Dive Brief:
- Chipmaker Infinera is set to receive up to $93 million in CHIPS and Science funding from the Commerce Department, the agency announced Thursday morning.
- Infinera plans to use the funds to help build a semiconductor fab in San Jose, California, and an advanced test and packaging facility in Bethlehem, Pennsylvania.
- Both projects are expected to increase Infinera’s domestic production capacity by tenfold and create approximately 500 manufacturing jobs and 1,200 construction jobs.
Dive Insight:
The expansion will support Infinera’s production of photonic integrated circuits, which are essential for various technologies, including artificial intelligence, telecommunications and secure communications for defense agencies, according to the release.
PICs and optical semiconductors, which Infinera will also manufacture, enable fast, reliable data transfer across broadband networks and between AI systems and data centers. Both technologies absorb and emit light to transfer information with greater energy efficiency.
In Pennsylvania, the new facility will include research and development space focused on emerging optical packaging technologies, such as 2.5D and 3D packaging and co-packaged optics. Meanwhile, the California fab will have over 40,000 square feet of cleanroom space to increase manufacturing capacity to meet future demand.
Infinera has signed agreements with labor unions in both California and Pennsylvania for the construction of its new facilities. In California, it partnered with the Nor Cal Carpenters Union and Vulcan Construction, using 100% labor union-signatory contractors. In Pennsylvania, it will work with the Lehigh Valley Building Trades.
To build its workforce, Infinera has partnered with the SEMI Foundation and will offer apprenticeships in California, with plans to expand to Pennsylvania.
Due to the CHIPS Act, Infinera is also working with online caregiver service website Care.com to provide paid subscriptions for U.S. employees. At the California facility, the carpenters union will implement its recently introduced parental leave and childcare assistance program through the ERiCA grant, which supports women, non-binary and underserved groups pursuing construction careers.
Infinera previously committed to using 100% renewable energy by 2030 at all of its U.S. locations. The company uses on-site treatment systems to ensure responsible water discharge and water-saving technologies. Infinera’s San Jose operations are already 95% carbon-free.
The chipmaker has plans to claim the Department of Treasury’s investment tax credit of up to 25%. The DOC will continue its due diligence before finalizing the CHIPS incentives, the release stated.
So far, the CHIPS Act has allocated over $36 billion in proposed funding across 19 states. Just this month, Wolfspeed inked $750 million in CHIPS funding to help build a North Carolina silicon carbide wafer semiconductor plant and expand its New York facility. Edwards Vacuum also received up to $18 million on Oct. 10 to build a $319 million facility in New York for dry vacuum pump production.
