Biden to Sign Bill Easing Environmental Regs for Chip Manufacturing

WASHINGTON, Sept. 25, 2024 – The microchip industry scored a major victory Monday as the House passed a bill loosening environmental regulations for federally funded chip manufacturing projects.

Despite opposition from environmental groups and objections from House Democratic leaders, President Joe Biden plans to sign the Building Chips in America Act, a White House official told POLITICO Tuesday. The official said the legislation “will allow us to continue our efforts to ensure Americans can benefit from the Investing in America agenda.”

The microchip industry for two years had been trying to dilute the environmental-impact rules attached to the Biden administration’s $39 billion CHIPS and Science Act. That law, passed in 2022, was an effort to boost American chip fabrication plants, U.S. job growth, and industrial capacity.

“Recipients of that money are required to complete federal environmental reviews under the decades-old National Environmental Policy Act before they can receive funding — a first for an industry unaccustomed to the extra environmental red tape accompanying federal subsidies,” Politico reported. 

“Soon after the ink was dry on the law, industry lobbyists began pressuring Capitol Hill to exempt some projects from NEPA and shorten the litigation timeline for others” Politico reported. “They warned that without those changes, construction of chip facilities could be delayed for months or years”.

The Senate passed the bill unanimously in December, and on Monday, GOP House leadership quickly pushed it to a suspension vote, securing the two-thirds majority with support from Democrats — many of whom represent states set to host major chip manufacturing facilities.

While the bill’s supporters argue that it will accelerate the construction of chip manufacturing plants and bolster the U.S. semiconductor industry, critics fear it could set a troubling precedent. Environmental groups warn that the relaxation of NEPA requirements would risk weakening safeguards for communities and ecosystems, undermining Biden’s broader climate agenda.