In just the past year, institutions in Colorado won $290 million in federal funding to support deep tech industries, including semiconductors, quantum and climate resilience. Colorado’s strength at leveraging and winning federal funding opportunities will lead to higher paying jobs at numerous skill levels and bolstering our economy in key advanced industries. Each of the three mentioned industries addresses an urgent technological need and Colorado’s ecosystem—from its infrastructure to its workforce—displays the necessary commitment to finding solutions for these demands.
Boosting Semiconductor Production in the U.S.
The CHIPS and Science Act, which authorized and appropriated funding to boost domestic research and manufacturing of semiconductors nationwide, spurred investment in Colorado’s tech infrastructure. An essential component of electronic devices and sometimes called the “brains of modern electronics”, semiconductors enable advances in computing, communications, clean energy and more. In fact, most of the technologies and systems on which society relies every day are enabled by semiconductors. While currently largely sourced overseas, encouraging the development of the design, manufacturing, testing and packaging of semiconductors in states like Colorado decreases the reliance on imports and creates new local opportunities.
Within Colorado, the semiconductor industry is poised for growth. The Semiconductor Industry Association places Colorado in the top 10 states with the resources and business ecosystem to support a strong semiconductor industry.
OEDIT is spearheading Colorado’s ability to leverage these federal funds. The state’s CHIPS Refundable Tax Credits Program, established by HB23-1260, supports Colorado companies in securing federal funding through the CHIPS Act. The program modifies existing state economic development tools to make them more accessible to the semiconductor industry and advanced manufacturing sector. Each year for five years, $15 million in refundable tax credits will be available for semiconductor and advanced manufacturing companies, reviewed and approved by the Colorado Economic Development Commission (EDC). This state support in turn unlocks CHIPS Act funding, which requires state or local incentives as a prerequisite.
Municipalities, counties or regions of Colorado that are not already located in an Enterprise Zone may opt to establish a state-designated CHIPS Zone which enables qualified semiconductor companies to access incentives that support increased investment and growth. EDC approved semiconductor companies can access five Enterprise Zone state income tax credits, including: investment tax credit, job training tax credit, commercial vehicle tax credit, business facility new employee tax credit and a research and development tax credit.
In addition, the Colorado CHIPS Community Support grant program works to ensure that more communities across the state can benefit from federal funding by supporting Colorado communities interested in growing their local or regional semiconductor industries. Special emphasis is placed on rural applications with limited advanced industries and population centers with emerging industries.
Through this support, Colorado is thrilled to be among a small cohort of states where CHIPS-spurred developments are taking off. Microchip and Entegris, pursuing expansion projects with capital investments reaching $900 million and $725 million, respectively, have each been awarded funding from the CHIPS Program Office totaling over $160 million. The CHIPS Metrology R&D program—a distinct part of the CHIPS Act that will pursue pre-competitive research in measurement science to enable further innovation in the semiconductor industry—is based at NIST Boulder Labs.
Colorado Recognized as a Leader in Quantum
Quantum enables organizations to harness the laws of quantum mechanics to solve complex problems and will soon provide services and products in a manner that was impossible just a few years ago. Colorado is building a robust quantum ecosystem that recently gained federal support.
In June 2024, Elevate Quantum, a consortium of private and public sector organizations, academic institutions and nonprofits across Colorado and New Mexico announced its receipt of an award of $40.5 million in funding by the Economic Development Administration (EDA) as part of its Phase 2 Tech Hub grant funding. The funding unlocked additional support from signed bipartisan state legislation, which invests an additional $74 million in the quantum industry’s development in Colorado. This includes $44 million in refundable tax credits to help fund a shared quantum research facility and $30 million for a loan loss reserve to create greater access to capital for small and medium Colorado quantum companies.
This reward would not be possible without the support of the TechHubNow! Initiative which helped with the Elevate Quantum application and grant funding. TechHubNow! Is a public-private initiative created by Governor Polis and OEDIT that worked towards strategically positioning Colorado for designation as a Regional Technology and Innovation Hub (Tech Hub) under the CHIPS and Science Act.
This national and local commitment proves that Colorado is a leader in this space and the support will help the state position itself as a global hub for quantum computing. By 2030, we anticipate this industry to create over 10,000 new jobs (many of which will not require an advanced degree) and an additional $2 billion in private capital investments in Colorado.
Quantum sensing and enabling hardware applications are commercial here today, and OEDIT’s impact story on Quantum expands on the exciting developments Colorado has in store.
Tackling Climate-Related Challenges Through Tech
Amid climate-related challenges in the west, the need to develop climate-resilient and sustainable technologies is clear. According to the U.S. National Climate Assessment, extreme weather events cost the U.S. $150 billion in 2023, due to direct impacts such as infrastructure damage, worker injuries and agricultural losses.
Colorado and Wyoming joined together to lead the Colorado-Wyoming Climate Resilience Engine (CO-WY Engine) in a bid to be selected as a U.S. National Science Foundation (NSF) Engine. OEDIT supported Innosphere’s efforts to collaborate with Wyoming to align resources that supported the Engine’s goals, including increased engagement of the business community with the region’s research institutions and Federal Labs; attracting more funding to support the commercialization and monetization of new technologies; and growing diversity within the region’s workforce to include rural communities.
The effort paid off as the CO-WY Engine was selected as an NSF Engines grant recipient. This prestigious award positions the CO-WY Engine to receive up to $160 million over the next 10 years to transform Colorado and the region into a national leader in developing climate-resilient and sustainable technologies. The Engine will focus on developing and commercializing climate-resilient and sustainable technologies to help communities across the region and the country monitor, mitigate and adapt to climate impacts including wildfire management, water resource management, agricultural tech (agtech), mitigating extreme weather and earth sensing.
“In ten years, the CO-WY Engine expects to generate significant economic impact for the region, including 22,000 new climate technology related jobs, $1.5 billion in regional GDP impact, more than $1 billion in private capital formation, the training of more than 2,000 individuals, and the distribution of $80 million in commercialization grants to startups in the climate technology sector,” Mike Freeman, Innosphere Ventures CEO and CEO of the CO-WY Engine said in a press release.
The ongoing federal-level support that Colorado is receiving to continue developing its robust semiconductor, quantum, and climate tech hubs is a testament to the state’s thriving ecosystem of innovation and entrepreneurial culture as well as its commitment to address national technological needs of the future. And Coloradans will be at the forefront benefitting from the workforce development, job creation and economic growth that these investments will produce.