How the next generation of semiconductor factories kicked up a fight over environmental review

Lawmakers’ push to revive chip manufacturing in the United States has raised new concerns about pollution regulation, inadvertently subjecting semiconductor factories to federal environmental review for the first time. But while a bipartisan bill would exempt factories to support a still-struggling American industry, some environmental advocates fear it could weaken the country’s key environmental law.

Since the 1990s, semiconductor manufacturing has moved from the United States to Asia. Around that time, it was becoming cheaper to build factories and hire workers in Asia. Hazard studies chemicals in factories and trials Problems of worker exposure to them were also emerging in the United States.

Now, the global chip shortage — and the desire to counter China’s manufacturing dominance while generating more U.S. jobs — could spur a new generation of factories. After a push by lawmakers to rebuild a domestic semiconductor industry, Joe Biden signed the bipartisan CHIPS and Science Act into law last year, allocating $52 billion in funding for domestic semiconductor manufacturing.

Financing could have a downside for some companies. By accepting the money, its new factories could be considered “significant” projects subject to federal review under the National Environmental Policy Act (NEPA) of 1970. The law requires federal agencies to evaluate the potential environmental impact of an important new project.

In the past, semiconductor factories typically would have had to follow a patchwork of state and local laws. Some states have adopted NEPA-like mandates. The EPA also regulates industrial pollution. But what makes NEPA a unique and powerful statute is that it is a sunny law that requires the participation of local communities. Unless a major project qualifies for a categorical exclusion, federal agencies must complete an environmental assessment. If the project is determined to have a significant impact, then it must undergo further evaluation that includes public review.

Public participation, in particular, has made NEPA a cornerstone of environmental protection in the United States and one of the key tools residents have to oppose projects that could affect them. “(NEPA) often provides the only opportunity for public input on these types of decisions when taxpayer dollars are at stake and when community health is at stake,” says Stephen Schima, senior legislative counsel for the organization. of environmental law Earthjustice.

Dozens of toxic Superfund sites are an ugly legacy of America’s last semiconductor boom. From the 1950s to the 1970s, the U.S. dominated Global semiconductor manufacturing. Their factories, or fabs, gave his name to Silicon Valley. That’s not the only way the fabs made their mark. Santa Clara County, home to Silicon Valley, now has more than 23 superfund sites: Sites so contaminated that the EPA has placed them on a “National Priorities List” for cleanup. That’s more than any other county in the United States. A common toxin found there is trichlorethylene (TCE), a chemical used for decades to clean semiconductors until the mid-1990s. It is now a known carcinogen.

While factories in the United States have phased out the use of toxic substances that came to light in the 1990s, the same safeguards do not necessarily exist in newer manufacturing centers in Asia. A 2017 Bloomberg investigation found that thousands of semiconductor factory workers in Asia could still have been exposed to chemicals linked to reproductive health risks and miscarriages. Furthermore, modern factories still produce dangerous residues that needs to be handled properly. They also use a lot water and energyand them Emissions of greenhouse gases have come under scrutiny as climate change becomes a greater global threat. Those are issues that could arise as the Biden administration tries to build a domestic supply chain.

The Semiconductor Industry Association declined to speak on the record with The edge. But some supporters of the CHIPS Act argue that environmental reviews under NEPA could simply hamper the process with delays. The environmental review process can take more than four years, on average, to complete. And it turns out that NEPA is the most frequently litigated environmental law in the United States. “The idea is that by exempting them from NEPA review, you’re not allowing private citizens to initiate all of the litigation at every step of the process,” says Alexander Kersten, deputy director and fellow at the Renewable American Innovation Project at the Center for Innovation think tank. Strategic and International Studies (CSIS).

The United States cannot afford these additional steps if it wants to compete with other countries where it has become cheaper to make semiconductors, some proponents of the bill say. “We are in very tough competition with China and with our friends, allies and competitors around the world,” says Charles Wessner, an adjunct professor at Georgetown University and non-resident expert at CSIS. “We have to take care of our country and the people from an environmental point of view, but we also have to be able to act quickly to get these factories up and running. “It is extremely costly for a project as large as a semiconductor facility to be delayed.”

To avoid any problems, Senators Mark Kelly (D-AZ), Todd Young (R-IN), Bill Hagerty (R-TN), and Sherrod Brown (D-OH) inserted the Construction Chip Act in the United States this year. The bill exempts certain CHIPS Act-funded projects from NEPA review, including those that rely on federal funds for a small portion of costs and expansions of existing sites that are less than twice the size of the facility. Projects that have already begun construction after receiving other necessary state and/or federal permits would also be exempt, as would projects that already need to complete a state-level review “at least as stringent as NEPA.” It also gives the Commerce secretary more leeway to direct any necessary federal environmental reviews. The measures were incorporated into the National Defense Authorization Act of 2024, a defense spending bill that Congress must still finalize before the end of the year.

However, environmental advocates maintain that NEPA is neither the only nor the primary cause of project delays. They point to a lack of staffing or limited funding in federal agencies, problems that are outside the scope of NEPA. And many of the new semiconductor factories being built may not even have triggered NEPA review in the first place, so some advocates find it baffling that a bill exempting them from NEPA is necessary. . “It’s like looking for a solution to a problem that doesn’t exist… it’s, you know, scapegoating NEPA,” says Brett Hartl, director of government affairs at the nonprofit Center for Biological Diversity. .

For now, environmental defenders The edge The companies we spoke to are focused on protecting NEPA, not scrutinizing individual chipmakers. NEPA has faced a spate of attacks in recent years. The Trump administration gutted the law in 2020, imposing strict timelines for environmental reviews, allowing federal agencies to ignore climate change in their assessments, and allowing projects not primarily funded by federal funds to skip the process entirely. Biden has from invested course and tried find other ways to accelerate NEPA reviews but faces Donald Trump once again in the middle of the election season.

“There’s been this kind of undue focus on NEPA,” Schima says. “The consequence of this is an erosion of government accountability, transparency and public participation in federal decision-making.”