Fusion power darling Commonwealth Fusion Systems raises another $1B

Commonwealth Fusion Systems (CFS) has long been the best-funded fusion power startup. Now, it’s extending its lead.

CFS announced Thursday that it raised $1 billion in a new round that included “significant institutional investors, such as pension funds, sovereign wealth funds, and infrastructure and industrial corporate partners,” the company said. When asked by TechCrunch, the company declined to name the specific investors. To date, CFS has raised $4 billion.

The funding arrives as the company’s spending ramps up. CFS is currently building Sparc, its demonstration reactor, and finalizing the design of Arc, its first commercial power plant. 

The company said the new funding will go toward commercializing fusion, and CEO Bob Mumgaard has hinted that CFS will continue to raise more capital.

CFS hasn’t disclosed either Sparc’s or Arc’s price tag, though in 2024, Virginia’s former governor Glenn Youngkin said that Arc would be a “multi-billion-dollar fusion power plant.”

This is CFS’s largest round since raising $1.8 billion in 2021. The startup’s previous fundraise, announced in August, added $863 million to its coffers and included Nvidia, Google, Khosla Ventures, and Breakthrough Energy Ventures among its investors. 

CFS is pursuing a form of fusion known as magnetic confinement, in which powerful magnetic fields confine plasma inside the reactor, keeping the plasma dense and hot enough to spark fusion reactions. When atomic nuclei from the fusion fuel fuse, the reaction releases enormous amounts of energy. CFS plans to harvest the heat thrown off by the reaction to power a steam turbine.

The company has made significant progress on its Sparc reactor, which it now expects will achieve scientific breakeven in 2027. 

Scientific breakeven is a key milestone at which fusion reactions release more energy than the reactor consumes to ignite them. It’s not enough to generate electricity for export to the grid, but hitting the mark will show investors that CFS’s approach is likely to bear fruit. To date, only one fusion device, at the Lawrence Livermore National Laboratory’s National Ignition Facility, has achieved scientific breakeven.

Alongside work on Sparc, CFS has been finalizing the design for Arc, the commercial-scale power plant planned for Virginia. Italian energy company Eni said it will buy more than $1 billion worth of electricity from Arc, while Google has committed to buying 200 megawatts of electricity, or half of Arc’s total output.