Senate’s $280 billion tech bill benefits Montana businesses

Senate’s $280 billion tech bill benefits Montana businesses
Senate’s $280 billion tech bill benefits Montana businesses

TOM LUTEY

The $280 billion high-tech manufacturing and research bill passed by the Senate on Wednesday is expected to spur growth in Montana.

Scripted between America’s tech industry and its reliance on foreign-made semiconductors, the CHIPS and Science Act invests $52 billion in the domestic semiconductor manufacturing industry, including upstream services like those provided by technology manufacturers in Bozeman, Butte and Kalispell.

“Basically, more semiconductor manufacturing in the United States will be a benefit for us,” said Chuck Sutton, vice president of sales and marketing at REC Silicon, which has a plant near Butte.

The bill passed 64 to 33 votes with both Montana senators, Jon Tester, a Democrat, and Steve Daines, a Republican, in favor of the spending. Sutton said he worked with the two senators on issues important to the company’s operations in Montana.

REC’s manufacturing facility near Butte is the world’s largest supplier of silane gas and other specialty gases used in semiconductor production. The factory employs around 200 people. Butte’s operations were a bright spot for the company as U.S.-China trade disputes shut the door on U.S. sales of polysilicon to solar panel makers in China, a problem that started with tariffs of the Obama era on cheap Chinese solar panels, then got worse under Trump. -era of the US-China trade war.

In 2018, the US Trade Representative imposed 25% tariffs on semiconductor products from China, as China retaliated with its own tariffs. It was during this period that REC’s polysilicon operation in Moses Lake, Washington had to close.

The challenges posed by technological manufacturing in China continue to guide US policy. Concerns over the United States’ overreliance on Chinese-produced semiconductors were the origin of the CHIPS and Science Act. Daines noted in a press release after Wednesday’s vote that the United States’ share of semiconductor production fell to 12% in 2020 from 37% in 1990.

Meanwhile, China’s share of semiconductor production is on the rise and is expected to reach 24% by the end of the decade, as its government directly subsidizes industry development with 1.4 trillion. between 2020 and 2025, according to a report released earlier this year by the Future Supply Chain Foundation.

Global manufacturing and shipping challenges resulting from the COVID-19 pandemic have made the United States’ reliance on foreign semiconductors painfully obvious. In April, speaking to the Lee Montana newspapers and other Rocky Mountain outlets, U.S. Commerce Secretary Gina Raimondo said manufacturers nationwide had a five-day supply of semiconductors.

“Even more alarmingly, 90% of the most advanced chips in the world are made in Taiwan, in fact only one company in Taiwan. These are the chips we need for military equipment, artificial intelligence, quantum computing, communication devices, and they are almost all made in Taiwan. Our extreme dependence on other countries for semiconductors means that we are very vulnerable.

In June 2021, COVID shutdowns at the world’s largest semiconductor maker in Taiwan stifled the global supply of computer chips.

There are signs that American tech is gearing up for a surge in manufacturing if the CHIPS and Science Act is signed into law by President Joe Biden. The bill must pass through the House as approved by the Senate. An earlier version passed by the House was more than the Senate could muster the 60 votes required to pass.

In late June, semiconductor makers Intel, TSMC and Global Foundries announced they would scale back manufacturing expansion plans if the CHIPS and Science Act is not passed. The Wall Street Journal reported that Intel’s $20 billion investment in Ohio chipmaking was on hold until Congress takes action. Applied Materials, which employs more than 600 people in Kalispell, is a major supplier to Intel. In May, AM cut the ribbon on a former Shopko building where it plans to add 200 workers.

REC is optimistic about the rise of tech manufacturing. Sutton said the company’s plant in Moses Lake will reopen, a process that will require staffing the plant with 75 workers initially, with another 100 to follow as production improves. Domestic demand for polysilicon is an important part of the reopening, specifically US demand for next-generation lithium batteries in electric vehicles. Next-generation lithium batteries use polysilicon to store energy, which means longer travel distances between charges for electric vehicles.

“I think you’re going to start seeing it in the next two years,” Sutton said of the next-generation lithium battery’s arrival. “If you look at Sila, they actually bought a space next to us in Washington. Group 14 raised $400 million just a few months ago.

Sila is a lithium battery materials maker in Alameda, Calif., that plans to produce enough materials per year at its 160-acre Moses Lake campus for 100,000 to 500,000 electric vehicles. Group 14 is a Washington battery materials company.

It will take a few years for the battery technology to prove itself in vehicles, Sutton said.

The bill also earmarks $420 million over five years, through the Department of Energy, for university research in 25 EPSCoR states, including Montana. EPSCoR, or Program Established to Boost Competitive Research, funds science in underserved states. Current data from the National Science Foundation for EPSCoR research shows 15 funded projects at Montana universities, including nine at Montana State University in Bozeman, four at the University of Montana in Missoula, and two at Montana Tech in Butte. In 2021, the DOE awarded MSU $3.3 million for next-generation battery research.

EPSCoR funding through the Department of Energy averages about $20 million per year. The CHIPS and Science Act more than doubles that annual amount for two years before increasing it to $75 million, then to $100 million in the final year.

In a press release, Daines said, “Investing in American semiconductor production, innovation, STEM education and R&D is essential to strengthening our national security, strengthening the United States’ position as a world leader and win the race against China”.

Tester, in a press release, noted that the bill provides $800 million for renewable energy development, $1 billion for carbon capture and sequestration research and $1 billion for modernization. of the electrical transmission network.

“This bipartisan legislation is focused on two things: bringing well-paying jobs back to America and maintaining our position as the world’s leading economic power in the face of China’s efforts to dominate the global economy,” Tester said.

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. tech bill billion dollars Senate benefits companies Montana news

. Senates billion tech bill benefits Montana businesses

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