This month, the US Nuclear Regulatory Commission (NRC) announced a change in policy that could shape the world’s energy future. From now on, nuclear fusion in the US will no longer be regulated the same as nuclear fission, the process behind all of today’s nuclear reactors. Instead, fusion reactors will be regulated under the same regime as particle accelerators. The change “will give fusion developers the regulatory certainty they need to innovate while they grow fusion energy into a viable new energy source”, said the US-based Fusion Industry Association in a statement. More investment in the US will likely mean more investment worldwide.

That regulatory change follows a breakthrough experiment in December 2022 that for the first time created a fusion reaction that produced more energy than the energy injected into it. The experiment at Lawrence Livermore National Laboratory’s National Ignition Facility (NIF) in California was conducted by the US Department of Energy and the National Nuclear Security Administration. US Energy Secretary Jennifer Granholm called it “a landmark achievement” that will “undoubtedly spark even more discovery”.

Such recent breakthroughs are spurring more investment into fusion, and moving up timelines. Massachusetts-based Commonwealth Fusion Systems now says it expects its SPARC demonstration fusion machine, which started construction two years ago, to be operational in 2025. “We will look to be demonstrating that net gain of more power out than in soon thereafter, and that puts us on a path of looking at putting a commercial fusion power plant into the grid in the early 2030s,” said Jennifer Ganten, chief movement builder at Commonwealth Fusion Systems, at a recent fusion event in Brussels hosted by the media network Euractiv.

Although it is a process not generally known to the public, fusion is something on which our very survival depends – because it is what powers the sun. In fusion, two light atomic nuclei such as hydrogen combine to form a single, more massive nucleus, releasing a significant amount of energy in the process. Scientists have been working for decades to harness it for energy production on Earth. However, achieving this requires high temperatures and pressures to overcome the repulsive forces between the positively charged nuclei, and to bring them close enough together for the strong nuclear force to bind them together. There are two possibilities to make that happen: using doughnut-shaped magnetic confinement devices called tokamaks to contain a plasma of ionised hydrogen, or deuterium and tritium, in a magnetic field; or using lasers to compress and heat a small pellet of fuel, known as inertial confinement fusion. Both processes are enormously complicated and expensive.

Political interest

Nevertheless, European companies and policymakers are starting to make big investments. “In the Commission we follow a net-zero policy, so each and every energy source which can contribute to that is of course most welcome – and fusion is clearly a candidate in the medium term to fill this role,” Massimo Garribba, the European Commission’s deputy director-general for nuclear policies, said at the Brussels event. The EU has been shepherding a collaborative experiment in southern France since 2006, called ITER, to prove the feasibility of fusion. This is being done in partnership with China, India, Japan, Korea, Russia and the US – although the participation of the latter is now in doubt. The goal is to get it up and running by 2035, with commercialisation potential in the decade after that. “Fusion is carbon-free, it is supposed to be safe and it has the potential to be rather limitless in the way that it can exploited,” said Garribba.

That last point is key, because unlike the current fission nuclear power that runs on uranium and plutonium (still mostly sourced from Russia within Europe), fusion uses hydrogen that is comparatively abundant and can be extracted from seawater. The amount of energy released from fusion reactions is also significantly higher than from nuclear fission. It is also safer – because a chain reaction is almost always prevented by contact with air.

How well do you really know your competitors?

Access the most comprehensive Company Profiles on the market, powered by GlobalData. Save hours of research. Gain competitive edge.

Company Profile – free sample

Thank you!

Your download email will arrive shortly

Not ready to buy yet? Download a free sample

We are confident about the unique quality of our Company Profiles. However, we want you to make the most beneficial decision for your business, so we offer a free sample that you can download by submitting the below form

By GlobalData
Visit our Privacy Policy for more information about our services, how we may use, process and share your personal data, including information of your rights in respect of your personal data and how you can unsubscribe from future marketing communications. Our services are intended for corporate subscribers and you warrant that the email address submitted is your corporate email address.

In the Commission we follow a net-zero policy, so each and every energy source which can contribute to that is of course most welcome – and fusion is clearly a candidate in the medium term to fill this role.”

Massimo Garribba, the European Commission’s deputy director-general for nuclear policies

What does not exist yet is a working demonstration reactor proving fusion’s commercial viability. “That will come post-ITER in the future, and this is where substantial research and development work is going on,” said Garribba. He noted that the EU has a partnership with Japan to develop another system similar to ITER but more focused on the physics of the reaction. Last month, the IFMIF-DONES project was launched in Granada, Spain, in partnership with the government of Croatia, where a machine will test the feasibility of materials that are needed to keep the hot plasma confined.

The recent success of government projects is sparking more business interest. “In terms of the private sector efforts, this is a rather new phenomenon that has been springing up, mainly in the US but also now it is moving to Europe,” said Garribba. “What will be key is to understand what their contribution can be. Potentially, private investment can give a huge push to the research effort, but we have to be very careful about overpromising and under-delivering.” He noted that the private sector timetables are “much more aggressive” than they are for government projects like ITER. “They are talking about commercial deployment in 2035; that is ten years difference from what we are talking about.”

Nuclear fusion commercialisation

Commonwealth Fusion Systems is one example of this blossoming business interest. It was spun out of the Massachusetts Institute of Technology in 2018, now has about 400 employees and has raised more than $2bn to build its first fusion machine to demonstrate that a reaction can be done in an affordable, commercially relevant device and be scaled over time. “Our machine design was built on proven physics – the tokamak design of ITER,” said Ganten. “We have leveraged that same science, but we are putting in the novel technology of newer material that has been invented more recently and become commercially available – these high temperature superconductors which make high-powered magnets, which means you can make the machines smaller.”

Ganten says it is not just the publicly funded projects proving the science, but also a regulatory structure giving certainty that is needed. “The US and the UK have been leading the way in thinking about [that]. [The UK] has already put out a green paper indicating how it would want to regulate this. It is very different from fission, so it will be regulated by their health and safety offices, as opposed to the nuclear office.”

The success of the NIF experiment, along with the US government’s announcement in September 2022 of a $50m programme to fund fusion research, is likely to spur increased business interest. According to research company Bloomberg New Energy Finance, $1bn was invested into fusion in 2022 – triple the amount in 2020. In addition to Commonwealth Fusion Systems, significant investment has also been attracted by General Fusion, Helion Energy, Marvel Fusion, TAE Technologies, Tokamak Energy and Zap Energy, but since these companies are using different technologies and approaches, a big question is which one is going to be the key to unlocking fusion as a commercially viable solution.

That puts us on a path of looking at putting a commercial fusion power plant into the grid in the early 2030s.

Jennifer Ganten, chief movement builder at Commonwealth Fusion Systems

The EU is a bit further behind on the regulatory aspects, having not yet given fusion its own classification like the US and UK. However, EU-based companies are also showing increasing enthusiasm. For instance, Italian energy company Eni has invested in Commonwealth Fusion Systems and is looking for more opportunities closer to home. “We started working on fusion a few years ago, starting with the collaboration with MIT we have had for a long time,” Francesca Ferrazza, head of magnetic fusion initiatives at Eni, said at the Brussels event. “We are working on a decarbonisation path, so we are taking all the energy mix we can in terms of renewables, biofuels, storage and CCS [carbon capture and storage]. Fusion fits in that mix medium and long term.” Eni has also invested in the Divertor Tokamak Test facility in Italy, which uses the same Tokamak technology as ITER. Is the company daunted by the scale of these projects? “We are used to big difficult projects all around the world,” Ferrazza says.

Garribba disputes the idea that the US and UK have an edge on fusion. “Europe has been consistently leading in fusion research and historically it has done so with strong ties to Japan. What we have seen in the US is a very important experiment…using a technology that is completely different.

“What we are doing in Europe is orders of magnitude bigger [than the NIF experiment], when we look at ITER, insofar as we are going to obtain, once ITER works, amounts of energy which are incomparably higher than what has been obtained in the US,” he added.


However, not everyone is sold on the fusion dream. Critics argue that the massive amounts of money required to investigate this unproven technology would be better spent on proven renewable energy technology that can be deployed right away.

Matt Orsagh, a senior advisor with the consultancy Responsible Alpha, believes the success of the NIF experiment may be leading to overexcitment from investors. “The science behind this is amazing, but the practical applications of this experiment are still decades away,” he cautioned in an op-ed in January. “Before December, fusion as a power source was all theoretical. Now, we know it can be done – but will it ever be practical for us as an energy source? That is still an open question.”

In the UK, the Scottish government opposed the national government’s attempt to open a demonstration fusion plant in Scotland. “We don't have time to waste by pouring billions of pounds of public money into unproven technology,” Green member of the Scottish Parliament Mark Ruskell said in a press release. “Fusion may have a role in the future, but there is a long way to go before we will know if it is safe or viable. We cannot pin our hopes for decarbonising our economy on technology that is still years away… the UK government should instead focus on the major investment we need in renewables.”

We cannot pin our hopes for decarbonising our economy on technology that is still years away.

Green member of the Scottish Parliament Mark Ruskell

The controversy over fusion investment is not just in national capitals. It has also become a heated topic at the UN’s annual climate conferences. Attempts to add it to the agenda have seen pushback from NGOs and Green politicians. German Green member of the European Parliament Rasmus Andresen has consistently opposed such efforts, calling fusion a “false climate solution” and saying “the money we are spending on projects like ITER could be used for other developments”.

“Nuclear fusion is an idea that is as old as the nuclear industry, which somehow always seems to be 50 years away,” observes Mehdi Leman from Greenpeace. “The cost and uncertainty of fusion mean investing in thermonuclear reactors at the expense of other available clean energy options.”

Garribba from the Commission disagrees. He says the EU may follow the US and UK in adopting a more conducive regulatory structure for fusion. “At the moment we are reflecting on whether the time has come to take a holistic look at the whole picture and how we see in Europe a further development.”