U.S. fusion startup Helion Energy raised $465 million in new investment, valuing the company at $15.5 billion. The company plans to use the funds to accelerate construction of its first commercial power plant and aims to supply fusion power to the grid as early as 2028.

TechCrunch reported on June 4 that Helion recently raised $465 million in a Series G funding round. The money will be used for the Orion project, its first fusion power plant planned for construction in Washington state.

The round was led by Thrive Capital. New investors included Alta Park Capital, Anti Fund, BoxGroup, Lux Capital, Peak XV Partners and Ford Motor executive chairman Bill Ford, among others. Existing investors including SoftBank Vision Fund 2, Lightspeed Venture Partners and Mithril Capital also participated. Helion raised $425 million in January last year, and the latest round brings total funding to about $1.5 billion.

The industry is watching the deal because of Helion's power supply contract with Microsoft. The two companies signed an agreement under which Helion will supply fusion power it produces to Microsoft's data centres, and Helion has set a goal of delivering by 2028. That is seen as an aggressive timetable compared with other fusion companies, which largely project commercialisation from the mid-2030s.

Helion is also seeking to differentiate itself in its technical approach. Most fusion companies are researching ways to generate electricity by converting heat from ultra-hot plasma into steam turbines.

Helion, by contrast, is developing a method to recover electricity directly by using the force of expanding plasma during the fusion reaction pushing against a magnetic field. The company says this can raise generation efficiency and simplify plant design.

The technology has not yet been sufficiently validated, critics say. Some fusion researchers say Helion has released relatively few peer-reviewed academic papers, making it difficult for outsiders to assess the technology's feasibility. Helion Chief Executive David Kirtley said last year, "I want to actually make fusion happen rather than just talk about it as theory," emphasising an approach focused on demonstration.

The funding also aligns with a recent influx of large-scale capital into the fusion sector. Focused Energy recently announced a $240 million raise, and Thea Energy announced a $100 million investment. In February, Inerzia Energy went public with a $450 million Series A round, and Type One Energy is also reported to be pursuing a $250 million Series B raise.

Fusion is a technology that generates energy using the same principle as the sun and is viewed as a next-generation energy source because it can produce virtually near-infinite power using hydrogen isotopes as fuel. Interest from big tech companies is also rising as data centre power demand surges with the spread of artificial intelligence.

Even so, it is widely seen as a field that will take a long time to commercialise. Several companies recently said they reached milestones on the path to commercial power plants, but most see the first commercial-scale plant coming at the earliest in the middle of the next decade. Against that backdrop, Helion is effectively presenting a faster timetable of 2028.

Experts say technical hurdles remain before fusion is commercialised, but investment interest is likely to continue for some time as rising power demand coincides with pressure for carbon neutrality. Helion's latest raise is seen as an example showing fusion remains a long-term challenge while being viewed as a key contender in future energy markets.