The German Academy project “ESYS” examined the role of fusion power plants within the overall cost structure of a future energy system. The study found that fusion would only be economically viable if the total system cost—including generation, storage, grid, and consumption infrastructure—fell below a threshold of roughly €10 000 per kilowatt of net electric capacity. Current estimates of the levelised cost of electricity (LCOE) for future fusion plants range from $40 to $165 per megawatt‑hour, which translates to about €38 to €157 per megawatt‑hour. These figures are based on a variety of reactor concepts, but the lower end of the band is considered unlikely because fusion is a brand‑new technology that will initially operate as a single, large plant with limited operational experience. Consequently, early LCOE values are expected to lie in the upper part of the range.
Fusion plants are projected to operate as baseload units, similar to today’s coal or nuclear plants, because their high capital costs must be amortised over many full‑load hours. The primary operating cost is the fuel, which is negligible compared with the capital and maintenance expenses. In addition to electricity generation, fusion could provide process heat for seawater desalination, direct air capture of CO₂, and electrolysis for hydrogen production, all of which benefit from the high temperatures achievable in a fusion reactor.
On the technical front, the Lawson criterion—requiring a product of plasma density, temperature, and confinement time—has been met in a laser‑driven experiment at the National Ignition Facility in 2021. That experiment used an indirect‑drive approach to heat and compress a deuterium‑tritium “hot spot” to ignition conditions. Magnetically confined fusion, however, has yet to reach the Lawson threshold. The ITER project, scheduled to achieve first plasma ignition in 2034 and begin deuterium‑tritium operation in 2039, will not achieve a net positive energy balance because its size is insufficient for that purpose. The next step, the DEMO demonstrator, is planned to incorporate all components of a commercial plant, including a closed tritium fuel cycle, and is expected to deliver the first net‑positive fusion power.
The ESYS report also highlights that fusion’s economic prospects will be shaped by the evolution of competing low‑carbon technologies such as photovoltaics and battery storage. Rapid cost reductions in these sectors could raise the bar for fusion’s cost threshold. Geopolitical factors, such as the sharing of fusion knowledge and the stability of international supply chains for tritium and other materials, will also influence the cost trajectory.
The project brought together a consortium of German research institutions and industry partners, including experts from the Max Planck Institute, Fraunhofer Institutes, and the German Aerospace Center. Key contributors such as Andreas Löschel, Ellen Matthies, Karen Pittel, Jürgen Renn, Dirk Uwe Sauer, and Indra Spiecker coordinated the scientific analysis, while the project was funded by the German Academy of Sciences and supported by national research grants. The collaboration spanned several years, with the latest comprehensive assessment published in 2023, providing a benchmark for policymakers and industry stakeholders as they evaluate fusion’s place in a climate‑neutral energy mix.