The Trump administration is considering reallocating at least $2 billion from the CHIPS and Science Act to support critical minerals projects, according to a Reuters report citing two sources familiar with the matter.
The proposed plan would divert funds originally designated for semiconductor research and factory construction toward bolstering domestic supplies of minerals such as gallium, germanium, and lithium, materials essential to electronics, defense systems, and clean energy technologies.
The shift would also expand Commerce Secretary Howard Lutnick’s role in overseeing financing for the sector, the sources told Reuters.
The move comes as Washington looks to reduce reliance on China, which controls much of the global processing of critical minerals.
"The administration is creatively trying to find ways to fund the critical minerals sector," one of the sources said, adding that discussions are ongoing and subject to change.
The CHIPS Act, signed into law in 2022 under President Joe Biden, authorized $52.7 billion to boost domestic semiconductor research and production.
Since taking office in January, Trump has criticized the program and sought to renegotiate grants to chipmakers.
Repurposing some of the CHIPS Act funding for mining aligns partly with its original intent, given the semiconductor industry’s reliance on secure mineral supplies.
However, the Biden administration previously examined a similar reallocation and rejected it as uneconomical and environmentally complex, a former US official told Reuters.
It is not yet clear whether the Trump administration would structure support as grants or equity stakes, but Lutnick is pushing to “get the $2 billion out the door” quickly, Reuters reported.
Additional reallocations could follow as officials seek more funding sources.