Biden Exempts Some Chip Factories From Extra Environmental Scrutiny

President Joe Biden has signed a new law so that semiconductor factories in the US receiving funding as part of the US CHIPS Act, will not be subject to additional federal environmental reviews.

The White House on Wednesday announced that President Biden signed into law the bill “S. 2228, the ‘Building Chips in America Act of 2023,’ which exempts certain projects relating to the production of semiconductors from environmental reviews under the National Environmental Policy Act of 1969.”

It comes after the Biden Administration in August 2022 had signed into law the $52.7 billion US Chips and Science Act, which seeks to encourage chip makers to build more semiconductor manufacturing capacity in the United States.

Environmental reviews

Indeed, the US Chips Act is expected to help the US to more than triple its domestic chip manufacturing capacity and to control nearly 30 percent of advanced chipmaking by 2032, while China is estimated to manufacture only 2 percent of the most advanced chips.

But in addition to this, the bill S. 2228 will exempt some US semiconductor manufacturing facilities from federal environmental reviews that are receiving those government subsidies.

Without this new law, those chip factories receiving funding could have been forced to undergo additional federal environmental reviews in order to win federal permits.

Supporters of this new law point out those factories had already complied with federal, state and local environmental regulations and permitting requirements, and that without the change, they could have potentially faced years of additional delays.

But the new law exempting these factories from federal environmental reviews has not pleased environmentalists.

Reuters cited environmental groups such as the Sierra Club as saying the reviews are essential to “keep communities and workers safe from the hazardous contaminants used in the semiconductor industry.”

Funding allocations

So far, the US Commerce Department has allocated more than $35 billion for 26 projects from the $52.7 billion US Chips and Science Act.

Winners of the grants include $6.4 billion so Samsung can expand chip production in Texas; $8.5 billion for Intel; $6.6 billion for TSMC to ramp up its American production; $6.1 billion for Micron Technology to fund US chip factories; and $1.6 billion so Texas Instruments can build three new chip manufacturing plants in the US.

The White House reportedly said it will “continue to uphold our commitment to ensuring that semiconductor projects are built and operated in a way that meets clean water, clean air, endangered species, and other federal requirements and minimises risks and impacts to workers, public health, and the environment.”

The Semiconductor Industry Association had warned that without the law the reviews could have slowed or stopped projects already under construction.