Fusion Power’s Potential Electrifies Investors

A new green-energy technology with the power to transform the world is gaining momentum and the financial backing of venture capitalists.

After decades of theoretical research, scientists and engineers at the Lawrence Livermore National Labs achieved “ignition” in 2022, creating a fusion reaction that generated more energy than was consumed. This short-lived reaction proved the theory, but the technology still seemed in its infancy and commercial applications decades away.

However, growing energy demand over the past three years has pushed development within the private sector, and fusion now appears to be on the cusp of becoming commercially viable, catching the eye of investors and major energy consumers. Pitchbook has identified over 100 companies actively developing fusion-energy technology, and so far this year, at least 24 companies combined have raised over $3 billion in funding. As important as these funding rounds are, commercial development agreements are also being signed, supporting the long-term funding of these companies. Here are just a few of the announcements:

• Helion, a leading fusion company based in Everett, Wash., has signed a power purchase agreement with Microsoft to deliver 50 megawatts (MW). The agreement anticipates Helion’s facility going online by 2028 and delivering power as soon as 2029.
• Type One Energy, a Knoxville, Tenn., company, launched a partnership with the Tennessee Valley Authority and the U.S. Department of Energy’s Oak Ridge National Laboratories to jointly deploy Type One Energy’s Infinity prototype and develop a commercial facility.
• Commonwealth Fusion Systems (CFS) is developing a grid-scale commercial fusion power plant in a collaboration with Dominion Energy in Virginia. CFS is hoping to have a small-scale test system completed by 2027, with plans for the grid-scale facility to deliver up to 400 MW of power by the early 2030s. CFS reportedly received a recent cash infusion of $1 billion, purportedly to help fund this project.

Many other companies are working on their own novel approaches to commercialize fusion energy. With artificial intelligence and data centers accelerating energy demands, fusion technology has the potential to address some of these needs within 10 years.