There’s a joke in the fusion energy community that “fusion energy is always just 10 years away.” But this time, it does seem like nuclear fusion is at a turning point. In December 2022, scientists at the National Ignition Facility in the US achieved “net energy gain” in fusion for the first time. This refers to producing more energy from a fusion reaction than is put in to start and sustain it. While it sounds almost trivial and expected, it’s actually a huge milestone in the world of nuclear fusion. Put simply, it showed that nuclear fusion energy is possible (but still not practical).
The “still not practical” piece is very important for investors to keep in mind. Key challenges remain, including scaling up to useful power levels and creating materials that can withstand fusion conditions. Still, there’s growing buzz and optimism around fusion’s promise of clean, abundant energy. Private money is pouring in, and several companies are building demonstration plants. That said, most experts agree that commercial fusion energy is still at least 10-15 years away (yes, the irony is not lost on us).
Note: We make every effort to keep our information accurate and up-to-date. However, technology markets do move fast and company situations can change rapidly. Please use this guide as an introduction to the nuclear fusion energy landscape; but ultimately, do your own due diligence before taking action.
How Far Away is Commercial Fusion Energy?
The timeline to commercial fusion energy is highly variable, with several key technological advancements required along the way. That said, we can put rough boundaries on progress based on expert consensus:
Current Stage (2024)
- We’ve achieved net energy gain in a lab setting (December 2022), which is a major breakthrough. This is just the first step, albeit a big one from a “rallying the troops” perspective.
Short-Term (2024-2030)
- Demonstration Plants: Several companies are aiming to demonstrate net-positive energy production outside the lab. For example, Commonwealth Fusion Systems (CFS) plans to achieve net-positive energy by 2025 with their SPARC project. Helion Energy targets net electricity from fusion by 2024 with their Polaris machine.
- Prototype Development: Companies like General Fusion are working on building and testing prototype reactors. General Fusion aims to have a demonstration plant operational by the early 2030s.
Medium-Term (2030-2040)
- Commercial Viability: The 2030s are expected to see the first commercial fusion power plants coming online. This period will be crucial for scaling up the technology and integrating it into existing energy grids.
- Cost Reduction: Efforts during this period will focus on reducing the costs of fusion energy production to make it competitive with other forms of energy.
Long-Term (2040 and Beyond)
- Widespread Adoption: By the 2040s and beyond, fusion energy could become a significant part of the global energy mix, provided technological, economic, and regulatory hurdles are overcome. Fusion power plants could start replacing aging fission reactors and fossil fuel plants, contributing to a substantial reduction in greenhouse gas emissions.
- Global Impact: The successful commercialization of fusion energy could lead to a transformative impact on global energy supply, providing a nearly limitless and clean energy source.
Then Why Invest in Fusion Energy Companies Now?
As you can see, even the most optimistic estimates put commercial fusion energy at least 10-15 years away. So you may be wondering, “then why invest in fusion energy companies now?” That’s an excellent question, and it gets to the heart of the risk-reward balance in investing in emerging technologies.
Investors who get in early on transformative technologies can potentially see massive returns if the technology succeeds. And while commercial fusion might be far off, companies may achieve valuable milestones along the way. These milestones could drive powerful market narratives that increase their value or lead to profitable spin-off technologies. After all, the “value” of a company is simply how much the next person is willing to pay for it.
Fusion energy is seen as the holy grail of clean energy. It’s near limitless, works rain or shine, and has no fuel constraints or supply chain limitations. This disruptive potential can lead to exponential growth for successful companies in this space. It’s also why Bloomberg projects that nuclear fusion could become a $40 trillion market.
For extremely patient, forward-looking investors who want to bet on a truly revolutionary technology, this is the time to get in on the very ground floor. But for most others, it’s likely still a bit too early for comfort. Regardless, investors should only allocate funds they can afford to lose and should view fusion energy as a very long-term part of a broader investment strategy.
How to Invest in Nuclear Fusion Energy
So you believe in the future of nuclear fusion energy, and you want a slice of the pie. How do you get in? Currently, there are no publicly traded pure-play nuclear fusion stocks. The major players in the nuclear fusion sector like TAE Technologies, Commonwealth Fusion Systems, Helion Energy, and General Fusion are all still private companies.
If you’re an accredited investor, you may be in luck. Some of these fusion startups have pre-IPO shares available on sites like Hiive, EquityZen, and UpMarket. Of course, buying shares on these secondary markets carries unique risks. Make sure to do extensive research and due diligence before taking action.
But what if you’re not an accredited investor? Well, if you want to get early exposure to the growth of fusion energy, you need to get creative. Let’s explore your options:
Tier 1: Pure-Play Nuclear Fusion Energy Companies
As mentioned earlier, there are still no publicly traded nuclear fusion energy stocks. We’ll update this list as private pure-play fusion companies IPO. For now, there are several private companies to keep an eye on:
TAE Technologies is pursuing fusion with a unique approach called Field-Reversed Configuration (FRC). In plain English, it means a smaller reactor design with simpler engineering and easier maintenance. Their reactors would also produce less radioactive waste, leading to easier commercialization. TAE has been around since 1998, and is backed by major corporations like Alphabet and Chevron.
Commonwealth Fusion Systems (CFS) spun out of MIT in 2018 and has quickly become a major player in the fusion race. They’re focusing on developing advanced superconducting magnet technology to allow for smaller, more efficient fusion reactors. CFS is working on a prototype called SPARC to demonstrate net energy gain. CFS has raised significant funding from investors such as Eni, Bill Gates, and Google.
Helion Energy, founded in 2013, is taking a different tack with their pulsed magnetic fusion device. Their approach involves the use of magnetic fields to compress plasma and initiate fusion reactions in a cyclical manner. The goal is to directly convert fusion energy to electricity without the need for steam turbines. Helion’s backers include Sam Altman, Dustin Moskovitz, and Peter Thiel’s Mithril Capital.
General Fusion, a Canadian company founded in 2002, is pursuing a hybrid approach called magnetized target fusion. Their concept involves a sphere of liquid metal that’s compressed to heat and confine the fusion fuel. It’s a creative middle ground between magnetic and inertial confinement methods. The company is currently building a demonstration plant in the UK, and is backed by investors such as Jeff Bezos.
Tier 2: Energy Companies with Nuclear Fusion Interests
These energy giants are not just dipping their toes into fusion—they’re making strategic bets on a future where this revolutionary technology could reshape the energy landscape. Let’s explore what makes each of these companies a compelling, albeit indirect, play for investors eyeing the fusion space.
Chevron (CVX)
Chevron (CVX), one of the world’s largest integrated energy companies, has been making strategic moves in the fusion energy space. The company has made key investments in fusion startups like Zap Energy and TAE Technologies. Chevron’s main advantage is its vast resources and energy market expertise. Once fusion technology becomes available, Chevron could be in position to commercialize it faster and easier than almost any other company on this list.
For investors, Chevron offers a relatively safe way to gain exposure to fusion energy. The company’s core business remains in oil and gas, providing stable cash flows and dividends. At the same time, its fusion investments offer potential long-term growth. That said, keep in mind that fusion is only a tiny fraction of Chevron’s current business. An investment in Chevron is primarily an investment in traditional energy, with fusion as a “bonus” future prospect.
Chevron’s fusion strategy appears to be about hedging its bets and ensuring it has a stake in potential future energy sources. This approach could pay off handsomely if fusion becomes viable, but it won’t impact the company’s near-term performance. Investors should view Chevron’s fusion investments as a long-term play.
Eni S.p.A. (E)
Eni (E), the Italian multinational oil and gas company, has taken a more hands-on approach to fusion energy. Their significant investment in Commonwealth Fusion Systems (CFS) and active involvement in fusion research sets them apart from many of their peers. Eni’s main advantage is their direct collaboration with one of the most promising fusion startups. This could give them a first-mover advantage if CFS’s technology proves successful.
For investors, Eni represents a more focused bet on fusion energy within the traditional energy sector. The company’s commitment to fusion research is more pronounced than many of its competitors, suggesting a serious long-term strategy rather than a hedge. However, like Chevron, Eni’s core business remains in oil and gas, providing a stable foundation for the company.
Eni’s fusion strategy appears to be about positioning itself at the forefront of the potential energy transition. This could be a significant advantage if fusion becomes viable, allowing Eni to pivot more quickly than its competitors. However, it also exposes the company to more risk if fusion technology doesn’t pan out as hoped. Investors should consider Eni if they want exposure to both traditional energy and a more aggressive stance on fusion… but should be prepared for potential volatility if fusion milestones are delayed or not achieved.
Cenovus Energy (CVE)
Cenovus Energy (CVE), a Canadian integrated oil and natural gas company, has taken a unique approach. They’ve partnered with General Fusion to explore how fusion energy could be applied to Cenovus’s operations, particularly in oil sands production. Thus, Cenovus’s angle is its practical, application-focused approach to fusion energy.
For investors, Cenovus offers an interesting middle ground. Cenovus’s fusion strategy is about finding synergies between fusion and its current operations. This could provide a clearer path to commercialization than some purely research-focused efforts. Investors should view Cenovus as a way to gain exposure to both traditional energy and practical applications of fusion technology.
Tier 3: Indirect Beneficiaries of Fusion Technology
While the spotlight often shines on pure-play fusion stocks, there’s a whole ecosystem of businesses whose existing technologies and expertise could be vital in making fusion energy a reality. These companies, though not directly involved in fusion research and development, could reap significant rewards as this groundbreaking technology matures.
Babcock International (BCKIF)
Babcock International (BCKIF) is a British multinational corporation specializing in engineering services. They bring a wealth of experience in complex, large-scale projects to the table. Their expertise in nuclear infrastructure projects could be invaluable for building fusion reactors. In fact, Babcock is already a key player in the UK’s fusion energy program. Babcock offers investors a potential way to participate in fusion energy via infrastructure. As fusion moves from experimental to practical applications, companies like Babcock would play a crucial role in designing, constructing, and managing fusion facilities.
Siemens (SIEGY)
Siemens (SIEGY) is a global technology giant that brings a wealth of experience in power engineering and automation systems. Their expertise in power grids could be crucial for integrating fusion power plants into existing energy infrastructure. Also, their advanced automation and control systems could help ensure the safe and efficient operation of complex fusion reactors. Investors should consider Siemens as a long-term play on the broader electrification trend, with fusion energy potentially adding an additional layer of growth potential.
Honeywell (HON)
Honeywell (HON) is a global technology and manufacturing conglomerate with deep expertise in automation and control systems. Their advanced technologies could be essential for monitoring and managing the complex processes within fusion reactors, ensuring optimal performance and safety. Also, their experience in developing specialized materials and sensors could contribute to the creation of more efficient and reliable fusion systems. Investors should view Honeywell as a potential beneficiary of the broader trend towards automation and advanced technology in the energy sector, with fusion energy offering a potential long-term growth catalyst.
General Electric (GE)
General Electric (GE), a household name in power generation, has a long history of innovation in energy technologies. Their experience in designing and manufacturing turbines, generators, and other power plant components could be valuable for the construction of fusion facilities. Moreover, their research and development efforts in advanced materials, such as high-temperature superconductors, could play a crucial role in enabling the high-performance magnets needed for fusion reactors. Investors should consider GE as a broad play on the energy sector, with the potential for fusion energy to add another dimension to their growth story.
