The UK government is transforming its national fusion developer into a commercial entity to attract private investment, marking a major shift in approach to the unproven energy technology. UK Industrial Fusion Solutions will be renamed UK Fusion Energy and restructured to operate as a commercially oriented entity under a new national fusion strategy.

The £1.3bn government-backed venture aims to develop first-of-a-kind fusion power plants and stimulate the UK supply chain. The Step project, currently a subsidiary of the UK Atomic Energy Authority, plans to deliver electricity to the grid by 2040 from a site in Nottinghamshire. A government tender suggests the project could cost up to £20bn.

This commercial pivot comes as global fusion competition intensifies. US fusion start-ups raised $1.6bn in private funding last year, while China has invested between $6.5bn and $10bn in fusion research since 2022. The UK's move signals growing confidence that fusion could eventually provide abundant clean energy, despite sceptics arguing commercial viability remains decades away.