Hi Jeff, it's refreshingly great to have you back in my inbox! On June 2, 2023 you answered (at the previous place) a question I posed about nuclear fusion. Soon thereafter you were gone. I had questions that ranged between shocked and what???? Anyway, during the past almost six months, I've heard almost nothing about nuclear fusion. I'd love to know what insights you're seeing and what you're projecting will happen in the next year or two. So glad you're back! — Mike H.
Hi Mike, thank you for the warm welcome back. It’s mutual — it’s great to be back at it.
It’s hard for me to contain my enthusiasm for what’s happening right now in the world of technology and biotechnology.
The last 12 months have been just incredible in the world of artificial intelligence. But the reality is that there has been incredible progress in just about every field.
I can see the “acceleration” of technological development everywhere. Everything is speeding up.
There is opportunity everywhere. And now, with Brownridge, I have a platform from which I can share these insights and investment opportunities with my subscribers as I wish — independent of any outside influence or oversight.
And, as you know, nuclear fusion is one of my favorite topics. I’ll also be very direct in saying that there can be no serious discussion about clean energy, or net zero, without including nuclear fusion technology.
I’m happy to say that there has been some incredible building in the industry happening this year that sets the stage up for an incredible 2024.
As a quick refresher, we’ll recall that nuclear fusion is not nuclear fission. It’s a common misunderstanding.
Nuclear fission is what most people mean when they talk about nuclear energy. It’s the process splitting an atom’s nucleus into two or more smaller nuclei, which produces energy.
Nuclear fusion, on the other hand — a favorite topic of mine — is the kind of energy produced by the Sun. This happens when two hydrogen nuclei merge together, unleashing a huge amount of energy.
Unlike nuclear fission, a key advantage of fusion over fission is that it can produce energy with minimal or sometimes even no radioactive waste.
Developments in nuclear fusion continue to be driven by what is happening in the private sector. And almost every company working in this exciting industry is still private.
This is not a surprise, as most nuclear fusion companies are still pre-product revenue, which means that they tend to be funded by venture capital and private equity firms that have longer time horizons.
For perspective, by July of 2022, about $4.8 billion had already been invested into nuclear fusion in the U.S. Of that, only $117 million of that funding was from government grants.
What the mainstream media will proclaim is gibberish, like “the U.S. is behind in nuclear fusion.” But it’s all nonsense.
The most advanced research and development in nuclear fusion has been happening in the U.S., and it is happening at private companies. The heavy involvement of the U.S. government is not required to make it “real.”
As of this summer, the level of investment increased to $6.2 billion with just $271 million coming from government grants. That means that only 4.4% of total investment in nuclear fusion is coming from the U.S. government.
In short, the private sector is thriving in nuclear fusion.
What’s different about this year compared to 2022 is the breadth of investment.
In 2022, the large jump in investment was heavily skewed by the massive $1.8 billion raise by Commonwealth Fusion Systems (a spin out of MIT), and the $500 million raise by Helion Energy.
This year has been quite different. We’ve seen a much larger number of funding rounds across a wide range of companies in the nuclear fusion industry. This is a great indication of a major trend and a sector on the rise. I expect a lot more of that in 2024.
The same is true about the public sector. Subscribers may recall when I was writing about the breakthrough at the government-funded Lawrence Livermore National Laboratory (LLNL) back in December of 2022.
The LLNL houses the National Ignition Facility (NIF), which is a massive facility the size of a football field — with 192 lasers precisely tuned to fire on a single point containing fuel for a nuclear fusion reaction.
On December 5, 2022 it demonstrated the ability to create a net energy output using the NIF. More specifically, the amount of energy the lasers discharged was less than the amount of energy that was emitted from the fusion reaction, which lasted microseconds.
This summer, the NIF was able to reproduce the net energy output experiment again on July 30th. The reaction created 3.15 megajoules from 2.05 megajoules of laser output. Yes, this was exciting. And yes, it is a breakthrough, but not very significant in the context of commercializing nuclear fusion.
I wrote about this quite a bit in my past publication, The Bleeding Edge, and also was invited onto the Glenn Beck radio show on December 12 and December 14 of 2022, both prior to the NIF announcement and immediately after.
Glenn wanted to get my take — both before the formal announcement, and then after the technical briefing so that we could understand what exactly took place.
The point I made that month was that while it was an incredible scientific breakthrough, it was largely a public relations stunt.
The net energy gains excluded the amount of energy required to charge up the lasers. When we factor this in, more total energy was required to create the fusion.
Also worth noting is that similar tests had also been conducted in the past at NIF. That’s okay. It’s still an impressive achievement, and it proves that fusion works. The “sunk energy cost” of charging up the lasers becomes negligible once a sustainable fusion reaction is achieved.
One of the more interesting comments from the NIF engineering team responsible for the experiment was their comment that there have been far more exciting developments in nuclear fusion, as it pertains to commercialization, elsewhere — specifically, in the private sector.
The reality is that the public sector — these research laboratories — were watching billions of dollars flood into the private sector into nuclear fusion technology. And yet, the U.S. government grants were miniscule.
They needed to create an “event” that would generate excitement, and something that they could use to attract budget/grants to pay for their salaries and research. That’s the rub
The private sectors, however, are where all the action has been — the real action, the kind of investment and work that will lead to clean, limitless, and extremely cheap energy for the planet.
Here are a few highlights from this year:
The reality is that the U.S. government has been woefully behind in supporting nuclear fusion as the best path for clean energy.
In fact, the current administration has stifled natural gas production in the last three years. The net result has been a significant increase in the use of coal in the U.S. for the production of electricity. I wouldn’t call this clean energy policy — quite the opposite.
Fusion is however starting to gain some momentum with the government and has received some attention at this month’s COP28 climate conference in Dubai. I don’t want to give the bureaucrats any credit here, details were seriously lacking, but at least politicians and policymakers are starting to talk about it.
As for the next year or two, it’s going to be amazing for fusion.
Commonwealth Fusion Systems, which has raised $2 billion to date, expects to have its Tokamak prototype reactor working by 2025.
I’m also expecting great progress from General Fusion, Helion, TAE Technologies, and Zap Energy next year.
We’ll also start to see the emergence of smaller companies that will play critical roles in building the supply chain necessary for commercialization of nuclear fusion next year.
As I speak with founders and executives working in this space, I’ll be looking for nuclear fusion related investment opportunities in private companies.
If you are a founder/executive at a nuclear fusion company, and are interested in raising capital via crowdfunding regulations, please upload your pitch deck and tell me about your company. I’d be very happy to review it. You can do so at the link here.
To wrap things up, Mike, the next 24 months are going to be incredible. I predicted very publicly back in 2019 that we would see the very first net energy fusion reaction within this time frame. That of course happened with the NIF experiments in December 2022 and again this summer.
But I’ll also maintain that we’ll see another prototype reaction that produces net energy from one of the most promising private companies.
This is a multi-trillion dollar industry just waiting to happen and usher in a world of limitless, clean energy. I can’t wait.
