UK kickstarts StarMaker One for UK fusion power boost

The UK government has allocated £20m to initiate an investment fund dedicated to fusion power technology. The StarMaker One fund is aiming to raise up to £150m (€175m, $200m) to support fusion businesses and start-ups in scaling up and commercializing their operations. This venture marks the first early-stage fusion energy venture capital fund outside the US, with the unique aspect of having government involvement as an investor.

The primary objective of this initiative is to stimulate additional investment from the private sector as the fusion industry continues to expand. The financial boost will enable smaller companies to provide essential training for their workforce in critical areas such as physics, engineering, and chemistry. Moreover, it will assist companies in developing technologies and seizing opportunities in various markets related to fusion energy, including magnetics, industrial AI, robotics, healthcare, transportation, and energy storage.

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One of the challenges identified by companies in the UK is the lack of access to capital, which hinders their ability to scale up and commercialize their businesses. By injecting funds into the sector, the UK government aims to instill confidence in the private sector to invest in fusion technology. However, this effort faces competition from the increasing presence of small, modular fission reactors that are now being utilized to power AI data centers.

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East X Ventures in London, a subsidiary of a commodities fund, has been appointed as the fund manager for StarMaker One. The UK government will receive a portion of any returns generated by this partnership. Notably, the fund manager previously led the investment in UK Atomic Energy Authority spinout Tokamak Energy, securing $125m in funding last year to advance its high-temperature superconducting (HTS) technology business, TE Magnetics.

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Established in 2009, Tokamak Energy is the sole private fusion company with over a decade of experience in designing, constructing, and operating tokamak fusion reactors. The company has raised $275m from private investors and $60m from the UK and US governments. This funding is facilitating a pilot plant design program and the testing of a high-field spherical tokamak at its facility near Oxford, UK.

Another fusion technology player in Oxford is First Light Fusion, which is also engaged in the development of a fusion reactor. Energy Secretary Ed Miliband emphasized the potential of fusion to enhance energy security, attract cutting-edge technologies to the UK, and nurture the next generation of British scientists and engineers. The government has already committed £410 million to fusion research and collaboration with international partners.