Fusion Power received another boost on Monday when Google announced that it will buy half the output of the first commercial power plant of the Commonwealth Fusion System.
Commonwealth Fusion Systems (CFS) will send Google 200 Megawatt electricity from its Boogcentrale, which is expected to be online in the early 2030s. In the meantime, Google CFS is sending a check as part of a new, unannounced financing round.
The new round will be “similar” to the previous one, said CFS co-founder and CEO Bob Mumgaard. The most recent financing round of CFS, a series B in which Google participated and delivered $ 1.8 billion, closed in 2021. The company has increased the most from every startup.
“That is a very strong question signal,” said Mumgaard. “This investment enables us to do part of the R&D with which we can go to Boog faster.”
CFS is building a demonstration reactor, known as SPARC, just outside of Boston. According to Mumgaard, that facility will be completed in 2026. ARC, the commercial power plant of the company, will be built near Richmond, Virginia.
The new deal only marks the second time that a large company has agreed to buy electricity at a Startup merger. The first was signed in 2023 when Microsoft agreed to buy the output of the first commercial power plant in Helion, which will be online online in 2028.
Just like other hyperscalers, Google has searched the whole world for new sources of electricity. AI and Cloud Services have inflamed an increase in the construction of data center, which applies a new wave of electricity demand. One prediction expects that the electricity demand from the data center will double by the end of the decade.
“To drive all this, we know that we have to make large bets in this next border of energy innovation,” said Michael Terrell, head of Google, advanced energy.
Google is thinking of its energy investments in three time horizons, Terrell said. In the short term, the company has given priority to solar, wind and batteries. A little further away, it is gambling on geothermal and small modular nuclear reactors, as evidenced by his investments in geothermal startup Fervo Energy and Nuclear Startup Kairos Power.
Fusion Energy is a little further away, and that would certainly say this [CFS investment] In the long term category, “he said.
Google bought 8 gigawatts of renewable electricity in 2024, twice what it puchased in 2023. And although solar, wind and batteries have been the most important additions for the Google portfolio in recent years, Terrell told Techcrunch that the company needs other energy sources to make its data centers work 24/7.
“There is definitely a path with wind and solar energy and storage in regions where the source is very strong,” he said, with reference to places such as the Midwest, which has consistent winds, and the southwest, which mainly has cloud-free skies. But other places, such as the southeastern US and many provinces in the Asia-Pacific region, may be too cloudy or their power gratings are too fragmented to make traditional renewable energy sources work.
To compensate for these shortcomings, there is an approach to transfer wind and solar energy, but that can quickly become expensive.
Technologies such as Fusion “actually bring the costs to achieve high penetrations of carbon -free energy,” Terrell said. “If you have these clean, sturdy technologies even if they are more expensive by megawatt-hour and you fold it some sort of these in the portfolio, this actually brings your total portfolio costs down.”
Mumgaard is convinced that CFS can deliver electricity to Google in less than a decade, and when that happens, he thinks that the demand for merger will rise.
“It does not depend on geography or again, does not depend on access to special materials. It is something that you could perform 24/7,” he said. “We expect that Fusion can have a very large payout, because once it has been shown that you can do this and you have a first power plant, you could scale it. You could build this all over the world.”
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