China's Nuclear Fusion "Dual Track" Race: First Major Test Coming in 2027

Ask AI · Why does high-temperature superconductivity give private fusion companies the confidence to accelerate by 12 years?

Reporter Wang Yajie

By 2026, China’s fusion industry stands at a critical “starting line”: on one side is the “national team” with a steady engineering path spanning twenty years, and on the other side are private capital pushing for aggressive commercialization within ten years.

Chen Xuru, chief scientist in the fusion field at China National Nuclear Corporation, sketches a roadmap: by the end of 2027, the “China Circulation Three” (CCTR) will see its parameters increased by 2 to 3 times; around 2035, China’s first engineering experimental reactor will be built; around 2045, China’s first commercial demonstration reactor will be completed.

In contrast, private fusion company Xinghuan Energy’s founder Chen Rui envisions a different pace: the NTST device (a negative triangular spherical tokamak experiment device) will break ground in Shanghai in 2026, complete engineering validation by 2028, and a commercial demonstration reactor will be built by 2033.

This milestone is 12 years ahead of the “national team’s” commercial timetable.

Against the backdrop of the “Atomic Energy Law of the People’s Republic of China” officially coming into effect in January 2026 and the rapid formation of the industry chain, a deep game over the “timeline” has already begun.

This is not merely a race of progress but a “collision” of two development models: the “national team” bets on the steady engineering path of low-temperature superconductivity, while private capital vigorously promotes the commercialization route of high-temperature superconductivity. The resource investment, technological beliefs, and market expectations behind these paths differ significantly. By 2027, both inside and outside the industry see it as the first major test to validate their respective logic.

At that point, whether the “national team” can achieve key parameter upgrades, and whether private companies can realize energy gain (Q>1), will be first verified through concrete engineering results, setting the tone for this long-distance race.

Where does the “12-year” gap come from?

Why dare to advance the timetable by 12 years? Chen Rui points to two core variables: technological route and business model.

He told the Economic Observer that the main device of the “national team” is based on low-temperature superconductivity, which is large in size and costly; whereas Xinghuan Energy’s spherical tokamak + high-temperature superconductivity route aims to significantly reduce device costs through magnetic field and structural advantages, ultimately enabling fusion power to compete with thermal power and wind power. Its commercial scenario is not only for power grids but also directly targets the zero-carbon power market for AI data centers.

This positioning has become an important commercialization direction for private fusion companies in 2026. Currently, there are few private enterprises in China focusing on controlled nuclear fusion R&D, mainly including Xinghuan Energy, Energy Singularity, China National Oil & Gas Group (whose fusion business is mainly under “XinAo Technology”), and Nova Fusion. Despite the small number, each has its own technical route and business focus. Both Xinghuan Energy and Energy Singularity use spherical tokamaks combined with high-temperature superconductivity as core technology, and will supply power to AI data centers as one of their key application scenarios.

Nova Fusion, sensing the opportunity, was established in April 2025. Just three months later, it completed a 500 million yuan angel round of financing, with investors including Alibaba, the Zhongguancun Innovation Fund of the Social Security Fund, and others. Nova Fusion adopts a magnetic inertial confinement approach, aiming to achieve energy gain (Q>1) by 2027—that is, output energy exceeds input energy—a critical threshold for moving from scientific experiment to energy application.

In Hebei, XinAo Group has invested a total of 4.5 billion yuan, built the “Xuanlong-50U” device, and in 2025 achieved the world’s first high-confinement discharge of hydrogen-boron plasma. Hydrogen-boron fusion is viewed as a safer, neutron-free technology route, though more difficult, once breakthroughs are achieved, it can bypass tritium fuel regulation issues.

Chen Zhongyong, an expert from the ITER project under the Ministry of Science and Technology, highlights a key comparison: in the first half of 2025, private fusion financing exceeded 11.5 billion yuan, while before 2019, almost no such funding existed. This stark change is a crucial background for understanding the 2026 fusion boom.

A second-tier executive of a central state-owned enterprise commented: “Currently, money is chasing technology, and bets are on technology. But for entrepreneurs, 2026 is the best window—if not now, then when?”

Different regions are also deploying in the fusion industry. In Changzhou, Jinchuang Group, which makes transit equipment, has signed with Huazhong University of Science and Technology to develop plasma disruption prediction systems. In Hefei, Lansi Heavy Equipment and the Energy Research Institute are jointly working on heat exchange technology; additionally, Hefei, leveraging the Chinese Academy of Sciences’ Institute of Plasma Physics and the BEST project, has gathered nearly 60 industry chain companies. Shanghai, with its financial and high-end manufacturing advantages, attracts companies like Energy Singularity and Xinghuan Energy. Chengdu relies on the Southwest Institute of Nuclear Physics and Chemistry of China National Nuclear Corporation for “hard equipment” development.

An industry insider from Energy Singularity said: “No one wants to fall behind.”

The window in 2026 is narrowing, and 2027 will be the moment to reveal the first results. Whether it’s the “national team” launching its engineering demonstration reactor or private companies validating their Q>1 goal, both will mark the first critical watershed in this long-distance race.

“Chain leader” enters to set the framework

While private enterprises accelerate their deployment, a deeper industry restructuring has fully unfolded from 2025 to 2026.

In July 2025, a giant named “China Fusion Energy Co., Ltd.” was established in Shanghai. Its predecessor was China Nuclear Fuel Co., Ltd., founded in 1983. After restructuring, its registered capital soared from 3.53B yuan to 15 billion yuan, with China National Nuclear Corporation holding 50.35%, and the remaining shares held by Kunlun Capital, Shanghai Fusion, the National Green Development Fund, and other central and local state-owned investors.

In the 2026 industry landscape, this company is designated as the “chain leader” of the “national team,” responsible for overall design, technical validation, equipment development, and capital operations of domestic fusion.

An executive from a second-tier state-owned enterprise analyzed: “It’s not here to compete with private companies for market share, but to set the framework.”

According to a compilation of information from multiple companies and institutions involved in fusion industry cooperation since March 2026, China Fusion Energy Co. is integrating the “China Circulation Three” technology achievements from the Southwest Institute of Nuclear Physics and Chemistry, with China National Nuclear Corporation contributing related intellectual property valued at about 3 billion yuan to participate in the fusion energy platform. This platform, led by the Institute of Plasma Physics of the Chinese Academy of Sciences and with a registered capital of 14.5 billion yuan under the “Fusion New Energy” project, will form a dual-center industrial layout in Chengdu and Hefei.

In the future, key components such as high-temperature superconducting magnets, first-wall materials, divertors, and vacuum chambers will be defined by the national team, while private companies will participate as suppliers or through differentiated scene innovations.

Xin Feng, deputy general manager of China National Nuclear Corporation, told the Economic Observer: “We are open to all kinds of capital and enterprises willing to participate in fusion. We hope to establish innovation consortia that regularly release the development trends and future technical needs of fusion technology.”

Currently, this innovation consortium has 44 member units, covering central enterprises, universities, and private companies.

Chen Xuru delineates the commercialization of fusion energy into six stages: principle exploration, scaled experiments, burning experiments, experimental reactors, demonstration reactors, and commercial reactors. Using mature engineering thinking, he has reserved about ten years for these six stages to address systemic issues like “production and supply chain maturity” and “economic affordability.”

Yen Jianwen, chairman of Fusion New Energy, offers a more specific interpretation. He believes China’s “three-step” fusion strategy (established in 2023 with the release of the “Accelerating Commercial Application of Fusion Energy Strategic Action Plan (2022–2035)” in Anhui, with the path: 2022–2030 for experimental reactor validation, 2030 for starting engineering demonstration, and around 2040 for commercial reactor development) is being redefined, showing a “two-step combined with one step” acceleration. The originally planned 2030 demonstration reactor will see all related engineering designs completed this year; the earliest construction could start by late 2026, or at the latest, in 2027.

Two clocks, one 2027

Compared to private capital, state-owned assets follow a “steady” logic.

The second-tier executive of a central SOE said: “State-owned enterprises leverage thirty years of engineering experience, locking in the 2045 commercial target, ensuring no mistakes. Private capital’s logic is ‘fast’—betting that AI and high-temperature superconductivity can bend the technological curve, using ten years of aggressive push to gain a first-mover advantage over thirty years.”

The collision of these two approaches is reshaping the industry ecosystem.

Chen Xuru’s six-stage model measures the gap between ideal and reality. Currently, China’s fusion R&D is in the “burning experiment” stage, but to achieve Q>1, it must overcome world-class challenges like “steady-state operation of burning plasma” and “materials resistant to high-energy neutron bombardment.”

Private and state-owned entities, under the same ultimate goal, are running along two different speed clocks.

An insider from Energy Singularity said: “We’re not afraid of scientific failure—that at least rules out wrong routes. What worries us is the funding gap, the risk that once the ‘national team’ locks into low-temperature superconductivity, policy resources might shift, and our team could be poached by international giants offering high salaries.”

A private enterprise in East China also told the reporter: “If the ‘national team’ clearly bets on low-temperature superconductivity after 2027, then we private companies betting on high-temperature superconductivity might lose domestic policy support, and our decades-long investments could go to waste.”

Yen Jianwen also noted that the performance of existing low-temperature superconducting materials still has room for optimization, but high-temperature superconductivity has become a key breakthrough direction.

Chen Xuru said that if there is significant progress in high-temperature superconducting magnets, it could make fusion reactors more compact and shorten development cycles.

Although China National Nuclear Corporation has identified high-temperature superconductivity as a key technology, the policies supporting high-temperature superconducting applications, demonstration projects, and safety regulations still need time to implement, and capital’s patience is limited.

Large orders and long-term procurement plans from the national team will drive industry development, with upstream superconductor material companies prioritizing core capacity. Some private fusion companies are choosing to develop key components independently to ensure supply chain stability.

Xu Guosheng, deputy director of the Institute of Plasma Physics, Chinese Academy of Sciences, believes that driven by large-scale project construction, the industry chain upstream and downstream has begun initial development, but a complete, mature industry chain has yet to form, and positive economic feedback remains elusive. Even if technical validation succeeds, mass production of fusion reactors at acceptable costs remains an unknown.

Concerns

Under the dual drive of capital and technology, participants in this track are still anxious about core issues like “tritium management” and “fusion reactor siting and classification” legislation.

The “Atomic Energy Law” came into effect in January 2026, explicitly including controlled thermonuclear fusion into the scope of atomic energy research and development, but supporting standards are still being refined. Core issues such as tritium management and reactor siting lack clear legislation.

During the 2026 National Two Sessions, Yen Jianwen proposed strengthening the national coordination of fusion energy, issuing more detailed industry access rules. In the absence of unified global standards, China should take the lead in legislation and standard-setting, proactively laying out the future fusion fuel supply industry chain, and seizing the strategic high ground in fusion.

The Energy Singularity insider worries that if regulatory frameworks tighten suddenly, approval processes for experimental devices could take years, which would be a heavy blow to startups relying on financing.

There is also a talent shortage.

The components and disciplines involved in magnetic confinement controlled fusion reactors are extremely complex, with a significant talent gap. While Lanzhou University and Hefei University of Technology have established schools of fusion science and engineering, talent cultivation takes time.

A headhunter told the reporter: “Recently, a plasma physics PhD’s market value has soared to over a million yuan per year, and major companies are scrambling for talent.”

After checking several recruitment platforms, the Economic Observer found that positions like “Fusion Reactor Physics and Engineering” at Shanghai Yanchao Fusion Technology prioritize PhDs, with salaries ranging from 20k to 50k yuan for 15 months; Energy Singularity’s “Plasma Physics Integrated Simulation Researcher” offers 20k to 40k yuan; a large domestic new energy company’s plasma-related positions pay 30k to 60k yuan.

These anxieties over talent, funding, and regulation have not dampened capital enthusiasm nor halted the race. The Energy Singularity insider believes that precisely because they see this as a critical window from “scientific possibility” to “engineering feasibility,” various capital are willing to bet.

For companies, the anxiety stems from a clear understanding of the uncertainties in technological routes and policies, while the race is driven by the huge expectation that “success will revolutionize the energy landscape.”

Before the first major test in 2027, despite many challenges, capital continues to flow, talent keeps gathering, and the race persists. The Energy Singularity insider concludes: “Staying in the game itself is a victory.”