Four planned research awards
The U.S. Commerce Department plans to award up to $389 million to four companies developing power semiconductors and critical materials for fusion energy, artificial-intelligence data centers and chip manufacturing. The awards are set out in letters of intent, meaning final funding remains subject to negotiations and program requirements.
As a condition of the support, the federal government would receive minority, non-controlling and non-voting equity stakes in the recipients. Commerce has used similar terms in recent semiconductor research awards, seeking a potential public return without taking operating control. The money would come from a $10 billion research fund authorized by Congress in 2022.
Fusion power and high-voltage electronics
Washington-based Helion is expected to receive up to $175 million for high-voltage power semiconductors and advanced modules used with the magnets in fusion generators. The company said the award would accompany $50 million in new private investment. Massachusetts-based Commonwealth Fusion Systems is slated for up to $85 million to develop semiconductors for radio-frequency plasma heating, power electronics, diagnostics, radiation-hardened systems and robotic maintenance.
Those projects illustrate why power chips are important beyond phones and computers. They control and convert electricity inside industrial equipment, vehicles, grids and energy systems. Improvements in voltage, efficiency, heat management and durability can determine whether experimental technologies work reliably at commercial scale.
AI data centers and semiconductor materials
Vertical Semiconductor, a startup spun out of the Massachusetts Institute of Technology, is expected to receive up to $73 million for vertical gallium nitride power devices. The company is targeting AI server racks and energy infrastructure, where higher power density can reduce losses and space requirements. Gallium nitride is one of several alternatives to conventional silicon in demanding power applications.
Sibelco North America is in line for up to $56 million to improve purification of ultra-high-purity quartz, a critical input for semiconductor manufacturing. The work would include next-generation leaching methods and a North Carolina demonstration facility for testing new products. Although less visible than chip design, the purity and reliability of materials can constrain production throughout the supply chain.
The four allocations add to the announced total precisely: $175 million for Helion, $85 million for Commonwealth Fusion Systems, $73 million for Vertical Semiconductor and $56 million for Sibelco North America. Because each figure is an upper limit, actual federal spending can be lower if milestones, cost-sharing requirements or final negotiations change. The private-investment commitments are also part of the risk-sharing structure.
From research award to commercial capacity
Equity terms distinguish these awards from ordinary grants. A non-voting, non-controlling stake does not give the government management authority, but it may preserve some financial participation if a recipient’s value rises. Final agreements will need to define how stakes are valued, held and eventually sold while protecting confidential business information and maintaining consistent treatment across recipients.
Commerce has announced 19 semiconductor research grants in recent months. The latest projects extend industrial policy into enabling technologies that could support energy generation and the rapid buildout of data centers. They also spread funding across very different stages, from materials processing to devices intended for systems that are not yet commercially mature.
The awards should therefore be evaluated over years, not quarters. Useful benchmarks include technical milestones, private capital attracted, domestic production capacity and whether prototypes reach paying customers. Federal equity could provide upside if recipients succeed, but it also adds questions about valuation and oversight. The letters of intent establish a direction; final agreements and measurable results will determine the public value.
Source: Reuters reporting on the Commerce Department awards. Reporting reviewed October 22, 2026.