Rocket Lab solar cells. Photo: Rocket Lab

The Biden administration on Tuesday said it has reached a preliminary agreement with Rocket Lab to provide $23.9 million in federal investment to increase production of the company’s solar cells that power spacecraft and satellites.

The preliminary memorandum of terms is non-binding and a final agreement will depend on the results of further due diligence and negotiations, the Department of Commerce said. The investment would boost the company’s production of compound semiconductors by 50% within the next three years to meet growing domestic demand.

Rocket Lab, via its 2022 acquisition of SolAero Technologies, is one of two domestic manufacturers of radiation resistant compound semiconductors. The space-grade solar cells are used in missile tracking satellites, commercial satellites, and scientific spacecraft such as the James Webb Space Telescope and NASA’s Artemis lunar explorations.

Solar cells are important for keeping our communication and space technology powered and operational, and this proposed award would help our military, NASA, and our commercial space industry have access to the specialty semiconductors they need to keep our country safe and continue to lead in scientific discoveries and space commerce,” Commerce Secretary Gina Raimondo said in a statement.

The federal investment is through the CHIPS Act, which is aimed at strengthening the U.S. supply chain and manufacturing base for computer chips.

In addition to the CHIPS Act incentives, New Mexico will provide financial help and incentives worth $25.5 million. SolAero is based in Albuquerque, New Mexico. The expanded production capacity is expected to result in more than 100 new manufacturing jobs being created.

Rocket Lab bills itself as an end-to-end space company. The company also develops and manufactures satellites and related hardware and software, launch vehicles, and provides launch services.

This story was first published by Defense Daily