How fusion power works and the startups pursuing it

For many years, the quest to harness stellar energy for electricity generation on Earth has captured human imagination. This dream, long thought to be just a decade away from realization, is now closer than ever, driven by a wave of innovative startups eager to develop functional fusion reactors. These emerging companies have collectively secured over $10 billion in investments, with more than a dozen raising in excess of $100 million. The past year has seen a flurry of significant funding activities, fueled by increasing energy demands, particularly from data centers, and the palpable progress being made in the fusion sector. At its heart, fusion power aims to generate electricity by harnessing the energy released when atomic nuclei fuse together. Despite decades of knowledge about nuclear fusion, including its application in hydrogen bombs, achieving controlled fusion in a manner that can produce surplus energy suitable for power generation remains elusive. However, some experimental devices have achieved notable milestones, including generating more energy than needed to initiate the fusion reaction, yet none have reached the scale necessary for commercial power production. To tackle this challenge, fusion startups are exploring various methodologies. While experts hold diverse opinions on which approaches may succeed, the industry remains in its early stages, leaving many possibilities open. One prevalent technique is magnetic confinement, where powerful magnetic fields are employed to contain plasma, the ionized gas essential for fusion. Commonwealth Fusion Systems (CFS) is at the forefront of this approach, developing magnets capable of producing magnetic fields of 20 tesla—about 13 times stronger than a typical MRI machine. These magnets, made from high-temperature superconductors, require cooling to extreme temperatures. CFS is working on a demonstration project named Sparc, with plans to activate it by late 2026, potentially followed by construction of a commercial power plant named Arc in Virginia around 2027 or 2028. Two primary designs fall under magnetic confinement: tokamaks and stellarators. Tokamaks, theorized by Soviet scientists in the 1950s, have two main configurations: a D-shaped doughnut and a spherical form. Noteworthy tokamaks include the Joint European Torus (JET) and ITER, with JET operational in the UK from 1983 to 2023 and ITER slated to begin operations in France in the late 2030s. UK-based Tokamak Energy is also advancing a spherical tokamak model with its ST40 machine undergoing enhancements. Stellarators, the second type of magnetic confinement device, also maintain plasma in a doughnut shape but feature a more complex design that adapts to the plasma's behavior. The Wendelstein 7-X, operated by the Max Planck Institute for Plasma Physics in Germany, has been functional since 2015. Startups like Proxima Fusion, Renaissance Fusion, Thea Energy, and Type One Energy are also exploring stellarator designs. In addition to magnetic confinement, another leading approach is inertial confinement, which compresses fuel pellets until fusion occurs. This typically involves multiple laser beams converging on a pellet from various angles. The National Ignition Facility at Lawrence Livermore National Laboratory in California has achieved scientific breakeven for this method, where the fusion reaction produces more energy than consumed, though this does not account for the energy required to run the facility. Startups like Focused Energy, Inertia Enterprises, Marvel Fusion, and Xcimer are venturing into inertial confinement, while First Light Fusion and Pacific Fusion propose alternative methods that do not rely on lasers. While these two approaches dominate the field, other innovative concepts such as magnetized target fusion and muon-catalyzed fusion are also under consideration. As the industry evolves, the potential for breakthrough solutions continues to expand, igniting hope for a sustainable energy future.