Biden Administration’s Funding for Chip Technology Development
The Biden administration announced on Tuesday its plan to allocate up to $1.6 billion towards the advancement of new technology for packaging computer chips. This initiative is a significant step in U.S. efforts to maintain a competitive edge over China in the development of components crucial for applications such as artificial intelligence.
The proposed funding, which is part of the funds authorized under the 2022 CHIPS Act, aims to support companies in innovating areas like improving data transfer speed between chips in a package and enhancing heat management. Laurie Locascio, an under secretary at the Commerce Department and the director of the National Institute of Standards and Technology, highlighted the importance of this funding in driving innovation.
At an industry conference in San Francisco, Ms. Locascio announced that companies can now begin applying for grants to finance research and development projects. The grants are expected to reach up to $150 million each and will primarily focus on high-demand applications such as high-performance computing and low-power electronics, essential for advancing artificial intelligence technologies.
The CHIPS Act, which received bipartisan approval, allocated $52 billion to boost domestic chip production, with a significant portion of the funding directed towards chip manufacturing facilities. The U.S. currently accounts for only about 10% of chip production, with a substantial portion of manufacturing taking place in Asia. Of particular concern to policymakers is the reliance on foreign companies like Taiwan Semiconductor Manufacturing Company (T.S.M.C.), given China’s claims on Taiwan.
Furthermore, the U.S. faces a considerable dependency on foreign companies for chip packaging. This process involves attaching finished chips to a substrate, which includes electrical connectors, and then encasing the combination in plastic. The lack of domestic capabilities in chip packaging poses additional challenges to U.S. technological independence and security.
