Helion Energy has raised $425 million in a Series F funding round, reinforcing its position as one of the most closely watched fusion energy startups.
The company, which signed a 50-megawatt power purchase agreement (PPA) with Microsoft in 2023, is working toward a commercial fusion power plant by 2028—an aggressive timeline in a field where no private company has yet achieved net energy gain.
The latest investment round, which brings Helion’s valuation to $5.245 billion, was led by Lightspeed Venture Partners and SoftBank Vision Fund 2 and includes a major university endowment.
Existing investors Sam Altman, Mithril Capital, Capricorn Investment Group, Dustin Moskovitz, and Nucor also participated. Helion CEO David Kirtley emphasized that the funding will primarily support in-house manufacturing of capacitors, semiconductors, and magnets, key components necessary to scale the company’s reactor technology.
Kirtley explained the motivation behind bringing more production in-house, stating, “Our goal is to go from waiting three years for a supplier to give us capacitors to us making our own capacitors but faster, so now we can make them in a year or less.”
The company has already begun expanding its internal supply chain operations to speed up component availability and avoid long lead times that have historically slowed development in the fusion sector.
A Unique Approach to Fusion Energy
Helion differentiates itself from other fusion companies by using a field-reversed configuration (FRC) reactor, a design that diverges from the tokamak (magnetic confinement) and inertial confinement (laser-based) approaches.
Instead of heating plasma to extreme temperatures in a steady-state reaction, Helion’s method accelerates magnetized plasma rings to over 1 million miles per hour, colliding them inside a compression chamber to trigger fusion.
Unlike traditional fusion reactors that rely on superheated steam to drive turbines, Helion’s system extracts energy directly from the magnetic field interactions produced during fusion pulses.
This approach could lead to a higher efficiency system that circumvents the energy losses associated with steam-driven power plants. Kirtley explained, “The energy added by the fusion reactions generates a surge in magnetic force, which pushes back on the reactor’s magnets. This extra magnetic force is then converted directly into electricity.”
Helion also uses helium-3 as a fuel source, an isotope that differs from tritium-based fusion systems. Helium-3 has potential applications beyond energy, including use in quantum computing and nuclear detection technologies.
This fuel choice allows for lower radiation output and reduced regulatory complexity, though it presents supply challenges since helium-3 is rare on Earth.
The company’s next commercial reactor is designed to pulse several times per second, eventually targeting grid-matching frequencies of 60 pulses per second.
However, Helion has acknowledged that achieving this rate presents engineering challenges, particularly in managing the high-power demands of each pulse and ensuring reactor stability over continuous operation.
Microsoft’s Expanding Investments in Nuclear and Fusion Energy
Helion’s funding round aligns with Microsoft’s broader long-term energy strategy, which increasingly focuses on nuclear and fusion power as solutions for its AI-driven data center growth. In 2023, Microsoft became the first major corporation to commit to purchasing fusion-generated electricity, signing a binding agreement with Helion that includes financial penalties if power is not delivered as agreed.
In addition to its deal with Helion, Microsoft has been exploring small modular reactors (SMRs) as part of a strategy to secure stable, carbon-free power for its cloud operations. The company has actively pursued nuclear energy solutions through partnerships with Ontario Power Generation and other nuclear providers, and has even explored reviving the dormant Three Mile Island nuclear plant to repurpose it for data center power needs.
Microsoft’s approach to nuclear energy extends beyond conventional power generation. The company has been actively hiring nuclear engineers and energy strategists to develop a roadmap for integrating small modular reactors and microreactors into its long-term infrastructure plans.
The AI Energy Demand Problem and the Role of Fusion
The push for fusion energy is largely driven by the rapidly growing electricity demands of artificial intelligence and cloud computing. OpenAI, which currently relies on Microsoft’s Azure cloud infrastructure, has reportedly explored a separate deal with Helion.
Although OpenAI CEO Sam Altman is a major Helion investor and board member, he has recused himself from negotiations to avoid conflicts of interest.
The anticipated launch of OpenAI’s massive Stargate Project supercomputer project—estimated to require at least five gigawatts of power—has further increased interest in new energy solutions. While Microsoft’s 50-megawatt deal with Helion is relatively small, it represents an early step toward larger-scale fusion adoption.
Other tech giants are also turning to nuclear energy as AI infrastructure expands. Google recently signed a deal with Kairos Power to build seven small modular reactors (SMRs) to power its data centers, and Amazon has invested in modular reactor technology through partnerships with Dominion Energy and Energy Northwest.
Technical and Market Challenges of Nuclear Fusion
Despite the enthusiasm surrounding fusion energy, Helion and its competitors face several obstacles before commercial viability can be achieved.
One of the biggest challenges remains net energy gain—the ability to produce more energy from fusion than is consumed to sustain the reaction. Helion has yet to publicly demonstrate a sustained fusion reaction that generates excess energy, a threshold that remains elusive across the industry.
In recent years, researchers at Lawrence Livermore National Laboratory have achieved fusion ignition in laboratory experiments, but commercial-scale power plants are still years away.
Helion is not alone in the race for fusion power. Commonwealth Fusion Systems, an MIT spinout, has raised over $2 billion, while California-based TAE Technologies has secured $1.2 billion.
Zap Energy, another Seattle-based fusion startup, has raised $330 million for its own compact fusion reactor technology. These companies are pursuing different approaches to solving fusion’s core challenges, from superconducting magnet advancements to alternative fuel cycles.
Another hurdle is regulatory approval and grid interconnection. Helion has been working on securing permits for its first commercial plant, but long permitting timelines and infrastructure requirements could delay deployment.
The company has not yet publicly disclosed the final location for its first power facility, though it has been in discussions with state regulators and utility partners for years.
Despite these challenges, Helion remains optimistic about its progress. “We will be radically scaling up our manufacturing in the US – enabling us to build capacitors, magnets, and semiconductors much faster than we have been able to before. This accelerates the construction of the world’s first fusion power plant and then all our plants to come,” Kirtley is quoted in the company’s funding announcement. “This accelerates the construction of the world’s first fusion power plant and then all our plants to come.”
What’s Next for Helion?
Helion’s next steps include finalizing the site for its first fusion power plant and expanding its internal supply chain to reduce production bottlenecks. The company will also continue testing its latest prototype, Polaris, which is designed to validate the energy capture and plasma confinement technology required for commercial deployment.
If Helion meets its 2028 goal, it could become the first private company to supply fusion-generated electricity to the grid. However, with no fusion company yet demonstrating sustained net energy gain, skepticism remains high. Whether Helion or one of its competitors reaches that milestone first will determine how soon fusion energy becomes a viable part of the global power grid.
Last Updated on February 5, 2025 12:13 pm CET