US nuclear fusion start-up backed by Sam Altman and Peter Thiel secures $425mn

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A US start-up whose backers include tech billionaires Sam Altman and Peter Thiel has raised $425mn to keep it on track to achieve its target of producing electricity from nuclear fusion in 2028.

Helion has the most ambitious timeline among start-ups racing to develop nuclear fusion, a long sought-after technology that combines hydrogen atoms to form helium atoms and release a significant amount of energy.

Venture capital firm Lightspeed and SoftBank’s second Vision Fund are the investors joining OpenAI boss Altman, Thiel’s Mithril Capital and steel company Nucor in backing Helion. The start-up has now raised more than $1bn and has a valuation of $5.4bn, including the latest fundraising round.

Nuclear fusion is carbon-free and creates no long-lived radioactive waste, but scientists have only been able to sustain a reaction for short periods of time. Earlier this month, Chinese scientists set a new record of 1,066 seconds in a reactor in Hefei, according to state media.

Helion has a contract to start supplying Microsoft with electricity produced from its fusion system in 2028, and the new funds would put it “on course” to achieve the goal, said chief executive David Kirtley. The company also has an agreement to build a 500MW power plant for Nucor.

Kirtley said the money would be spent on manufacturing pulse capacitors, an important component of its Polaris reactor in the US.

He said: “The capacitor is where about a third of the cost of the whole system goes, and about 85 per cent of Polaris’ capacitors were built overseas. We bought them and waited several years to get them in-house.”

Kirtley added: “We are now the first US manufacturer of large-scale pulse capacitors in decades, and we are going to expand that. So rather than waiting three years, we could get them in a year or less.”

He said Polaris, the company’s seventh-generation reactor, was “in operation” but declined to share details about its results.

“We have a technology that can be built, built quickly and iterated upon, especially relative to other fusion,” he said, adding that Helion’s design was “smaller, cheaper, easier to build and with less concrete”.

The remaining challenges for the start-up lie on the regulatory side, where Helion needs state permits to deploy power plants, and on squeezing more efficiency from its engineering, he said.

Kirtley added that “it would not change anything” if the development of AI, a vital driver for investment into energy companies, turns out to be less power intensive than estimated.

“There is a huge need [for baseload power] even more than we thought before. So if that extra need is a little bit less, that is OK too,” he said.