Commerce plans up to $389 million of CHIPS awards for power semiconductors and critical materials

The Commerce Department announced letters of intent with four companies for $389 million of research and development awards^2,3. The funds are aimed at power semiconductors and critical materials¹. The awards are being made under the CHIPS and Science Act⁴.

Commonwealth Fusion Systems signed an $85 million letter of intent with the department¹⁰. The four proposed awards follow 19 semiconductor research and development grants⁶. One account rounded the package to $400M of semiconductor research funding⁸. Another described it as a plan for up to $389M for power semiconductors under the CHIPS Act⁹.

Commerce Secretary Howard Lutnick said the awards will “accelerate American semiconductor innovation to enhance our domestic energy” and power resources^1,2. “These investments expand domestic research, secure critical supply chains, and create high-paying American jobs,” he said³.

Why it matters to investors

The awards steer federal research money toward power semiconductors and critical materials^1,6. Lutnick framed the programme as serving energy policy as well as chip policy, saying it would enhance domestic energy resources^5,7.

The claims about jobs and supply-chain security are the department’s own^3,4. Commonwealth Fusion Systems’ $85 million letter alone accounts for a substantial share of the $389 million total^2,10. Lutnick also presented the package as part of a wider push, saying: “The Trump Administration is accelerating American semiconductor innovation”⁹.

The money is not yet paid out. The department described the four as proposed awards, and it plans up to $389M under them^6,9. The announcement took the form of letters of intent rather than signed awards^2,3.

What to watch

The next step is whether the letters of intent turn into final awards, and on what terms^2,3. Investors in the four companies, including Commonwealth Fusion Systems with its $85 million letter, will look for the conditions attached to the funds¹⁰.

The awards also add to the federal government’s growing list of research grants under the CHIPS and Science Act, after the 19 earlier semiconductor grants^4,6. Their focus on critical materials ties the programme to supply chains that the department says it wants to secure^3,6. Coverage aimed at the mining industry framed the package as a boost for critical materials⁶.