US lawmakers approved environmental incentives for companies building chip production plants

For companies looking to help revive the US semiconductor industry, support from financial to regulatory is essential. In this context, it can be recognized that some relaxations in US environmental legislation will help them build enterprises faster without having to comply with strict requirements. The lower house of the US Parliament recently approved these relaxations.

Image Source: Intel

Companies that do not comply with environmental regulations when building facilities in the United States may either not receive government approval for their operations or face large fines. As Bloomberg notes, the US House of Representatives recently approved a bill that would exclude projects for the construction of enterprises for the production of chips from the general environmental approval procedure. Last summer, the corresponding bill was approved by the US Senate, but since it caused heated debate in the lower house of parliament, its discussion dragged on. Representatives of the US Republican Party tried to achieve wider application of the exemptions, but in the end the benefits were provided only to companies associated with the production of semiconductor components.

The bill must now be signed by the US President to finally take effect. It is assumed that the relaxations for companies in the semiconductor sector will allow them to quickly build enterprises in the country, without regard to very strict environmental requirements. For a plant construction project to be exempt, it must meet one of three conditions. For example, construction could begin before the end of this year, and only one of the major projects funded by the CHIP Act would not meet this requirement. Micron Technology will not be able to begin construction of a facility in New York State within the specified time frame due to the need to go through all stages of approvals.

The second option for exemption from the “environmental burden” is to use only preferential loans within the framework of the “CHIP Law”, and not apply for non-repayable subsidies from the US authorities. Until now, none of the participants in this program have met this condition. Finally, the third way is to limit the amount of the subsidy to 10% of the total project costs. In last year’s version of the bill, this threshold reached 15%.