Proxima Fusion, a Munich-based startup, announced plans to build a demonstration stellarator in Germany after securing €400m in non-dilutive financing from the Bavarian government. The project, part of Europe's strategic push for energy sovereignty, will cost €2bn with private investors covering an additional €400m.

Global fusion investment surged nearly 500% to $3.8bn in 2025 as Europe positions itself against US and Chinese competitors. European startups like Marvel Fusion (€385m) and Tokamak Energy ($335m) leverage Europe's strength in high-complexity precision manufacturing, a critical advantage in this complex technological race.

Europe's fusion sector benefits from deep research expertise and specialized supply chains developed through ITER and CERN, giving the region an edge despite formidable US competitors like Commonwealth Fusion Systems, which has attracted nearly $3bn in funding. The convergence of technological advances in superconducting materials and AI modeling has finally made fusion viable.