Fusion power, initially linked to thermonuclear bomb science, is seeing a renewed focus on defense applications. This shift is occurring as fusion startups, while still pursuing grid-scale electricity generation, are finding new avenues for funding and technology development within the defense sector. The National Ignition Facility, a key site for fusion experiments, has supported national security for over 25 years.
The acceleration of defense partnerships is partly driven by a slowdown in venture capital committed to climate tech, which has traditionally funded fusion startups. Fusion research is capital-intensive, and venture capitalists are open to portfolio companies securing alternative funding sources. The defense industry provides this alternative.
The defense industry's interest in laser weapons has grown significantly due to the impact of drones in modern warfare. Traditional air defense systems are inefficient against numerous, inexpensive drones, as demonstrated by instances where expensive missiles were used to shoot down low-cost consumer drones. Laser weapons offer a more cost-effective and rapid solution, firing quickly and using electricity rather than single-use missiles.
Laser-based fusion startups are well-suited for developing these advanced weapons. Xcimer, a startup focused on laser-based fusion reactors, recently announced a partnership and investment from RTX, which includes defense contractor Raytheon. This agreement provides Xcimer with funding from RTX Ventures, while RTX gains access to explore Xcimer's powerful laser technology for defense applications.
Denver-based Xcimer operates what it states is the largest privately owned laser system globally, named Phoenix. The company plans to use this technology to develop a power plant where lasers will compress fuel targets to initiate atomic fusion and release energy. The current Phoenix system operates at a lower power level than what will be required for a full-scale power plant.
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Fusion power startups are increasingly partnering with the defense industry as climate tech venture funding slows. This collaboration provides new funding sources for expensive fusion research and allows defense contractors to explore advanced laser technologies for weapons systems. Xcimer, a laser-based fusion startup, recently announced an investment and partnership with RTX, a defense conglomerate.