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The nuclear fusion community ended 2022 with a bang, when scientists at the Lawrence Livermore National Laboratory in California reported that they had created a reaction that produced more energy than it consumed. This breakthrough, known as a fusion ignition, was hailed as a historic advance, a critical step on the road to generating limitless clean energy by replicating the reactions that power the sun. Following the announcement, commentators immediately began to speculate about how close scientists are to achieving that long-held dream. But any claims about the start of the next clean energy revolution must be regarded skeptically.
In part, this is because when the energy-intensive lasers that produced the reaction are also accounted for, the total energy used in the experiment was much more than it created. Additionally, to turn this kind of fusion reaction into an actual power source, the same effect would have to be replicated at a much higher frequency—more like several times a second rather than once a day. The reality is that fusion energy is nowhere near ready for commercial use. Nor will it be, until a successful innovation strategy for nuclear fusion is devised.
That a scientific breakthrough of this size was made by a state-funded laboratory is nothing new—most energy advances in the last decade have been. This is because the energy sector is reliant on public funding. Since technological advances in electricity generation are capital intensive, risky, and hard to patent, the private sector often shies away from investing in research early on. Nuclear fusion has suffered from this lack of investment, leaving governments as its biggest backers.
For state funding to succeed, however, governments must consider how they shape markets, as well as fix them. The history of capitalism shows that governments have often created markets by investing in the development of new technologies. In this way, governments have created and shaped energy markets for decades.
Importantly, for governments to successfully support research and development, a decentralized network of public research hubs—not one centralized entity—is needed. Decentralization increases the chances of researchers making unexpected discoveries through serendipity, as well as competition. A decentralized network has to be supported by the right kinds of financing. Science needs patient, long-term backing, not the short-term, rapid-results-oriented investment that comes from venture capitalists. Finally, government agencies need to commit to making their work transparent to clearly show what they are trying to accomplish and the institutional environment in which innovations are made. If current far-reaching problems of finance, transparency, and direction continue, fusion’s future may not be as bright as the headlines have predicted.
Research into nuclear fusion was not always dominated by the United States and its Western allies. In the late 1970s, the International Atomic Energy Agency (IAEA) promoted coordinated research by many countries, focusing not only on fusion reactor technology but also on its potential environmental impact and possible safety questions. A global network of publicly funded labs flourished on both sides of the Iron Curtain. For some time, the Soviet Union had the largest number of scientists, engineers, and technicians. Both sides made progress.
By 1989, however, this system began to break down. When the Soviet Union collapsed, there was a massive brain drain from Eastern-bloc countries. Those who had formerly worked on fusion now abandoned not only Eastern Europe but also their professions. Many began careers in business and finance, with some even going to Wall Street. Fifteen years after the Iron Curtain fell, less than 50 percent of the IAEA network’s original research capacity was left. Eastern Europe had ceased to be a central financial and intellectual driving force behind the pursuit of nuclear fusion.
At the same time, most of the remaining international financial resources available for nuclear fusion were redirected toward one big project: the International Thermonuclear Experimental Reactor in southern France. The reactor’s origins can be traced to a meeting between U.S. President Ronald Reagan and Soviet President Mikhail Gorbachev in 1985. Although the initial proposal was largely symbolic, intended to signify political peace through scientific collaboration, it came at a moment when the decentralized network of cooperating facilities was coming to an end. The aim of ITER was to demonstrate the feasibility of nuclear fusion and international cooperation through one joint venture.
Today, ITER—which has been under construction since 2013 but is not yet completed—has been criticized for its questionable scientific feasibility. Above all, it is uncertain whether there is a sufficient global supply of the hydrogen tritium that is needed for a successful fusion reaction. Although the extremely rare isotope can be generated through specific heavy-water reactors, the few that exist are reaching the end of their working days, placing the long-term viability of the project in doubt. ITER has also been criticized for its immensely high costs, which the U.S. Department of Energy has estimated may reach $65 billion. ITER runs the risk of wasting that huge investment—notwithstanding early warnings that it was unlikely to achieve any usable results.
In their pursuit of quick success, venture capital firms are not willing to accept that this invention will take many decades, not one.
Science advances best through serendipity—a process whereby the search for one thing leads to the discovery of something else. If there is only one lab doing advanced work in a given field, then the chances for such discoveries naturally diminish. For this reason, decentralized networks of government, business, and research hubs are necessary to advance goal-oriented, productive research. Promoting a clean energy revolution requires a variety of proactive and bold organizations, pushing new and exciting innovations both separately and together.
ITER is an oversized and inefficient government-funded entity. It is complemented, on the other extreme, by a misdirected and chaotic array of private-sector projects, which are funded by venture capital without direction. Venture capitalists have been swarming around a new wave of startups that claim they can develop nuclear fusion within the next decade—a timeline that many experts have repeatedly called unrealistic. Yet notwithstanding fusion’s inability to solve the climate crisis anytime soon, billions of dollars of venture capital have been raised. This short-term private investing is pursuing a different goal from long-term state financing. The result is that disintegrated private funding will not succeed in advancing nuclear fusion. In their pursuit of quick success, venture capital firms are not willing to accept that this invention will take many decades, not one. Much of the money will, therefore, be squandered.
To work toward the common goal of clean energy, a coordinated and decentralized network of research hubs is needed. This will require the building of long-term relationships between them. Past examples of public investment in advanced science have shown how an Entrepreneurial State successfully enables multiple actors to carry out risky research. Personal computing, for example, was driven by decentralized industrial policy, which provided public funding to different companies, researchers, and firms with results that were felt by consumers worldwide.
Government agencies play a crucial role in connecting different parts of decentralized R & D networks. For technological advances to have real-world applications, governments must assist firms in making their products commercially viable; this relationship must go well beyond funding research. At the same time, governments must be hardheaded. If a project is not advancing, then it must be stopped and resources reallocated to more promising projects.
ITER is far from its goal of generating carbon-free energy and played no part in the recent breakthrough in California. Indeed, the facility that created the fusion ignition was Lawrence Livermore’s National Ignition Facility. Clean energy is not the objective of Livermore. The laboratory’s central function, rather, is to study nuclear weapons and improve their destructive effects. Despite the claims of the Department of Energy, the private purpose and the public explanation of this research remain at odds. This research was conducted primarily for its application to nuclear weaponry.
Governments can act in the public interest especially if the intended goal of public research entities is clear. Of course, setting one particular goal can lead to the discovery of something else. Indeed, with unexpected discoveries there is often not an explicit intention in place to begin with – how could there be? Nevertheless, the institutional context behind research and scientific advancement matters. As recent debates over biased artificial intelligence have shown, new technologies, if not carefully controlled, can stray into unwanted territory. The better the information that is available to voters and policymakers from publicly funded processes, the more effective the resulting policy choices. As competing priorities are an inevitable part of modern economies, transparent funding is a critical element of accountable governance. This is critical for promoting public-interest-driven financing.
To get this right, Entrepreneurial States must nurture a varied network of research hubs. These must have the innovative capacity to pursue the desired goals in different ways and create new ways for research progress to be assessed by the public and for scientific advances to be transparently disseminated. To successfully accomplish these tasks, the public sector must take ownership and be accountable for the work it does. Making real-time data publicly available—including the use of taxpayer money to fund the work in question—can promote transparency, acknowledge achievement, and motivate progress. It can also be helpful to set intermediate benchmarks, so that an agency can decide when to stop funding failing projects.
New forms of collaboration must be nurtured in a more coordinated way to reshape the landscape of nuclear fusion research.
Ultimately, governments’ task is neither to pick winners nor to give unconditional handouts, subsidies, and guarantees but to create a distributed network of “willing” players. Because of the nature of the energy market, these players are likely to be those leading government projects, a network of which should span public-sector research groups, university laboratories, and private businesses. Ideally, governments and the private sector should work to reestablish a decentralized network of ambitious actors advancing nuclear fusion. In such a network, routine evaluations would feed into up-to-date assessments of where scientific progress is headed. Considering ITER’s huge cost overrun and the fact that it will not help solve climate change, there needs to be an honest and transparent conversation about how public financing could be directed toward more promising outcomes. This must include consideration of the connection between the objective and the institutional form that the investment takes. Focusing on only one project will not work. Instead, new forms of collaboration must be nurtured in a more coordinated way to reshape the landscape of nuclear fusion research.
Outcome-oriented scientific research needs to be about making markets, not just fixing them. It is about imagining new areas of exploration, not about creating siloed projects that absorb all available funding. A true breakthrough in usable nuclear fusion is unlikely to happen at Livermore or ITER. Rather, it will result from some farsighted collaboration between government research institutions and ambitious private-sector enterprises in which the government can play a crucial coordinating role.
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