The Golden State continues to position itself as the nation’s leader in fusion energy research and development, backed by new state funding, recent legislation and a study highlighting the sector’s growing economic potential.
A recent report by the San Diego Regional Economic Development Corporation identifies California as home to more than one-third of all U.S.-based fusion companies. According to the study, the state has attracted more than $2.2 billion in cumulative public and private investment in fusion energy since tracking began in 2021. The report estimates the industry could generate between $48 billion and $125 billion in economic impact, depending on scientific advancements and successful commercialization of projects.
Governor Gavin Newsom said California’s collaborative research environment is central to its leadership in the emerging field.
“California’s fusion ecosystem can revolutionize the clean energy sector through deep collaboration between our universities, national laboratories, industry partners and state leaders,” Newsom said. “By advancing breakthrough technologies and fostering an industry-leading workforce, we are shaping the future of clean energy and demonstrating once again that California leads the world in innovation.”
Fusion energy has been designated a “bet” sector under the California Jobs First Economic Blueprint, signaling its potential as a long-term economic driver. The sector currently supports an estimated 4,700 jobs statewide and generates approximately $1.4 billion in annual economic output.
Last month, state and industry leaders convened for California’s first statewide fusion energy meeting. The event was hosted by General Atomics, Lawrence Livermore National Laboratory and the University of California San Diego, in collaboration with the University of California Office of the President, the California Energy Commission and the Governor’s Office of Business and Economic Development. The convening highlighted new legislation, state programs and regional hubs supporting fusion innovation.
During the meeting, the University of California announced $8 million in grants awarded to UC laboratories to accelerate fusion research.
In November, Newsom signed Senate Bill 80, authored by Sen. Anna Caballero, D-Merced, to expand fusion research and development in the state. The bill created the Fusion Research and Development Innovation Initiative and includes $5 million to support new fusion technologies and help advance project commercialization.
California is home to two of the nation’s premier fusion research facilities. The DIII-D National Fusion Facility in San Diego is the country’s largest magnetic-confinement, or tokamak, user facility. Lawrence Livermore National Laboratory houses the world’s most energetic laser for inertial-confinement fusion, where researchers achieved the first laboratory fusion ignition in December 2022 – a milestone widely viewed as a critical step toward fusion viability.
State officials note that fusion energy could complement California’s existing clean energy portfolio. In 2023, California generated roughly two-thirds of its electricity from clean sources, making it the largest economy in the world to reach that level. The state has also operated on 100 percent clean electricity for part of the day on most days this year.
Fusion, which powers the sun, is widely described as a potential source of carbon-free and virtually limitless electricity. Supporters say it could help California meet its climate goals, strengthen U.S. energy security and expand access to clean energy worldwide as the technology matures.
State leaders also emphasized California’s broader economic role, noting its position as one of the world’s largest economies and a national leader in new business formation, venture capital investment, manufacturing and agriculture.
