatives rather than focus on areas such as post-Moore’s Law transformational chip technologies.

Differences in emphasis have delayed funding for the CHIPS Act, prompting the Biden administration and the semiconductor industry to launch a lobbying campaign aimed at breaking the impasse. For example, Intel CEO Pat Gelsinger again called for passage of US chip legislation last week while announcing a fabulous $20 billion investment in Ohio.

On the same day the House legislation was introduced, the Commerce Department released data confirming “the magnitude of the semiconductor shortage,” including a decline in chip inventory of less than five days in 2021 A chip supply chain survey launched in September and published this week found that demand for integrated circuits jumped 17% between 2019 and the end of last year, while foundries were operating at more than 90% capacity utilization. Yet the growing demand for chips from automotive, consumer and medical device makers is not being met.

“The semiconductor supply chain remains fragile,” Commerce Secretary Gina Raimondo said. Arguing that tech supply chain disruptions are fueling inflation, the Biden administration cited the IC study’s findings in urging Congress to approve chipmaking legislation.

The House bill responds to pressure from the administration and industry to fund chip R&D while reviving domestic chip manufacturing as supply chain disruptions persist. Despite new U.S. initiatives announced by Intel, Samsung and Taiwan Semiconductor Manufacturing Co., each has said these investments need tax breaks and other incentives beyond what states have offered.

Industry group SEMI noted that the House bill included provisions giving vendors of IC equipment and materials access to federal subsidy programs. The grants would “strengthen the U.S. semiconductor supply chain” and “attract new manufacturing facilities — both from chipmakers and upstream suppliers,” said Ajit Manocha, president and chief executive officer. the management of SEMI.

The Senate approved separate legislation last summer that includes the $52 billion in CHIPS Act funding. The U.S. Innovation and Competition Act passed in June includes $250 billion in R&D funding, much of it shifted from National Science Foundation and Department of Energy labs to existing programs in the States of the legislators. These transfers reduced the amount of basic research funding to $29 billion.

Rep. Eddie Bernice Johnson, chairman of the House Science, Space and Technology Committee.

The House version seeks to shift the focus from technology development to basic research that proponents say will fuel future technological innovations.

While the timeline for House passage is unclear, a House-Senate conference on the chip legislation would likely set up what observers characterize as a “labs versus factories” debate. Rep. Eddie Bernice Johnson, D-Texas, chairman of the House Science, Space and Technology Committee, emphasized technological innovation and competitiveness rather than federal support for chipmakers.

The House bill was “built from the ground up with rigorous input from the scientific community on what they need most to succeed in the 21st century,” said Johnson, the bill’s lead sponsor. Bedroom.

In what appeared to be a descending list of priorities, Johnson added: “These transformative investments in science and innovation will help us revitalize our research infrastructure, create STEM opportunities for all, create energy solutions clean, to face the climate crisis, to strengthen our national Security [and] improve our semiconductor manufacturing capabilities.

Yet the initial provision of the House bill fully funds the CHIPS Act, the acronym standing for Creating Incentives Helpful to Semiconductor Production.

The full text of the America Creating Opportunities for Manufacturing, Pre-Eminence in Technology, and Economic Strength (America COMPETES) Act of 2022 is here.