Biden administration finalizes $6.6 billion TSMC award
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TSMC's north Phoenix facility in January 2023. Photo: Caitlin O'Hara for The Washington Post via Getty Images
The U.S. Department of Commerce finalized its CHIPS and Science Act agreement with Taiwan Semiconductor Manufacturing Co. on Friday, essentially guaranteeing the company will receive $6.6 billion to construct its $65 billion north Phoenix facility.
Why it matters: This protects the TSMC investment even if President-elect Donald Trump and congressional Republicans decide to repeal the CHIPS Act, as they've indicated they might.
The big picture: TSMC is the second company nationally to reach the final-agreement stage, which is a binding contract between the U.S. government and the company that cannot be undone without cause.
- The funds will be disbursed as the project hits milestones. A senior Biden administration official said the company should receive at least $1 billion by the end of the year.
The intrigue: The official said the award's timing was unrelated to the presidential election outcome or fear of the CHIPS Act's repeal.
- It was made now because the Department of Commerce has completed its due diligence and because of TSMC's construction progress, the official said.
What they're saying: "This will be one of the most important investments we make as a country to advance our economic and national security," Commerce Secretary Gina Raimondo said on a press call. "[It's] going to allow us to outcompete and out-innovate the rest of the world."
- In a statement, TSMC chairman and CEO C.C. Wei said the agreement will allow the company to "accelerate the development of the most advanced semiconductor manufacturing technology available in the U.S."
What's next: White House national economic adviser Lael Brainard said on the call to expect more finalized CHIPS funding agreements in the next two months.
- An administration official did not have a timeline for Arizona's two other CHIPS grant recipients, Intel and Amkor.
What we're watching: Arizona Gov. Katie Hobbs said Thursday she hopes to speak with Trump about his skepticism of the CHIPS Act and to communicate the economic importance of the program.
- "Coming from someone with an America-first agenda, this should be right at the top of the list of investments they want to continue. This is American manufacturing," Hobbs said.