Commonwealth Fusion Systems just locked in its second billion-dollar power deal, this time with Italian energy giant Eni. The agreement for electricity from CFS's future Arc reactor marks a crucial step toward establishing commercial fusion power pricing and demonstrates growing corporate confidence in the technology that could revolutionize clean energy.
The fusion energy sector just got its biggest validation yet. Commonwealth Fusion Systems has inked a power purchase agreement worth more than $1 billion with Italian energy giant Eni, marking the second major commercial deal for electricity that doesn't exist yet.
The agreement covers power from CFS's Arc reactor, a 400-megawatt fusion plant planned for Richmond, Virginia, in the early 2030s. It's the second such deal for the Cambridge-based startup - Google already committed to buying half of Arc's output in a deal announced this June.
"One of the reasons we built Sparc is so that we could actually get the experience of what it's like to build a nearly full-scale system," CEO Bob Mumgaard told reporters last week, according to TechCrunch. "Arc will be the first of many that's backed by a supply chain that is primed for scale."
The timing couldn't be better for CFS. The company's demonstration reactor Sparc, currently 65% complete in Devens, Massachusetts, is on track to fire up in late 2026. That milestone will determine whether the company's tokamak design - using D-shaped superconducting magnets to confine superheated plasma - can actually generate more energy than it consumes.
But here's where things get interesting. Eni, one of the world's largest oil and gas companies, doesn't have U.S. operations that would consume gigawatts of electricity. "The power will be sent to the grid at the end of the day," Lorenzo Fiorillo, Eni's director of technology, R&D, and digital, confirmed to reporters.
In other words, Eni plans to resell the power - likely at a loss, given that first-generation fusion electricity will be expensive. So why would an energy giant sign up to potentially lose money on power trading?
The answer reveals the deal's real purpose: establishing fusion power pricing and unlocking project financing. Mumgaard admitted as much, explaining that the power purchase agreement "gives us the certainty of where the power is going to go, what the price is going to be, etc. And that allows us to then take that package to more financial investors in project finance and other areas."
This strategy makes sense given CFS's funding situation. The company has raised nearly $3 billion to date, including an backed by , , Breakthrough Energy Ventures, and notably, itself. Completing Sparc will likely exhaust a significant portion of those funds.