The scenery rapidly shifts as you travel east on Route 40 from Columbus. Grain elevators replace strip malls, the road flattens out, and the fields around the town of New Albany begin to take on a new appearance. Graded and cleared. fenced off with construction signage that mentions project dates expressed in years rather than months and contains firms like Intel. This is Licking County, Ohio, which was primarily recognized as Ohio’s geographic center until recently. It is currently home to what, if the project timeline holds, may grow into one of the biggest semiconductor production complexes in the Western Hemisphere—a topic of much discussion.
Although it may seem like it, the move of semiconductor and technology manufacturing from California to the American Midwest is not a recent development. The CHIPS and Science Act, which was passed in 2022, expedited a process that had already started: businesses were discreetly calculating California’s operational expenses and coming to the conclusion that the calculations were no longer accurate.
High corporate taxes, costly real estate, faster-than-average energy costs, and a regulatory framework that required years to enable huge industrial operations were all contributing factors. Ohio, on the other hand, provided land at a significantly lower cost, a power grid with significant unutilized capacity, and state and local governments prepared to set up tax incentive packages significant enough to spark internal board discussions.
The focal point of this migration was Intel’s Ohio commitment, which was made public with great fanfare in early 2022. The $20 billion first investment, which could eventually grow to $100 billion, would initially include two factories with the possibility of eight. The project received a lot of attention, which is likely due in part to the fact that the numbers are huge enough to make comprehension somewhat difficult. The picture that emerged was more nuanced. Timelines for construction changed. Phases of the Ohio buildout were postponed while Intel restructured operations due to severe financial pressure from around the world. For a while, the mega-fab story served as a warning regarding the discrepancy between announcement and implementation in large-scale infrastructure projects.
However, the essential reasoning shouldn’t be obscured by that difficulty. Intel’s timeframe slipped, but that didn’t change the reasons for building in Ohio instead of California. The Midwest continues to have more advantageous land availability, energy capacity, access to federal subsidies, and cost structure than the coasts. For similar reasons, Taiwan Semiconductor Manufacturing Company has started constructing in Arizona. In Texas, Samsung has been growing. The geographic dispersion of American semiconductor manufacturing is not limited to a single, well-known Ohio initiative, but rather occurs throughout several states and numerous businesses. No single fab can match the size of the design.
In real time, local communities are discovering the true implications of hosting this type of infrastructure. Large semiconductor fabrication facilities use a lot of water because they need a lot of ultrapure water for chip washing procedures. A single major fabrication plant can have grid demand comparable to that of a whole county of residential users. Local electricity providers and municipal water systems in Licking County and the neighboring areas have been instructed to prepare for demand levels that they were not designed to handle. Residents whose wells and infrastructure weren’t built with industrial-scale neighbors in mind have expressed genuine anxiety with genuine economic joy for construction projects and long-term employment.
