Source: European Investment Bank
If fusion succeeds, the implications for energy systems are enormous. In theory, fusion could provide a virtually limitless source of clean energy. But in practice, other energy sources — including renewables and nuclear fission — will continue to coexist for many decades. Energy demand is rising rapidly, and existing technologies with installed capacity will not be abandoned. However, the relative importance of fossil fuels could decline significantly if fusion becomes a reality, because fusion could provide the stable baseload power that fossil fuels supply today.
Fusion sits within the broader category of deep tech — technologies based on scientific breakthroughs that represent fundamental change rather than incremental improvements. For investors, fusion is very different from established renewable energy or fission projects. Traditional energy investments rely on mature regulatory frameworks and predictable returns. Fusion requires patient, long-term capital willing to take risks on milestones that are still ahead. This attracts a different investor profile: public and private venture capital, sovereign wealth funds, and those prepared to invest for the long-term in technologies that could deliver very large payoffs if successful.
There are two major technological approaches to fusion:
• Magnetic confinement fusion, which uses strong magnets to confine extremely hot plasma containing fusion fuel
• Inertial (laser) confinement fusion, which uses powerful lasers to compress a fuel target
Both aim ultimately to produce heat and electricity. Both approaches have attracted significant funding. Over the last five years, more than $10 billion has gone into private fusion projects, with magnetic confinement receiving the largest share. The best-funded company is Commonwealth Fusion Systems in the United States, which bases its research on tokamak reactors — large machines that use strong magnets to contain plasma.
Europe retains the capability to play an important role in the future of fusion, but only a small share of the global private fusion funding has gone to European companies. Still, firms such as Proxima Fusion and Marvel Fusion have raised major rounds from prominent investors, showing strong momentum.
If fusion becomes a reality, the consequences would be immense — for the climate, the economy and even global geopolitics. Some say that if fusion succeeds, it could solve half of the world’s major problems.