Oil major Eni bets on nuclear fusion becoming its ‘next refinery’
Italian group widening investments in technology that promises much but is yet to be commercially proven
Italian oil major Eni is widening its bet on nuclear fusion, arguing the technology could become its “next refinery” and aiming to be among the first energy companies to commercialise fusion in Europe.
Francesca Ferrazza, head of magnetic fusion initiatives at Eni, told the FT that “competition is growing” in the fusion industry, after the technology and expectations had changed significantly in the past five to six years. “It was always considered research. Now we are considering it as an industry.”
Ferrazza said Eni aimed to open a commercial fusion plant in Europe by the early 2040s or even sooner.
The plant would be developed by US start-up Commonwealth Fusion Systems (CFS), in which Eni is an investor. CFS has raised about $3bn to date and aims to bring its first commercial plant online in the US by the early 2030s.
Ferrazza said that successfully starting the US plant would “open a number of other opportunities” for CFS, with Eni hoping to open a second plant in Europe.
Her comments came as major energy companies, including Shell, Chevron and Germany’s RWE, enter the race for fusion, placing early bets on what some call the “holy grail” of energy, with the technology holding out the promise of abundant, low-carbon electricity.
Fusion aims to generate electricity by recreating the nuclear reaction that powers the sun, fusing atomic nuclei in a superheated plasma. It is far more difficult than splitting atoms, the process known as fission that powers conventional nuclear plants.
While laboratory experiments have demonstrated potential, no company has yet proved that the technology can be turned into a commercial power plant.
Eni has been especially interested in the process of extracting and purifying the used fusion fuel to be injected back into the reactor, the so-called fuel cycle. The company has recently formed a joint venture with the UK Atomic Energy Authority, the UK’s national fusion laboratory, to provide consulting services for the process.
The process involves recovering unburned fuel from the fusion reactor and separating tritium and deuterium — the hydrogen isotopes commonly used as fusion fuel — so they can be purified and reused. Eni thinks its decades of experience handling hydrogen and processing hydrocarbons could give it an engineering advantage in developing the technology.
The fusion fuel was “the next refinery point for us, [and] for the world. And why not have it in our basket?” said Ferrazza.
Eni’s strategy reflects growing interest among energy and utility companies in fusion after an initial wave of investment led by big technology groups seeking clean energy for artificial intelligence data centres.
Chevron and Shell have invested in US fusion group Zap Energy, while the Tennessee Valley Authority, a federally owned utilities operator, has backed Type One Energy.
Eni’s core vehicle for its fusion ambition is a collaboration with CFS, which is one of the best-funded fusion companies, with Eni already agreeing to buy electricity from CFS’s first US plant under a power purchase agreement valued at about $1bn.
Ferrazza said that forming the right partnerships, and potentially winning government support, had become essential because the competition was heating up. Fusion companies would probably need “billions” of dollars to put their commercial power plants on the grid, she added. “It’s too big a game to fail.”
However, Chris Gadomski of BloombergNEF said recent investments by tech giants such as Google in both fusion and fission companies suggested that even some of the sector’s most experienced backers were not yet confident of success.
They were “spreading their bets”, he said, reflecting a view that “we’re not sure which one of these will happen, so we’re going to cover a variety of them.”
“There’s a history in the nuclear industry of misrepresentation or underestimating how long it’s going to take to build and how much it’s going to cost,” Gadomski said. “And that’s a very significant challenge that has to be overcome.”