BOC International: Commercialized Controlled Fusion is Gradually Approaching, Industry Chain Expected to Benefit Fully

Bank of China International released a research report stating that controlled nuclear fusion has long been seen as the ultimate solution to the human energy crisis, but it has been considered unattainable due to the high difficulty in achieving the technology. With breakthroughs in high-temperature superconducting materials, artificial intelligence, and other technologies, controlled nuclear fusion is gradually moving towards commercialization, with commercialization getting closer and the industrial chain expected to enter a period of rapid development. As technology continues to advance, controlled nuclear fusion commercialization is gradually getting closer, and the industrial chain is expected to enter a period of rapid development, benefiting fully, and it is recommended to pay attention to listed companies that possess the manufacturing capability of core components for tokamak devices and have obtained relevant orders. Bank of China International's main points are as follows: Nuclear fusion is seen as the ideal ultimate energy source, with tokamak devices having the most commercial potential. Nuclear fusion is the process of combining several lighter atomic nuclei into a heavier one, converting mass into energy. Due to the relatively low difficulty in achieving the deuterium-tritium reaction, it has become the most common choice for fusion fuel. Nuclear fusion, with its outstanding advantages of abundant fuel resources, high energy density, cleanliness, pollution-free, and high safety, is seen as the ideal ultimate energy source for humanity. Currently, magnetic confinement fusion has a long confinement time, high technological maturity, and strong engineering feasibility, making it the most effective way to achieve fusion energy development, with tokamak devices being the most mature and likely to be the first to achieve commercialization. According to statistics from the IAEA, as of 2024, there are a total of 159 fusion projects worldwide, with 79 tokamak devices, accounting for close to 50%. Currently in the engineering feasibility verification stage, China is at the forefront of controlled nuclear fusion research internationally. In the 1990s, the scientific feasibility of controlled nuclear fusion was already proven by tokamak devices. Currently in the engineering feasibility verification stage, the largest tokamak device in the world, ITER, jointly constructed by 35 countries including the United States, China, and Europe, aims to solve various engineering problems before the commercialization of controlled nuclear fusion investments. Fusion research in China began in the 1950s and has been synchronized with international efforts. Through years of continuous investment and unremitting efforts, China has built devices such as EAST and HL-2M, achieving a series of important achievements, and China's controlled nuclear fusion research is at a very advanced level internationally. Breakthroughs in new technologies such as high-temperature superconductors and artificial intelligence are accelerating the commercialization of controlled nuclear fusion. With the maturity of high-temperature superconducting technology in recent years, significant improvements in fusion device performance have continued to reduce costs. Coupled with AI's unexpected development to improve fusion device design and control efficiency, the expected commercialization of controlled nuclear fusion is accelerating, driving more universities, research institutions, and private capital into the field. According to statistics from the Fusion Industry Association (FIA), as of mid-2024, global private fusion companies have received a total investment of USD 7.12 billion, an increase of USD 0.9 billion year-on-year, with capital market financing reaching new highs, with over 45 companies participating and the number of companies rapidly increasing. In another FIA statistic, over 70% of commercial fusion companies believe they will achieve grid-connected power supply by 2035, and over 50% believe they will meet the low cost/high efficiency conditions for commercial operation by 2035. Controlled nuclear fusion is expected to bring a huge market, and the industry chain is likely to benefit fully. Fusion projects require large investments, and the cost of fusion power plants is high. According to tests by researchers at Princeton University, the cost of a 1000MW fusion power plant is between USD 2.7 billion and USD 9.7 billion. If fusion is fully commercialized, according to estimates from IgnitionResearch, it will become at least a USD 1 trillion market by 2050, with a huge potential market size for controlled nuclear fusion. Currently, the industrial chain of controlled nuclear fusion mainly revolves around tokamak devices, and in the future, with the advancement of the commercialization process of controlled nuclear fusion, the industrial chain may enter a period of rapid development and benefit fully. Main risks Risks of technological progress falling short of expectations; risks of technological route replacement; risks of insufficient investment; risks of industry policies falling short of expectations; risks of project progress falling short of expectations.