
A £2.5 billion investment in developing nuclear fusion energy technology will be a “cornerstone” of the UK’s industrial strategy, according to the government.
The clean energy industries sector plan comes as part of a wider modern industrial strategy aimed at increasing UK manufacturing associated with the energy transition.
It comes after the government announced billions in funding for nuclear energy as part of its recent spending review.
Alongside £14.2bn for the Sizewell C reactor and £2.5bn for small modular reactors (SMRs), the government will also spend £2.5bn over five years to develop fusion energy.
Nuclear fusion energy
While traditional nuclear plants use fission processes to produce energy, nuclear fusion involves combining atomic elements together – rather than splitting them.
Some of the benefits of fusion include higher energy output, reduced radioactive waste and more abundant fuel supplies.
However, the industry has long failed to solve the numerous scientific and engineering challenges involved with fusion energy, leading to scepticism over its role in combating climate change.
But the UK government is aiming to deliver a prototype fusion power plant by 2040 as part of the STEP (Spherical Tokamak for Energy Production) programme.
First developed in the Soviet Union in the 1960s, a tokamak is a research device that uses powerful external magnetic fields to confine and control the hot plasma of fusion fuels in a ring-shaped container called a ‘torus’.
The plans involve building the prototype plant on the site of a former coal-fired power station in Nottinghamshire, as part of a “fossil to fusion” mission.
The UK government said the programme will create “thousands of jobs” and act as an “anchor for a new industrial ecosystem” in the East Midlands.
During a visit to the UK Fusion Research Campus in Oxfordshire earlier this year, energy secretary Ed Miliband said the UK is “now within grasping distance of unlocking the power of the sun”.
STEP nuclear energy programme
UK Industrial Fusion Solutions Ltd (UKIFS), part of the UK Atomic Energy Authority, will deliver the STEP programme, which the government said will be a “cornerstone of the UK’s clean energy and industrial future”.
UKIFS chief executive Paul Methven said the UK is at the “forefront of global fusion energy research”, with STEP “poised to transform that leadership into commercial reality”.
“By building our prototype fusion power plant in the East Midlands, we’re not only advancing clean energy but also creating high-quality jobs, driving innovation, and delivering economic growth both regionally and nationally,” Methven said.
Maintaining technological leadership in fusion “demands ambition” Methven said, while the inclusion of STEP in the industrial strategy “shows that government is rising to that challenge”.
“We’re ready to turn this bold vision into action and ensure the UK leads the way in this exciting sector,” he said.
Funding for the STEP programme comes after the government announced a partnership with Italian firm Eni and a group of Japanese companies in March focused on commercialising fusion energy technology.
Meanwhile, in December the UK government announced a £40.5m investment in a joint fusion research project with the US involving UK-based Tokamak Energy.
The government said fusion research is already delivering spillover benefits in AI, robotics and advanced materials.
Clean energy industrial strategy
The government also announced an additional £700m in funding for publicly owned GB Energy as it unveiled its industrial strategy.
The funding will go towards building manufacturing facilities to support areas such as floating offshore platforms, electric cables and hydrogen infrastructure.
GB Energy chief executive Dan McGrail said the company will invest in “homegrown supply chains” to ensure key infrastructure is made in Britain.
“We are working closely with businesses across the clean energy sector to invest in areas of strategic need and will get funding out as fast as possible to get new projects off the ground,” McGrail said.
The £700m boost to GB Energy’s budget builds on a previous announcement of £300m in funding for the UK offshore wind supply chain announced in April.
Unions welcomed the government’s focus on nuclear energy alongside renewable energy sectors such as offshore wind.
Trades Union Congress general secretary Paul Nowak said the plan shows a “clear commitment to creating high-quality, secure jobs – not just any jobs”.
“The explicit pledge to a new generation of good industrial jobs will strike a chord with workers from Teesside to Merseyside, many of whom felt left abandoned by the last government’s failure to act,” Nowak said.
“By prioritising sectors like nuclear fusion, nuclear fission and offshore wind, the government is showing a serious commitment to a balanced, resilient energy mix.”