Investments in semiconductors, emerging technology and clean energy remain a top priority for President Joe Biden in his proposed fiscal year 2024 federal budget.
The budget, which totals $6.9 trillion of federal spending for the next fiscal year, aims to fund $21 billion of the $54 billion CHIPS and Science Act that passed last year, incentivizing semiconductor chipmaker investments in projects based in the U.S. and funding technology research at organizations like the National Science Foundation (NSF) and National Institute of Standards and Technology (NIST). The budget also invests $16.5 billion in climate science and clean energy innovation across federal agencies.
The federal government has already opened some funding opportunities through the CHIPS and Science Act to help ensure the U.S. once again leads in developing and manufacturing semiconductor chips, an area currently dominated by countries like China, Taiwan and South Korea, Biden said in his budget. Chipmakers, including Intel and Taiwan Semiconductor Manufacturing Co. (TSMC), have already pledged billions in new U.S. manufacturing investments and are breaking ground on new facilities based in the U.S., in part due to the CHIPS and Science Act, Biden noted in the budget.
The initial CHIPS and Science Act funding was supposed to be released in the last fiscal year, but has been slow-moving, said Glenn O'Donnell, a research director at Forrester Research. Instead, the money expected this year will arrive in the 2024 fiscal year, and from there, it's supposed to be released in increments of $5 billion in each of the following years. The new fiscal year begins Oct. 1.
Federal budget invests in research, tech innovation
While the CHIPS and Science Act portion of the budget seeks to incentivize chipmakers to build and manufacture semiconductors in the U.S., it also supports organizations like NSF conducting fundamental technology research, O'Donnell said.
"That's a key pillar of the CHIPS Act; it's not just giving handouts to chipmakers," he said.
Indeed, Biden's proposed federal budget marks a "historic increase" for NSF should it make it through Congress, said Margaret Martonosi, NSF's assistant director of the Computer and Information Science and Engineering (CISE) directorate. Biden's 2024 budget requests a $1.8 billion increase for NSF from the last fiscal year budget to support the CHIPS and Science Act.
Glenn O'DonnellResearch director, Forrester
According to the budget, NSF "plays a key role" in the CHIPS and Science Act, focusing on U.S. leadership in semiconductors and other advanced technologies, including artificial intelligence, biotechnology, computing and clean energy.
As part of the initiatives authorized in the CHIPS and Science Act, NSF launched in 2022 the Directorate for Technology, Innovation and Partnerships (TIP) and projects such as the NSF Regional Innovation Engines Program. In Biden's proposed federal budget, the program would receive an additional $300 million "to galvanize use-inspired research, technology translation and workforce development."
The program calls for tech innovation proposals from a wide range of entities, including academia, nonprofits, small businesses and state and local governments, said Erwin Gianchandani, assistant director of the TIP Directorate.
"The Engines program specifically calls for trying to be able to grow innovation ecosystems, particularly in parts of the county that maybe haven't benefited as much from the technology and innovation booms of the last several decades," he said.
NSF is also set to receive $1.6 billion for clean energy innovation, part of the overall $16.5 billion for climate science and clean energy research set aside in the proposed budget.
"We're really excited about climate and clean energy; it's important, it's one of those societal impact areas," Martonosi said. "As with much of what we do, it is across all the directorates, including computing, geosciences, biology, and so forth."
The budget faces Congressional approval and while there is bipartisan support for CHIPS and Science Act funding, Forrester's O'Donnell said it will likely face resistance on Biden's clean energy investments.
"From an American competitiveness perspective, pretty much everybody in Washington agrees we don't want to lose our lead in technology, especially things like semiconductors," O'Donnell said. "There will be pushback on clean energy; it is politically charged and does not have bipartisan support."
Makenzie Holland is a news writer covering big tech and federal regulation. Prior to joining TechTarget, she was a general reporter for the Wilmington StarNews and a crime and education reporter at the Wabash Plain Dealer.