(The Center Square) – Another multi-million-dollar company has received millions in taxpayer dollars from a Texas CHIPS Act grant.
Through a bill passed by the Texas legislature and signed into law by Gov. Greg Abbott, the Texas CHIPS Act created the Texas Semiconductor Innovation Consortium and Texas Semiconducter Innovation Fund, among other provisions, to solidify Texas as the U.S. leader in the semiconductor industry.
In June 2023, the TSIF was established, with more than $698 million appropriated to create incentives to encourage semiconductor research, design, and manufacturing in Texas.
By November 2024, the first TSIF grant of $4.12 million was awarded to Intelligent Epitaxy Technology, Inc. (IntelliEPI) to expand operations at its 30,000 square-foot wafer production facility in Allen. IntelliEPI committed $41 million in capital investment to nearly triple its annual wafer production.
IntelliEPI choosing the Dallas-Fort Worth Metroplex as its headquarters was important, it says, because it’s “one of the world’s foremost regions for innovation and the production of electronic components, ever since the invention of the IC at Texas Instruments in 1958.”
IntelliEPI is the only domestic manufacturer of epitaxy-based compound wafers in the U.S. It first incorporated its technology in Texas. The wafers are used in telecommunications, photonics, radio frequency and microwave technologies and other high-performance applications.
The grant will enhance and accelerate construction of a new annex next to IntelliEPI’s existing facility, increase manufacturing capacity and conduct further advanced research and development. Doing so is “critical to accelerate the production of high-performance epitaxy wafers and implement the next-generation semiconductor device manufacturing processes,” IntelliEPI says. “These efforts are expected to have broad implications for industries ranging from aerospace and defense to telecommunications and automotive, all of which rely heavily on state-of-the-art compound semiconductor wafer technologies to drive innovation and maintain competitive advantage.”
“This TSIF award underscores the critical importance of our advanced compound wafer technologies, along with TSIF’s strategic goals for semiconductor innovation,” IntelliEPI CEO Dr. Yung-Chung Kao said. “The funding will not only expand our production facilities but also solidify the State of Texas’ position as a key hub for compound wafer manufacturing, a critical need for America’s national and economic security.”
This week, a $2.4 million TSIF grant was awarded to Dongjin Semichem Texas, Inc. (DST) for its specialty chemicals and materials facility in Killeen. The facility will manufacture ultra-high-purity photoresist thinners, which are critical for the photolithography process in semiconductor chip fabrication. They are used to produce leading-edge chips in high-performance computing, 5G, AI, automotive, aerospace, and defense applications.
The DST facility will replace foreign sources of the thinners producing them in Texas for the first time. DST has committed $110 million in capital investment and its Killeen facility is expected to create 24 new jobs.
“Texas is where the chip was born and where the future of the semiconductor industry is building,” Abbott said. Chip technology manufacturing expansion efforts in Texas “will further secure the U.S. semiconductor supply chain.” Thanks to companies like IntelliEPI and DST, “Texas will continue to be No. 1 for semiconductors as we partner with businesses and entrepreneurs to develop innovative new technologies to build a stronger, more prosperous Texas than ever before,” he said.
The grant and consortium are part of the Texas CHIPS Office, created to leverage Texas’ investments in the semiconductor industry, encourage semiconductor-related companies to expand in Texas, foster expertise at higher education institutions and maintain Texas as the U.S. leader in semiconductor manufacturing.
The Texas CHIPS Act is separate from the federal CHIPS Act, which appropriated nearly $6.5 billion to semiconductor manufacturing in Texas, The Center Square reported.
In response to supply chain failures during the Biden administration, Abbott and major companies prioritized expanding semiconductor manufacturing in Texas.
In 2022, Texas Instruments broke ground on a new semiconductor plant in Sherman, announcing a $30 billion investment to expand its manufacturing capability long term. It was the largest private-sector economic investment in Texas history.
Also in 2022, Taiwan-based GlobalWafers Co. announced it was building a 300-millimeter silicon wafer factory in Sherman to strengthen the domestic semiconductor supply chain.
In 2023, Texas ranked first for having the best business climate and first for semiconductor production, also leading the U.S. as the top exporter of semiconductors and other electronic components for 13 years, The Center Square reported. Texas leads the U.S. in new chip manufacturing; more than 43,000 currently work in the Texas semiconductor industry.