The U.S. Commerce Dept. and Texas Instruments have reached preliminary nonbinding terms for $1.6 billion in federal funds toward construction of three TI semiconductor plants—two in Texas and one in Utah. The funds would come from the CHIPS and Science Act, Commerce announced on Aug. 16.
In addition, TI says it expects to claim between $6 billion and $8 billion in investment tax credit on the three projects, estimated at $18 billion. The company is working to grow its internal manufacturing to more than 95% by 2030, Haviv Ilan, president and CEO of TI, said in a statement.
“The historic CHIPS Act is enabling more semiconductor manufacturing capacity in the U.S., making the semiconductor ecosystem stronger and more resilient,” Ilan said.
All three projects are designed for LEED Gold certification for operational efficiency and sustainability, according to TI. Production could start as soon as 2025 at the Sherman site and 2026 at the new Lehi fab.
Austin Commercial is working on all the projects, though neither TI nor the contractor immediately responded to inquiries about construction. Work at the Sherman, Texas, site began in 2022, and TI has shared plans to later build another pair of semiconductor fabrication plants at the site. Together, the four "fabs" would contain 1.4 million sq ft of clean rooms to make 300-mm semiconductor wafers.
In Lehi, Utah, TI is building a second fab to accompany one it purchased from Micron in 2021 for $900 million. Work started last year.
TI plans to use the CHIPS funding for construction of the first Sherman fab’s clean room and first production pilot line, the shell for the second Sherman fab and the Lehi fab’s clean room.
The CHIPS and Science Act of 2022 included $39 billion to incentivize construction, expansion and modernization of fabs. The deal with TI follows similar announcements with other chip makers, such as GlobalFoundries, TSMC and Micron. The largest amount of direct funding offered through the program is $8.5 billion to Intel to support projects in four states.
U.S. Commerce Secretary Gina Raimondo said in a statement that shortages of chips during the early peaks of the COVID-19 pandemic “fueled inflation and made our country less safe.” Those shortages led to supply chain disruptions for various sectors, including automotive, industrial and defense manufacturers.
“With this proposed investment … we would help secure the supply chain for these foundational semiconductors that are used in every sector of the U.S. economy, and create thousands of jobs in Texas and Utah,” Raimondo said.
The Commerce Dept. has also put funding from the program toward construction of smaller fab projects and facilities focused on developing advanced semiconductor casing, prototyping new kinds of chips and supplying chip manufacturers.
