(Yicai) March 3 -- China Fusion Energy, a state-owned pioneer in an experimental technology to produce unlimited amounts of clean energy by replicating processes of the sun, has gained almost CNY1.8 billion (USD240.3 million) in investment from two major power companies.

China Nuclear Power, another affiliate of Beijing-headquartered China National Nuclear Corporation, invested CNY1 billion into Fusion Energy, while Zhejiang province-based thermal power giant Zheneng Electric Power allocated CNY750 million (USD102.8 million), the two investors announced recently.

After these transactions, CNNC remains the largest shareholder of Fusion Energy, which is expected to receive more investment from state-owned enterprises in the future.

Fusion Energy was founded last September with CNY3.5 billion in registered capital. Less than a year before that, CNNC said that it would join forces with 24 state-owned enterprises, research institutes, and universities to establish the company after a series of technological breakthroughs in developing the controllable nuclear fusion device China Gyre-3, often referred to as an "artificial sun."

Fusion Energy is a pioneer in the investment-heavy field of nuclear fusion, a next-generation technology to produce limitless amounts of clean energy without long-lasting nuclear waste. However, firms in the field still need to solve current reactor issues such as extreme temperatures, complex design, and high energy input.

China Nuclear Power and Zheneng aim to establish a forward-looking position in the field of nuclear fusion and lay a foundation for commercial application, they said, without disclosing the size of their stakes. Technological breakthroughs require long-term research and a large amount of capital, the two investors said, adding that investments in Fusion Energy are unlikely to be profitable in the short term and carry a risk of commercialization failure.

Besides this state-owned company, China has several private nuclear fusion startups such as Energy Singularity and Transwarp, which have completed their respective angel and pre-A rounds of financing. Energy Singularity announced last June that it was involved in an experiment where the world's first full high-temperature superconducting tokamak device achieved its first plasma, a high-energy state of matter where electrons are separated from nuclei, which is an essential step in creating massive amounts of energy in the reactor.

China Nuclear Power [SHA: 601985] closed 1.4 percent higher at CNY9.71 (USD1.30) in Shanghai today.

Zheneng [SHA: 600023] ended the day unchanged at CNY5.49.

Editors: Tang Shihua, Emmi Laine