Fusion Startup Nears Its 'Kitty Hawk Moment' as Wind Projects Stall at the Pentagon

Axios House at New York Climate Week surfaced a striking tension at the center of U.S. energy policy: demand for electricity is surging, the technology to meet it is accelerating, and Washington is getting in the way. Across three conversations, industry leaders described a clean energy sector with the best market fundamentals in history — and the most obstructionist politics in memory.

• Commonwealth Fusion Systems says a working fusion prototype in Massachusetts is roughly a year from turning on, with a commercial plant already in Virginia's grid queue and Google signed on as a power purchaser

• Over 30 completed wind projects are stalled at the Pentagon; the clean power industry's chief says a federal court has declared the delays illegal and ordered 30-day progress reports

• A new executive order on foreign-made grid equipment could trigger rolling brownouts if the administration enforces a broad rip-and-replace policy, the American Clean Power Association warns

• Siemens reports AI-powered building controls already deliver 30% energy savings and grid software enables 30% more load on existing infrastructure — solutions available now, not in a decade

• Electricity prices are heading sharply higher due to AI data center demand; the industry argues renewables are the difference between costs rising "a lot" versus "a ton"

Fusion's Kitty Hawk Moment, One Year Away

The basics: Commonwealth Fusion Systems, a startup spun out of MIT, is building a fusion energy prototype in Massachusetts that it says will produce significant fusion energy for the first time in a compact, commercially relevant device. The company has raised approximately $4 billion and is simultaneously developing a commercial-scale fusion plant in Virginia.

Why it matters: If fusion works at commercial scale, it would deliver virtually unlimited, zero-emission, dispatchable power — the energy source that every other technology is measured against but that has never left the laboratory. CEO Bob Mumgaard told Axios journalist Ben Geman that the timeline is no longer speculative.

"We think that moment in fusion is actually — we're talking a year. We're not talking 10 years. We're talking a year, maybe a little longer, but like that type of timeframe," said Mumgaard.

Where things stand: CFS has entered the PJM Interconnection queue — the regional grid operator covering 13 states and D.C. — for its Virginia plant, a milestone Mumgaard described as a first for the technology. "Literally requires the dropdown menu to be modified — solar, wind, fusion — which is the first time that we actually had an interconnect for this technology into any system," he said.

The company has secured a firm power purchase agreement with Google as the offtaker for the Virginia plant. But Mumgaard acknowledged CFS still needs several billion dollars more for full commercialization, and that first-of-a-kind financing remains a critical hurdle.

Federal Policy Treats Fusion as Science, Not Energy

Mumgaard was blunt about the gap between the technology's potential and Washington's approach. "Federal policy in the US has treated fusion as a science project, and it has been historically a science project, but it hasn't yet evolved into treating fusion as an energy project," he said. He pointed to Department of Energy loan guarantee programs as potentially catalytic, comparing them to the role those programs played in the early development of solar and offshore wind.

"In the US, these mechanisms that are either loan guarantee or milestone have been historically very, very catalytic," Mumgaard said.

On regulation, the news is more favorable: the Nuclear Regulatory Commission has unanimously determined that fusion falls under state jurisdiction rather than federal nuclear oversight, giving it a significantly lighter regulatory burden than traditional fission reactors. "It's gone through the NRC, and the NRC has unanimously said, actually, this is a state issue," Mumgaard confirmed.

The China Factor

Mumgaard flagged a stark international competition gap. "When you put the US against China, you have about a factor of somewhere between 3 and 5 spend rate difference and a different focus," he said — with China taking a more industrial, deployment-oriented approach while the U.S. keeps fusion housed in the DOE's Office of Science. The implication: even if American startups prove the technology first, China could outpace the U.S. in deploying it.

What's next: The Massachusetts prototype is expected to turn on within the next year. If it works, the conversation shifts from physics to manufacturing, financing, and deployment speed — and whether federal policy can catch up.

30 Wind Projects Held 'Hostage' at the Pentagon

Why it matters: The American Clean Power Association says more than 30 commercial-scale wind projects have completed the Department of Defense review process — historically a routine, same-day approval — but remain unsigned by Assistant Secretary Dale Marks since August. A federal court has now declared the delays illegal.

CEO Jason Grumet told Axios National Energy Correspondent Amy Harder that permitting reform has the best odds it has ever had of becoming law, but not while the administration is actively obstructing the projects those reforms are designed to enable.

"They're literally just holding hostage 30+ commercial-scale wind projects out of essentially spite," Grumet said.

He described two distinct problems colliding: genuinely inefficient permitting laws that need reform, and an administration that is deliberately weaponizing the existing process. "Dale's got to sign it and say, we're good to go. They haven't signed a single one since August," Grumet said.

Decisions: The clean energy industry took the administration to court and won an injunction. "The industry went to court and basically received an injunction that said what the administration is doing is illegal," Grumet said. The court now requires 30-day progress reports. Grumet added that the Secretaries of Energy and Interior have spoken to the President and expressed a desire to move permitting legislation forward — but he said Democrats will not support a bill they did not principally author unless they see good faith from the administration on existing approvals.

Harder referenced an earlier comment by Jared Agin that Pentagon reviews should not be a "rubber stamp," which Grumet rebutted by citing 20 years of routine approvals that historically cleared within a day.

Executive Orders and the Threat of Brownouts

Grumet described 11 executive orders issued after the repeal of Biden-era clean energy incentives, all designed to slow clean energy development. He singled out a new executive order targeting foreign-made grid equipment, which defers decisions to the Department of Energy and could force utilities to remove Chinese-connected components from the electrical grid.

"If the government decides that you have to rip and replace all of this equipment, any of which has any connection to China, we would basically just have rolling brownouts," Grumet warned.

The American Clean Power Association filed 86 pages of comments on the order and is collaborating with the Edison Electric Institute and API on the response. Grumet connected the executive order's timing to the President's upcoming meeting with Chairman Xi, framing it as part of broader antagonistic trade actions — including new tariffs affecting solar, battery, and advanced manufacturing supply chains.

He acknowledged legitimate concerns about spyware in foreign-made equipment but said the administration has abused national security claims before. "We've seen the administration use national security as a pretext to try to interrupt wind power. So it's hard to be confident that that might not happen again," he said.

Prices Are Going Up — the Question Is How Much

Grumet characterized the current market as "the best of times and the worst of times" — 90% of new grid electrons now come from clean sources, but the political environment has never been more hostile to the industry deploying them.

"90% of the electrons that came on the grid last year were coming from clean sources. Like, this is go time," he said.

Harder pressed on rising costs, noting that power purchase agreement prices have been climbing and tariffs are raising equipment costs. Grumet acknowledged that rising interest rates, inflation, and tariff-driven supply chain disruptions are real burdens for capital-intensive clean energy projects — but argued that the fundamental economics still favor renewables, especially as AI data center demand drives electricity consumption sharply higher.

"Renewable energy is the difference between whether it goes up a lot or a ton," Grumet said, pointing to Texas — where roughly 50% of generation now comes from renewables — as evidence that the strongest grids combine natural gas, nuclear, and clean energy.

What's next: Permitting reform legislation remains in play. Harder noted that ratepayer protection provisions are being discussed as a potential addition to the bill, which Grumet characterized as a politically attractive mechanism. The court-ordered 30-day progress reports on Pentagon wind approvals will serve as a public accountability measure in the coming months.

Siemens Says Industrial AI Can Deliver Climate Results Now

Why it matters: While fusion is a decade or more from commercial deployment and permitting reform grinds through Congress, Eva Riesenhuber, Global Head of Sustainability at Siemens, argued that proven technologies are already delivering significant energy and emissions reductions — and the window to embed them affordably is closing.

"Resource scarcity, extreme weather, biodiversity loss. We are right in the middle of it," she told Axios Publisher Nicholas Johnson, describing how sustainability targets have shifted from aspirational future goals to urgent present-day imperatives.

Where things stand: Riesenhuber cited concrete results from Siemens' AI-powered systems: "We can save about 30% of energy in a building with an AI-powered autonomous control of a building. It's really self-optimizing. We also — and that's even more interesting in times of grid congestion and long connection queues — we can get with our AI-powered grid software 30% more load on the same grid."

She described Siemens' vision of buildings as energy nodes in a connected grid system — using microgrids, heat pumps, and smart infrastructure to make every building both a consumer and a potential contributor to grid stability. She noted that Siemens' own factories have remained powered during disruptions because they run on renewables with these integrated systems.

On the investment case, Riesenhuber was direct about the cost of delay: "If we don't do sustainability at the same time, we find ourselves in 10 years and we have to redo it all again. No one has the money to do that. It's about affordability."

Johnson noted that the sustainability conversation in industry has shifted. "It sort of shifted from compliance more towards competitiveness, like resilience are the words," he said.

Riesenhuber also shared an unexpected application: Siemens is working with the Australian Institute for Marine Science, using AI and machine learning to monitor coral reef health through sound analysis. "You can listen now with AI to the reef and you know the health of the reef," she said — an example of how industrial technology is finding conservation applications.

What's next: Siemens Financial Services is helping customers finance transitions to net-zero factories and buildings, a signal that the company sees financing — not just technology — as the bottleneck for deployment at scale.