Commonwealth Fusion Systems is counting on magnets for near-term revenue

Commonwealth Fusion Systems said Thursday it will sell high-temperature superconducting magnets to Realta Fusion, the second in a series of deals that signal the company will rely heavily on its magnet technology in the coming years to generate much-needed revenue.

“It is the largest deal of this type to date for CFS,” Rick Needham, the company’s chief commercial officer, told reporters by phone.

Commonwealth Fusion Systems, or CFS, previously sold magnets to the WHAM experiment at the University of Wisconsin, with which fusion startup Realta is collaborating closely. The physics behind WHAM underpins Realta’s approach to fusion energy, which is known as a magnetic mirror reactor.

In a magnetic mirror, the plasma is confined to a shape that resembles two two-liter soda bottles joined at the base. At each end, powerful magnets strike the plasma and force it back toward the center. Weaker magnets surround the middle of the bottle shape.

To make a more powerful reactor, Khosla-backed Realta would only need to enlarge the middle section, and because those magnets are less powerful, they are cheaper. It is assumed that kilowatt-hour costs will decrease as the size of Rialta’s reactors increases.

CFS is pursuing another form of magnetic confinement fusion called a tokamak. In a tokamak, D-shaped magnets emit strong fields to keep the plasma rotating in a donut-like shape inside. Over the years, the company has improved its magnets in an effort to put electrons on the grid from Arc, its future commercial reactor scheduled to be built in Virginia.

The existence of both CFS and Realta stems from the same magnet. CFS was founded in 2018 after scientists at MIT realized that a new class of commercially available high-temperature superconductors could support the design of a viable tokamak. Realta was founded a few years later when physicists at the University of Wisconsin “saw that there was a new, game-changing technology that would enable us to get back into the world.” [magnetic] “We reflect and leverage the engineering advantages of this concept,” said Kieran Furlong, co-founder and CEO.

In addition to the Realta and WHAM deals, CFS also licensed its high-temperature superconducting magnet technology to Type One Fusion, which is working on a third type of reactor design known as a stellarator. While the latest deal doesn’t involve CFS building an actual magnet for the company, it could one day do so, Christine Dunn, head of external communications at CFS, told TechCrunch.

These deals will help CFS repay its investments in magnet manufacturing. The startup spent seven years and hundreds of millions of dollars building a factory capable of producing high-temperature superconducting magnets designed to fusion energy specifications. So far, that has been directed toward building Sparc, the company’s experimental reactor, which won’t be operational until later this year.

“With the Sparc project now 70% complete, it was excellent timing to begin supporting Realta with our magnet manufacturing,” Needham said.

As Realta and Type One pursue different reactor designs, it is clear that CFS does not view them as direct competitors at this time. In the market, there is a divergence between Realta and CFS, with the former initially focusing on industrial applications that need large amounts of heat.

To date, CFS has raised nearly $3 billion, a significant portion of all venture funds raised by merger startups. This puts the company in an enviable position, giving it the means to build key facilities such as its magnet factory before competitors can. The startup offers these deals as a service to the broader fusion industry, making available technologies that would otherwise cost multi-million to replicate. This is certainly true, but it also gives her access to more venture capital, even if indirectly.

Update at 1:45 PM ET: CFS’s manufacturing facility is making the HTS magnet, not the bar, and it will not be idle but will make additional magnets for the Sparc. The article also misstated Rick Needham’s role as COO; He is CCO.