Intel Expansion Will Create Major Energy Demand

Sam Beebe, Ecotrust, CC BY 2.0 via Wikimedia Commons

PBJ: Chip maker will spend $36B modernizing Hillsboro facilities

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A massive renovation of Intel’s Hillsboro facility is expected to put the region’s power grid to the test, though it’s early to say by how much.

The Portland Business Journal recently looked at the region’s ballooning electric load and how experts propose to ease the flow.

In March, Intel announced it will spend $36 billion to expand and modernize its Ronler Acres facilities in Washington County, where around 23,000 people work.

PBJ quotes energy consultant Randy Hardy, who said regional utility Portland General Electric already has enormous trouble serving demand in the Hillsboro area. (Hardy ran the Bonneville Power Administration for six years in the 1990s.)

PGE has struggled for years to meet growing energy demands while attempting to cut greenhouse emissions. Complicating matters is a recent spate of data center projects on the west side of the metro area that caused the utility in 2023 to increase electric load projections by 44% each year through 2028.

It’s unknown how much Intel’s looming expansion, and other semiconductor investments, will tax the region’s utilities. But PGE and BPA are devising a multi-pronged approach involving upgrades and new lines and substations.

The federal government will contribute $8.5 billion to Intel’s Hillsboro expansion, with an additional $11 billion available in loan support. The money comes from the 2022 CHIPS and Science Act, an effort by President Joe Biden’s administration to revitalize domestic semiconductor manufacturing. The act allotted $280 billion to strengthen the U.S. supply chain and reduce reliance on foreign manufacturers.

In 1990, the U.S. produced 40% of the world’s semiconductors. That figure has fallen to around 12%.

So far, the CHIPS act has generated a flurry of economic investment. Companies requested $70 billion in subsidies through the act — more than twice the amount available. With such fierce competition for funding, federal officials are giving priority to projects that will be completed by 2030, according to reporting by the New York Times.

Critics of CHIPS say it’s overly costly and oversteps the traditional role of government by picking business winners and losers.

The Hillsboro project is part of $100 billion in capital expenditures Intel has planned for the next five years. Projects in Ohio and Arizona are expected to cost $28 billion and $32 billion, respectively. Another in New Mexico is estimated to cost $3.5 billion.

In total, the state expects $40 billion in business investment in the semiconductor industry in Oregon. All that’s expected to bring around 6,300 jobs and 1,000 construction jobs to the state.

New chip manufacturing facilities aren’t cheap, costing around $5 billion to $20 billion, or more than a nuclear power plant.

In 2022, Intel completed a $3 billion, 1.5-million square foot expansion of its D1X development factory in Hillsboro.

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