The U.S. administration is weighing a plan to reallocate at least $2 billion from the CHIPS and Science Act to support critical minerals projects, according to sources familiar with the discussions. The move would also expand the role of Commerce Secretary Howard Lutnick in overseeing funding for the sector.
The proposal would divert funds originally designated for semiconductor research and factory construction. Officials say the intent is to reduce reliance on overseas sources for minerals vital to electronics, renewable energy, and defense industries.
Critical minerals such as gallium and germanium are essential for chipmaking and other advanced technologies. Currently, most processing and refining of these minerals occur outside the United States, prompting calls for more domestic capacity.
Industry stakeholders, including mining, processing, and recycling companies, could benefit if funds are repurposed. Some executives have stressed that government support is crucial for new projects, citing high costs and regulatory hurdles.
The CHIPS Act, passed in 2022, allocated $52.7 billion to strengthen U.S. semiconductor production and research. Since taking office in January, the administration has been reviewing the program, including renegotiating grants to chipmakers.
Officials are considering whether the $2 billion would be distributed as grants or equity stakes in companies. The timeline for implementation remains under discussion, with sources noting the administration is seeking ways to accelerate the funding process.
The plan reflects a broader effort to coordinate funding decisions across agencies. Lutnick is expected to play a leading role in aligning government support for critical minerals with the country’s long-term industrial strategy.
While the final decision has not yet been made, the debate highlights the administration’s efforts to balance semiconductor development with securing the supply of raw materials needed for advanced manufacturing.
#ITCNewsUpdates #BreakingNews #USNews #CriticalMinerals #CHIPSAct #TradePolicy #ITCNewsUpdates