By James Leggate for the Engineering News-Record

Semiconductor producer Wolfspeed is planning to put $750 million offered under preliminary terms from the U.S. Dept. of Commerce toward construction of one plant in North Carolina and the expansion of another in Now York, officials and the company announced Oct. 15.

The funding comes from 2022’s CHIPS and Science Act, which set $39 billion to support construction, expansion and modernization of semiconductor chip fabrication plants, known as fabs, and their suppliers in an effort to strengthen domestic supply chains. Additionally, Wolfspeed says it has reached an agreement for another $750 million in new financing from a group of investment funds, and that it expects to receive $1 billion in cash tax refunds from the CHIPS Act’s advanced manufacturing tax credit, giving it a total $2.5 billion more to invest in the projects.

“This proposed investment will enable us to solidify our leadership position with a first-of-its-kind 200 mm silicon carbide manufacturing footprint in upstate New York and central North Carolina, while contributing to the resilience and competitiveness of the U.S. supply chain,” Wolfspeed CEO Gregg Lowe said in a statement.

Durham, N.C.-based Wolfspeed already has the new $5-billion John Palmour Manufacturing Center for Silicon Carbide under construction by Whiting-Turner Contracting Co. in Siler City, N.C. The 1.2-million-sq-ft plant would produce 200 mm silicon carbide wafers. It would supply Wolfspeed’s Mohawk Valley Fab near Utica, N.Y. Production at the Siler City Plant is slated to start next year and phased completion of the full facility is scheduled by 2030.

The $1.2-billion Mohawk Valley Fab was completed in 2022 to produce 200 mm chips using 200 mm wafers. The facility received LEED BD+C: New Construction Silver certification earlier this year. Wolfspeed says it will expand the fab to meet increasing demand from the electric vehicle, telecommunications and industrial markets, but has shared few details on the scope of the project.

The announcement comes after Wolfspeed told investors in August that it is planning to shutter an existing fab producing smaller 150 mm chips in Durham, N.C., where Lowe said operating costs are higher than at the Mohawk Valley Fab. 

Wolfspeed and Commerce Dept. officials still need to finalize the funding agreement. The Biden administration has framed its effort to boost domestic chip production as key for both the economy and national security because of chips’ widespread use in technology in consumer goods, business applications and military equipment. Commerce Secretary Gina Raimondo said in a statement that the effort will also help underpin key emerging technologies such as artificial intelligence, electric vehicles and clean energy. 

“The United States is building and fortifying our semiconductor manufacturing capabilities to serve our economic and national security interests while creating jobs and economic opportunities for communities across the country,” she said.

Officials have previously announced billions of dollars in funding for other chip makers including Texas Instruments, Intel, TSMC, Micron and others.

The preceding article originally appeared on October 15, 2024 at Engineering News-Record’s website and is made available here for educational purposes only. This constitutes a ‘fair use’ of any such copyrighted material as provided for in Title 17 U.S.C. section 106A-117 of the U.S. Copyright Law.