The Dark Horse That Could Deliver the World's First Fusion Reactor

By Haley Zaremba - Mar 04, 2026

• Germany has become a surprising dark horse in the race for commercial nuclear fusion by committing €1.7 billion in funding to build the world's first commercial fusion reactor.
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• German company Proxima Fusion is partnering with the Free State of Bavaria, RWE, and Max Planck Institute for Plasma Physics to build a stellarator fusion power plant aimed at demonstrating net energy gain.
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• The race for commercial fusion is increasingly moving toward public-private partnerships, driven by the accelerating need for energy, partially fueled by the AI boom.
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The race is on to achieve commercial nuclear fusion. While the technology was first conceptualized a full century ago, the ambition to replicate the process that powers our sun here on Earth has only recently exited the realm of sci-fi ambitions into reality. Fueled in part by the accelerating need for energy thanks to the AI boom, nuclear fusion is receiving more attention and investment dollars than ever before, and breakthroughs are starting to pile up. While China and the United States are leading the charge in a high-stakes battle for commercial fusion supremacy, a surprising dark horse may be about to take the lead.

Germany has taken major steps forward in the development of what could soon be commercially viable nuclear fusion facilities in the past few years. In 2025, German Chancellor Friedrich Merz unveiled new action plan for the nation’s energy industry, which included €1.7 billion ($1.98 billion) in funding to build the world’s first commercial nuclear fusion reactor. This ambition comes as a surprise, as Germany has long been one of the world’s staunchest and most vocal opponents of nuclear (fission) energy. 

But Germany, Europe’s largest economy, needs to be bold if it wants to meet its own decarbonization goals. Sarah Klein, commissioner for fusion research at the Fraunhofer Institute for Laser Technology in Aachen, told DW last October that investing in fusion technology is a "smart long-term strategic bet” that “keeps Germany at the forefront of a global technology race.” She added that in tandem with renewable energy development, nuclear fusion is “crucial for ensuring energy sovereignty after the phaseout of fossil fuels.”

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And now, Germany’s ambitious plan is already coming together. German company Proxima Fusion has signed on to help build the first stellarator fusion power plant in Europe. The firm inked a Memorandum of Understanding with the Free State of Bavaria, RWE, and Max Planck Institute for Plasma Physics (IPP) that lays out a roadmap for achieving commercial fusion as soon as possible. When the stellarator becomes operational in the coming decade, Proxima Fusion has stated that it will be the first stellarator to demonstrate net energy gain, the most critical breakthrough point for modern fusion models.

Francesco Sciortino, co-founder and CEO of Proxima Fusion, says that the deal “marks the starting point of an industrial ecosystem that consolidates existing and new know-how in Europe and anchors value creation here. This marks the beginning of a long-term industrial growth trajectory over the coming decades, creating new export opportunities for Germany and Europe.”

Not only would this mark a major win for Germany and for Europe in the fusion wars, it would be a win for a new fusion landscape characterized by public-private partnerships. Until recently, nuclear fusion research was such a lofty and expensive undertaking that only deep-pocketed governments could possibly fund prototypes to further research and development in the field. But the race for commercial nuclear fusion has increasingly gone private in recent years as Wall Street gets involved and startups begin to diversify the field. 

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“The potential of fusion technology for the energy supply of the future is enormous. Thanks to an excellent research landscape and the start-ups that have emerged from it, such as Proxima Fusion, Germany can take on a key role,” Dr. Markus Krebber, CEO of RWE, was recently quoted by Interesting Engineering. 

“That is why it is good that the federal and state governments are jointly pushing this topic forward in order to build the world’s first commercial fusion power plant in Germany. We at RWE are happy to support this. Our decommissioning site, with its existing infrastructure combined with our operational expertise, offer ideal conditions to give Germany time and cost advantages in international competition.”

If Germany achieves commercial fusion before any other country, it will be a major upset to what has largely been a race between the United States and China. The two global superpowers have been trading off fusion breakthroughs for years now, and both Donald Trump and Xi Jinping are eager to establish dominance in the sector. But while China and the United States have gotten all the spotlight, Europe’s slow and steady approach may very well win in the end. 

By Haley Zaremba for Oilprice.com