Rumors have been swirling for weeks about a new fusion startup backed by hundreds of billions of dollars from some of Silicon Valley’s biggest names. Pacific Fusion has come out of stealth with a whopping $900 million commitment to develop affordable commercial fusion energy using a “pulsed magnetic fusion” approach, which has received less funding than other nuclear fusion methods.
The Fremont, Calif.-based startup’s founders hail from the Human Genome Project, ARP-E, Lawrence Livermore National Laboratory and the National Nuclear Security Administration. Its Who’s Who list of investors includes Hemant Taneja of General Catalyst, who led the Series A round, Breakthrough Energy Ventures, Lightspeed, Lowercarbon Capital, former Google chief Eric Schmidt, Silicon Valley VC John Doerr, Ken Griffin of Citadel, LinkedIn founder Reid Hoffman and others.
Breakthroughs
Long in the making, fusion energy has the potential to produce abundant, cheap, zero-carbon energy using the same processes used by the sun. Pacific Fusion is building on recent technological advancements that are bringing fusion energy tantalizing close to commercialization, including the “net energy gain” achieved using lasers by Lawrence Livermore Labs’ National Ignition Facility in Dec. 2022, and the high performance results using pulsed magnets by Sandia National Laboratories.
The startup is building a compact, efficient system akin to Sandia’s Z Machine, using rapid magnetic pulses to squeeze hydrogen components and release energy. “In the last two years, breakthroughs in inertial fusion and pulsed power have opened a path to affordable fusion power,” Eric Landler and his Pacific Fusion cofounders said in announcing the fundraise. “We launched Pacific Fusion to build on these advances.”
Their model can be mass manufactured, have low-cost maintenance, and built from readily available materials, they said. Pacific Fusion aims to demonstrate a ‘net gain’ of fusion energy—or more energy generated than used—on its way to a commercialization sometime next decade.
Capital commitment
The $900 million Series A round — large even by fusion standards — could grow even bigger still. It will be allocated in phases based upon meeting milestones. Piecemeal financing rounds are not a good fit for capital-intensive fusion companies working on long-term timelines, explained Taneja and General Catalyst colleagues in a blog post.
“We believe this approach provides a clear roadmap upon which investors and the company can fully lock arms, and importantly, aligns capital with risk, which we think is so often lacking in long-duration, capital-intensive projects in this space and often deters venture capital investment.”
In August, Zap Energy raised a fresh $130 million for its “Z-pinch” fusion system from Breakthrough, Lowercarbon and Energy Impact Partners. Commonwealth Fusion, which is pursuing a traditional “tokamak” design to generate fusion, hauled in $1.8 billion in 2021 for a Series B round led by Tiger Global Management.
The growth of AI computing is driving demand for reliable, low-carbon energy. Tech investors have been scrambling to secure energy contracts with conventional and next generation nuclear fission power producers as well as their fusion kin—even though commerical production is in some cases years off.
Last year, Microsoft inked the first pre-purchase agreement for grid-connected fusion power – to be delivered on an ambitious 2028 timeline.
