A fusion startup backed by Jeff Bezos just raised another $65 million, signaling that investors are still betting on this 'Holy Grail' technology.
- General Fusion, an energy startup backed by Jeff Bezos, just closed a $65 million funding round, led by the Singapore-based investment firm Temasek. The company plans to use the funds to build a demonstration power plant to test its fusion technology on a commercial scale.
- General Fusion is among a handful of fusion startups that have been backed by prominent venture capital funds, such as Bill Gates' Breakthrough Energy Ventures. If successfully commercialized, fusion could provide a clean source of energy without many of the drawbacks of nuclear fission, like the production of hazardous waste.
- Fusion is a promising technology, but inventing a power plant that produces more energy than it uses is incredibly costly. Experts worry that there's not enough money to commercialize the technology in the near term. Even with ramped-up public funding, commercial fusion won't be possible until the late 2030s at best, they say.
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A fusion energy startup backed by Jeff Bezos just closed a $65 million funding round, led by the massive Singapore-based investment firm, Temasek.
The company, General Fusion, will use the funds to start building a demonstration power plant to test its fusion technology on a commercially-relevant scale.
"This represents the first effort to build a power-plant scale, power-plant relevant prototype fusion machine," General Fusion's CEO Christofer Mowry told Business Insider. "This is really the springboard for General Fusion and, frankly, for a community of private fusion companies around the world. This is what I call the SpaceX moment for fusion."
General Fusion is among a handful of fusion startups attracting high-profile investors in recent years. Commonwealth Fusion Systems, a competitor backed by a Bill Gates-led fund, closed a $115 million round in June, and Alphabet-backed TAE Technologies raised $375 million in 2016, according to data from PitchBook.
That's because the stakes are so high. If successfully commercialized, fusion could provide a powerful source of clean energy without many of the drawbacks of nuclear fission (typically referred to as "nuclear energy"), such as the production of hazardous waste.
But experts say that achieving commercialization is still a long way off, not to mention, incredibly expensive.
Creating a commercial device that generates a net gain in energy - meaning, it emits more energy than it takes to operate - will likely require tens of billions of dollars; $65 million is just a drop in the bucket. That's one reason why many private investors have been reluctant to fund fusion startups. These companies are still a better fit for public funding, they say.
"It's pretty daunting," said Tom Blum, an investor, and member of Clean Energy Venture Group. "That's got to be funded by federal money and a few billionaires because nobody else can write those checks."
A source of clean energy
If you're unfamiliar with fusion energy, you're not alone.
At a basic level, fusion is the process that powers the sun: The nuclei of hydrogen atoms crash into each under extreme heat and pressure, causing them to fuse together and form the nuclei of another, heavier element - helium. This results in a loss of mass and a huge surplus of energy.
That energy is mostly clean and relatively safe, compared to nuclear fission. And so for decades, scientists have been trying to find a commercially feasible way to fuse hydrogen atoms here on Earth.
The most common approach involves using two forms of hydrogen atoms, called deuterium and tritium. They fuse together relatively easily, but the process still requires a tremendous amount of pressure - and a temperature as high as 150 million degrees Celsius.
To achieve this, most companies and public labs use an obscure device, shaped like a hollow bagel, called a tokamak. Inside a typical tokamak is a superheated hydrogen gas containing deuterium and tritium that's surrounded by superconducting magnets. Those magnets heat and compress the gas until fusion occurs.
General Fusion's approach is innovative but risky, experts say
What General Fusion is doing is slightly different. Like the more traditional tokamak, the startup uses a magnetic field to contain the hydrogen gas inside a hollow vessel. But in this case, the vessel is spherical and the hydrogen gas is surrounded by a spinning vortex of liquid metal.
It gets more extreme: The outside of the sphere is surrounded by hundreds of pistons that simultaneously strike the liquid metal, pushing it inward to heat and compress the plasma. If all goes as planned, that compression spurs fusion.
"Our approach to fusion is something akin to a fusion version of a diesel engine," Mowry said. "The process requires that these pistons reliably, repeatedly, and at very high precision move in a very controlled fashion."
General Fusion has tested this approach, Mowry says.
"We have built full-scale pistons," he said. "We have proven the performance required for this demonstration plant to work."
But like many of the other fusion technologies, it hasn't been tested on a commercially relevant scale. According to Malcolm Handley, an expert on fusion commercialization at the Advanced Research Projects Agency-Energy, known as ARPA-E, General Fusion's approach is innovative - but challenging.
"The big challenge to what they're doing is that it involves on the order of 300 pistons that all need to fire at once within a pretty short amount of time in order for these conditions to actually occur," he said. "The worst part of it is that you don't really get to do that experiment until you've built 300 pistons, which takes a whole lot of money."
Now, General Fusion says it's well on its way to getting the necessary financial support.
What it will take for General Fusion to prove its technology
General Fusion will use the injection of funds to construct a demonstration plant, where it can test its technology at a large scale. The finished plant would have a capacity on the order of 100 megawatts (an average onshore wind turbine is 2.5 to 3 megawatts), Mowry says, though the company isn't sure yet where it will be built.
The demonstration plant will test to see if General Fusion's technology can be commercialized - that is, if it can produce gain, or more energy than what it requires as an input. It will also confront technological challenges that Mowry says have dragged the industry.
"There's historically been a problem with material degradation," Mowry said. "In a lot of approaches to fusion, the machine itself gets degraded pretty quickly. This is really proving out at a power-plant-relevant scale that the approach we have is practical and works."
The startup plans to complete the project in the next 5 1/2 years, Mowry says. But hitting that deadline will likely depend on acquiring more than $300 million in support, and the company is only about a third of the way there.
Who's funding fusion?
Until recently, fusion technology has been in the hands of massive research institutions, such as ITER - a gargantuan fusion project, with an estimated $25 billion price tag. These organizations have mostly focused on achieving net gain and proving the science works.
Now that we know it does, what remains is commercialization. And at least a dozen private companies are hoping to be the first to get there - including General Fusion.
The challenge is that, even with sound science, fusion is a hard sell to private investors. It's capital intensive and slow-moving, and there's still a lot of de-risking to do. That makes it a relatively poor fit for VC funding, according to Handley, who ran a fusion-focused venture fund before joining ARPA-E.
"The caveat I think is that most of the companies at the moment are very small and very early and going after private funding because they perceive they cannot get the money publicly," he said. "But they're actually better fits for public funding."
That might be one big benefit for General Fusion - it's attracted a lot of both private and public money - and Mowry says that both funding sources are starting to bulk up their support for private companies.
"Large government programs and governments themselves are beginning to pivot away from just purely science programs to investing either directly or indirectly in programs that seek to commercialize the technology," he said. "I think that's just another great signpost that the collective community sees the fact that it's really fusion at the time now."
But not everyone agrees. While many experts are confident that fusion will play a large role in the future of energy, they say the technology just isn't there yet.
"Fusion is the Holy Grail," Louis Brasington, a researcher at the analytics firm Cleantech Group, said. "What we find is the progress is very slow. At the moment there are still a lot of issues. "
And to overcome them, Handley says that public institutions will need to step up.
"My current belief is that the federal government and other national governments need to be doing more to support these companies at this stage," he said. "America needs to wake up and say this might very well be the energy source of the future."