Probably the most exciting result in nuclear fusion in recent history occurred at the US National Ignition Facility (NIF) in December 2022, when, for the first time, experimenters attained more energy (1.5 times more) out of the experiment than was put in. That achievement marks the realisation of ignition in nuclear fusion, the process that generates energy when molecules combine, rather than break apart (known as nuclear fission). It is the best demonstration so far that we might well be able to actually use fusion for power on Earth.

Where will the next big advance come from? It may not be the huge public-sector labs, but from one of the many small nuclear fusion organisations funded by private investors. It’s certainly true that private funding for fusion is growing, and this is a recent phenomenon. Almost two-thirds of the total funding for members of the 38 members of the Fusion Industry Association (FIA), amounting to about $4bn, has come in only the last few years, reports FIA CEO Andrew Holland – and, he adds, most of that was before December 2022, so was not sparked by the NIF news, either.

What could possibly attract a private investor to a such a remote corner of particle physics? It’s not like the field is new. Fusion dates back to the 1950s, but since then fusion results have been notoriously difficult to achieve, primarily because fusion reactions only occur at immense pressures and temperatures where matter becomes plasma: a hot gas, like lightning.

Holland has some theories about why fusion has become a hot ticket for investors. One is the dawning recognition of a market need within the energy industry in the context of the transition to low-carbon fuels. He says: ‘There’s a growing understanding of investors, over the last three to five years, that we’re not going to get all the way there with just the energy of today, just with renewable technologies; you need new technology investment.’ And fusion potentially represents a source of ‘firm’ or always-on power, in contrast to intermittent renewables.

Another is the whiff of opportunity. ‘They see fusion as one of the last great opportunities for really significant return on investment.’ And that’s not doubling their money, but returning it 100 times over. The CEO continues: ‘It’s more high-risk, high-return. Fusion is the biggest of the big game still out there.’

Last, but not least, is the state of the technology itself. In the words of Holland: ‘Fusion is ready’. He adds: ‘There have been really important and significant advances in both the science of plasma physics as well as materials engineering, and the capability to design such that our companies are confident when we build the next thing [prototype reactors, predicted in about a decade] we will be able to show fusion works in a commercially-relevant manner.’

Fusion potentially represents a source of ‘firm’ or always-on power, in contrast to intermittent renewables.

A third way   
Expanding on that last point is Ryan Umstattd, Vice President of Product and Partnerships at private fusion company Zap Energy. He says that the results from massive public-funded research projects such as NIF have helped de-risk the science, but were never intended to create the model for a commercially-viable power plant. 

He says that there have been basically two ways of going after fusion. ‘They were done at two extremes of what plasma physics tells us about how to do fusion. You may have come across the idea that you have to get the fuel hot enough, dense enough for long enough – the triple product – to get fusion. Magnetic fusion does it through a very low density but a long confinement time; inertial confinement does it through a very, very high density but very short energy delivery time.’

‘And in between those two, there is a massive underexplored space of concepts and ideas that the physics says might work. What was really exciting to me was about 10 years ago, people started to publish papers that said that not only is the physics possible in this intermediate density regime, but [also] it looks like it could be a cost minimum. That was mind-blowing for me.’

‘The idea there is confining [plasma] for a really long time, that’s going to be very expensive superconducting magnets. If you are going to deliver energy really, really fast, that’s going to be high-end lasers. In the middle space, you may not need either.’

Even if small private fusion pioneers may not have the maturity of engineering developed over decades in dozens of experiments around the world, they can move quickly, he claims.

Another important way that private nuclear firms are economising is by scaling down. Holland at the FIA says: ‘In fusion especially, if you want to optimise for the lowest science risk, the best thing is to make it as big as possible.’ But commercially speaking, that design choice is, he concludes, a ‘white elephant’; too expensive. Whereas small-scale R&D enables private-sector companies to ‘build faster, iterate better, and reduce their overall costs’.

While Holland cautions that fusion isn’t like software – not cheap or easily-replicable – it has by and large adopted a Silicon Valley investment model, in which projects prioritise the biggest, most existential risks, and as those are solved, they scale up (and spend more). A 2023 supply chain survey found that, in total, its members were spending $500mn per year. When asked to estimate the amount they expect to spend in a year when they start to build pilot plants, the figure increases 14-fold, to $7bn.

Strengthened safety   
Most power sources involve the risk of an explosion. That is a big problem for nuclear fission, the chain reaction exploited to create heat and electricity in civil nuclear reactors, submarine motors and atom bombs. But fusion is different; it can only occur in very specific pressure and temperature ranges (as found in the sun, for example). On Earth, if the electricity feeding the systems that create those conditions in a nuclear reactor were to shut down, so does the reaction.

This has a profound impact on the safety profile of the technology, and that affects the way that it is regulated by governments. The bottom line is that nuclear fusion requires fewer safety systems, and safety oversight, than conventional nuclear power. Explaining the significance is Holland at the FIA: ‘That means we can iterate faster; we don’t have to get approval from the regulator for every design change. That is really important, to move quickly and economically.’

While that aspect strengthens safety, by the same token it jeopardises profitability, if a high fraction of the power generated in the fusion reaction needs to be fed back into the reactor. ‘A decent target for most fusion approaches is to try to keep that recirculating power down.’ Umstattd says that at factors much above 50%, it’s hard to sell enough electricity to recoup the investment in the plant, adding that Zap Energy’s FuZE-Q reactor has a better fraction than others thanks to specific design features.

Public investors   
Even if the NIF results did not improve private-sector fusion funding in 2022, they may well have had another important effect, according to Holland. The results may have legitimised the private fusion industry for public-sector funding, the offer of which does seem to be another new thing. There is the US Department of Energy’s $50mn public-private funding programme, whose awards of funding are milestone-based. He explains what that means, assuming the voice of the US government funders: ‘You take high risks and set yourself bold targets, and if you do it, we’ll reimburse you, but if you don’t, it hasn’t cost us anything.’

But this is happening around the world, according to Holland, who also points to similar private-sector funding approaches in Japan, Germany and the European Union (EU).

UK fusion initiatives   
In the UK, as a decades-old fusion research collaboration with the EU, JET (Joint European Torus), has been winding down, the government launched two investment programmes in 2021 and 2023, with a focus away from big science and toward the private sector. Half of the spending of its £650mn Fusion Futures programme is in the private sector, alongside plans to build a small commercial power fusion plant and investment in the fusion supply chain.

In an October 2023 policy paper, the UK government said: ‘The global landscape of fusion is changing, and the commercialisation of fusion is accelerating… [the] public sector will not deliver fusion alone. Collaboration between public and private sectors will be crucial to tackle the remaining challenges of fusion and accelerate the commercialisation of fusion in a mutually beneficial approach.’

It’s already begun. In 2022, Commonwealth Fusion Systems of the US signed a five-year deal with the UK public-sector nuclear R&D agency. And General Fusion of Canada has contracted the UK Atomic Energy Authority (UKAEA) to validate its fusion data, and is proposing to build a commercial-scale demonstration of its device in the UK.

To be clear, although there are some private sector fusion developments in the UK, and although there are three UK members in the FIA, most of the rest of the activity (and funding) is based in the US.

But a shared nationality doesn’t tell the whole story of these fusion pioneers, according to Holland. ‘It’s tempting to say everyone is on the same racetrack and heading for the same gates, but all of them are on different racetracks and there are different pathways. The ideas of each company are defined to investors, and what the milestones are.’

When pressed on the competitive nature of the industry, Holland states that ‘certainly’ it is a race. ‘I’m not going to say that the winner necessarily gets the entire market... but companies are racing each other, and racing against the climate and the energy crisis, and are in a race to get on to the grid in a way that is time-relevant. And the interest from governments indicates that it’s becoming a geopolitical race as well. The country that hosts the first fusion industry is going to have an advantage.’ 

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