The Growing Role of State Governments in Funding Fusion Development
A lot has been written lately about the pullback of U.S. federal government funding of science research under the Trump Administration. Examples of this include large cuts at the NIH (37% funding cut), the NSF (cut by more than 50%), NASA (cut of its science budget by 53%), the EPA (55% budget cut), and NOAA (25% budget cut). As most of you are aware, the U.S. Department of Energy (DoE) has also been targeted for significant budget cuts. This includes budget cuts at the DoE Office of Science (14% cut to $7.1 billion) and even bigger cuts at the Advanced Research Projects Agency – Energy (ARPA-E) of 57%.
Which begs the question: “If the Federal Government isn’t funding fusion, is anyone else in government stepping up to the task?” The obvious place to look is at state governments. Of the states, several have made significant investments in the development of fusion energy, the fusion supply chain, and infrastructure to support fusion energy: Massachusetts, California, Washington, New York, and Virginia. Each is taking a unique approach to how they go about enabling the development of fusion energy; let’s look at specifically how each of these states is approaching this.
Massachusetts – Home of MIT and CFS
Massachusetts is certainly one of the leaders in private and public fusion, being the home of the Massachusetts Institute of Technology (MIT) and Commonwealth Fusion Systems (CFS). In 2024, the state passed the “Mass Leads Act”, which focuses on investment in clean energy sources. The bill provides $1.3 billion in funding for clear energy sources. While a large amount of this funding is for wind power, much of it can also be applied to other clean energy sources such as fusion energy. The Mass Leads Act is expected to drive over $16.4 billion in economic activity in the state.
California – The Sunshine State (Literally)
California can rightly claim to be one of the homes of U.S. fusion energy. With facilities like the Lawrence Livermore National Laboratory (LLNL) National Ignition Facility (NIF), the General Atomics DIII-D National Fusion Facility, and the University of California-San Diego (UCSD) Fusion Engineering Institute, the state is a leader in fusion research. Additionally, California is home to a number of fusion energy companies, including TAE, Pacific Fusion, and Focused Energy. California recently introduced Senate Bill 80 (SB-80), which when passed would provide funding to establish multiple Fusion Research and Development Innovation Hubs in California. In a state where 20,000 people are already employed in the fusion energy sector, the $100 million in annual funding provided by SB-80 would help continue California’s lead in fusion energy development.
Washington – The West Coast Nexus for Fusion Energy
Like California, the state of Washington has a deep fusion energy history. The state (and especially the Seattle area) is home to a number of fusion energy companies, including Helion Energy, Zap Energy, and Avalanche Energy, all benefiting from the materials expertise in Seattle’s massive aerospace industry. Washington’s approach tends to focus on enabling fusion energy companies, such as simplifying the permitting process for these companies.
New York State
While New York State may not have quite the number of fusion companies or research institutes as California, Massachusetts, or the state of Washington, it has a long history with fusion and alternative energy initiatives. This includes the University of Rochester, which has been a pioneer in lasers and is home to one of the three Inertial Fusion Energy hubs. New York State’s Energy Research and Development Authority (NYSERDA) has also invested $22 million to modernize the power grid in New York, and is starting an initiative to develop fusion supply chain companies in the state.
Virginia – Home of the First Commercially-Operated Fusion Power Plant?
Like Washington State, Virginia’s primary focus is on simplifying the regulatory regimes and offering financial incentives to fusion companies that come to the state. For instance, the Virginia Clean Energy Innovation Bank and Chesterfield County, Virginia have each provided $1M to help CFS build the first commercial fusion power plant (The CFS ARC plant) on a Dominion Energy-owned site in Chesterfield County. The state has also simplified the regulatory environment for fusion energy deployment by expanding the state’s definition of “clean energy” to specifically include fusion energy. Given the appetite for electricity from Virginia’s data centers (thought to be more than 25% of the state’s total electricity consumption), getting a new energy source online like fusion energy cannot come too soon.
Summary: States are Playing a Key Role in Fusion and its Supply Chain
As we have stated in a few recent articles, fusion energy is expected to be a critical supplier of electricity for the world’s push to the electrification of a number of sectors, including residential, transportation, data centers, and industrial uses. It is also a potential source of heat energy for uses such as industrial processes (metals, chemical, and others). The needs for these resources vary significantly from state to state; and the level of investments from various states should be proportional to those needs, as well as the desire of the public utilities in those states to put time, money, and human energy into those areas. Given that, it is certainly in the best interests of the state to be involved in helping fusion come to fruition.
