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Polar Semiconductor (Minnesota)

Bloomington, MN 55425
Congressional District
3rd District

Key Facts

web banner image for CHIPS for America and Polar Semiconductor $123 million in direct funding award for "Expansion and modernization of Polar's existing facility to double U.S. production capacity" in Bloomington, Minnesota.

Project Summary

The U.S. Department of Commerce awarded Polar Semiconductor (Polar) up to $123 million in total direct funding under the CHIPS and Science Act to expand and modernize the company’s manufacturing facility in Bloomington, Minnesota, which is expected to almost double its U.S. production capacity of sensor and power chips within two years. The CHIPS incentive award catalyzes an investment of more than $525 million from private, state, and federal sources to transform Polar from a majority foreign-owned in-house manufacturer to a majority U.S.-owned commercial foundry, expanding opportunities for U.S. chip designers to innovate and produce technologies domestically. Through Polar’s semiconductor manufacturing operations, the investment is expected to create over 160 manufacturing and construction jobs in Minnesota.

Economic and National Security Impact

Shortages of power and sensor chips were among the most acute bottlenecks during the COVID-19 pandemic, disrupting critical industries, including automotive, healthcare, aerospace, and defense. Because of the Biden-Harris Administration’s investment in Polar, the U.S. is expected to have an expanded and more stable domestic supply of these essential semiconductor technologies, bolstering U.S. supply chain resilience as a result.

The CHIPS investment is also catalyzing U.S. private capital to transition Polar from a majority foreign-owned, in-house semiconductor manufacturer to a majority U.S.-owned, commercial foundry, enabling the company to expand its U.S. customer base. The collaborative funding approach involving the company, private investors, state and local entities, and federal support would not have been possible without the CHIPS and Science Act. This approach will help protect intellectual property (IP) developed at Polar and encourage innovation among U.S. fabless power semiconductor companies. Moreover, establishing commercial foundry capacity for sensor and power semiconductor technologies in the U.S. will help enable the U.S. defense industrial base to securely manufacture chips used in mission critical programs.

As a result of Biden-Harris Administration’s investment, Polar is expected to almost double its U.S. production capacity of sensor and power semiconductors within two years, from roughly 20,000 to roughly 40,000 wafer starts per month. The investment will also support the addition of advanced technologies for high performing compound semiconductors, cutting-edge sensors, and backend processing that will help the company manufacture the next generation of semiconductors.

Workforce and Community Impact

Through Polar’s semiconductor manufacturing operations, the Biden-Harris Administration’s investment will create over 160 manufacturing and construction jobs in Minnesota. To recruit, train, and retain the workforce needed for these projects, Polar will implement a robust workforce strategy informed by the Biden-Harris Administration’s Good Jobs Principles and will receive up to $3 million in dedicated CHIPS funding to advance workforce development initiatives.

To advance its manufacturing workforce efforts: 

  • Polar Semiconductor, along with other employers and labor organizations, will work with the AFL-CIO Working for America Institute to develop, scale, and adopt the Manufacturing Core Curriculum (MC2), a universal pathway curriculum for advanced manufacturing, including semiconductor manufacturing, to provide workers an onramp to good manufacturing jobs and create a pipeline of job-ready workers for employers across the country.
  • As part of its dedication to developing local talent, Polar commits to provide training and education benefits to its workforce and support programs to expand opportunities for economically disadvantaged individuals, which includes a commitment of nearly $500,000 to fund a tuition-free, hands-on registered apprenticeship program for individuals exploring technician roles within the semiconductor industry, as well as more than $300,000 to fund internal training programs for existing employees that provide opportunities for upskilling and continuing education.
  • As part of this announcement, Polar has committed to expanding access to quality, affordable child care for its facility workers. This includes by engaging with Child Care Aware of Minnesota, the local child care resource and referral provider, to help parents navigate the child care system, including finding culturally affirming high quality providers, and guiding parents to eligible financial aid programs.
  • Polar plays an important role in the Minnesota CHIPS Coalition Workforce Partnership, a coalition of employers, education and training providers, labor organizations and others that seeks to improve workforce development programs to ensure a stronger talent pipeline for immediate and future workforce needs. In addition to Polar, leading members of this coalition include Seagate Technology, the Governors Workforce Development Board (GWDB), and the Greater MSP.

To advance its construction workforce efforts:

  • For the purposes of this project, Polar's construction partner Mortenson is utilizing a Project Labor Agreement (PLA) with the Minnesota Building and Construction Trades to support its construction workforce.
  • Polar has also voluntarily adopted the CHIPS Women in Construction Framework and will work with contractors, trade unions, and other community and workforce partners to implement best practices aimed at expanding the construction workforce by increasing the participation of women and economically disadvantaged individuals.

Polar will make additional broad-based community investments of nearly $500,000 to promote infrastructure, transportation and mobility access, health care, and entry-level relocation expenses. Polar has also committed to undertake efforts to increase its procurement of goods and services from small, minority-owned, veteran-owned, and women-owned businesses.

Environmental and Worker Safety Commitments

In connection with the CHIPS award, the Department is requiring Polar to commit to the following environmental responsibility and worker safety measures in its operations. As is required for all CHIPS projects, Polar’s project will comply with all applicable environmental laws, including the Clean Water Act, Clean Air Act, Endangered Species Protection Act, and the Resource Conservation and Recovery Act.

In connection with the CHIPS award and the NEPA review of the proposed project, Polar is making the following environmental commitments:

  • Greenhouse Gas Emissions Abatement: To abate direct greenhouse gas emissions associated with the facility expansion and modernization, Polar will install point-of-use (POU) abatement systems (such as thermal, catalytic, or plasma systems) on select tools to reduce emissions of high global warming potential perfluorocarbon (PFC) process gases.
  • Renewable Energy Use: Polar will continue to directly purchase electricity through its subscription to Xcel Energy’s Renewable*Connect program to fulfill 100 percent of its fab’s electric power needs using electricity generated from clean and renewable energy sources.
  • PFAS Management: In August 2024, Polar was approved for a Minnesota Pollution Control Agency PFAS source identification grant. Polar plans to conduct targeted PFAS source identification wastewater sampling at various locations within the fabrication area. Based on the sampling results, Polar will develop a plan to design and install a PFAS mitigation system to address fab wastewater discharge.

Polar is also committing to the following worker safety measures:

  • Worker Safety Committee: Polar will continue to operate a workplace safety committee comprised of workers and management that meets regularly and is authorized to address any worker health and safety concerns.
  • Adoption of Most Protective Occupational Exposure Limits: Polar will apply the lowest (i.e., most protective) occupational exposure limit (OEL) among all applicable published health and safety standards (including Occupational Safety and Health Administration, National Institute for Occupational Safety and Health, California OSHA, and American Conference of Governmental Industrial Hygienists standards), for chemicals used in the facility’s operations.
  • Tool Planning and Installation: Polar will adhere to its standard operating procedures (SOPs) for tool acquisition, pre-installation planning, installation, and startup. Polar will require its Safety/Environmental team to authorize all capital purchases for tool acquisition, including reviewing any new hazardous material Safety Data Sheets and safety measures. Polar’s pre-installation planning and installation procedures would ensure compliance with facility specifications (including fire code) and verification of safety equipment and utilities (through hazardous gas, bulk liquid, and waste collection system testing). Polar will also ensure equipment startup includes hazard labeling, emergency shutdown and gas distribution system testing and the review/sign off by a Health & Safety Engineer.
  • Safe Equipment Decontamination: Semiconductor manufacturing equipment decontamination and removal will be executed in accordance with Polar’s SOPs for end-of-life tool decontamination and decommissioning. Tool decommissioning would follow design principles aimed at minimizing environmental effects, such as verifying the decontamination steps (pH testing, wipe sampling, removal of chemical residues, purging gas lines, and removing chemical labels) and labeling for future handlers.

Polar will report regularly to the Department on its implementation of these environmental and worker safety commitments.

Financial and Commercial Terms

As stated in the CHIPS Notice of Funding Opportunity (NOFO) for Commercial Fabrication Facilities, CHIPS for America will distribute direct funding based on the completion of project components in connection with both the capital expenditures for the project and construction, production, and commercial milestones. The program will track the performance of each CHIPS Incentives Award through financial and programmatic reports, in accordance with the award terms and conditions, to establish a compliance program to monitor that commitments are being upheld. All CHIPS funding recipients are required to adhere to restrictions pursuant to the CHIPS and Science Act and NOFO regarding stock buybacks, National Security Guardrails, and access to intellectual property. Although Polar is below the $150 million threshold for the upside sharing requirement, the company has committed to an upside sharing agreement under this award. The Department and Polar have also agreed that the company will not engage in any stock buybacks for a period of 5 years.

Other

Polar has committed to use commercially reasonable efforts to allocate 7% of its total U.S.-based revenue each year to R&D that is conducted in the United States for a period of 5 years and will support R&D and other technology advancement efforts through the National Semiconductor Technology Center (NSTC) and the Department of Defense’s Microelectronic Commons program.

Project Statistics: Polar Semiconductor

Project Summary

RecipientPolar Semiconductor
Location(s)Bloomington, Minnesota
Congressional District 3rd Congressional District
Estimated Job Creation98 manufacturing jobs and 68 construction jobs

Financial Summary

ProgramCHIPS Program Office
Direct Funding AmountUp to $123 million
Total Project Cost$525 million

Facility Summary

Project TypeExpansion and modernization of Polar’s existing mature-node facility
Project TimelineExpected to almost double U.S. production capacity within 2 years

Progress Photos

interior photo of construction progress for future Polar fabrication facility
Credit: Polar Semiconductor



 

interior photo of construction progress by workers on the future Polar fabrication facility
Credit: Polar Semiconductor



 

interior photo of construction progress in equipment from the future Polar fabrication facility
Credit: Polar Semiconductor
interior photo of construction progress for future Polar fabrication facility
Credit: Polar Semiconductor



 

interior photo of construction progress by workers on the future Polar fabrication facility
Credit: Polar Semiconductor



 

interior photo of construction progress in equipment from the future Polar fabrication facility
Credit: Polar Semiconductor
Award Amount
$123 million in direct funding
Application Stage
Final Award
CHIPS Organization
CHIPS Program Office