Why is Helium-3 better than Deuterium for fusion energy production?

While D-He3 fusion reaction rate peaks at smaller energies than D-D (see this picture), and produce more energy (18MeV for D-He3 vs. 3-4MeV for D-D reaction), this is not the main reason why some people think He3 is a 'better' fuel. The main reason is that D-He3 fusion fuel cycle is aneutronic. That is, all fusion products (if we disregard auxiliary branches) are charged particles and there are no neutrons released in this reaction.

For more information read corresponding wiki page, but the main reasons neutrons are considered 'bad' in fusion are following:

• energetic neutrons require considerable shielding (there are no other way to stop them other than slow them down in matter and then absorb).

• neutrons cause material activation, producing radioactive waste.

• if large portion of fusion energy is released with neutrons, this means that electricity has to be produced through thermal conversion (steam turbines with relatively low efficiency). On the other hand, if all energy released as a charged fusion products, then the electricity could be produced by direct conversion with potentially much higher efficiency and much smaller devices.

Additionally, one half of D-D reactions produces radioactive tritium that either has to be 'burned', or stored.

All of this would be especially crucial in space, where shielding + turbines + radiators for excess heat will make D-D fuel less attractive then D-He3 if there is sufficient space industry to make He3 mining viable.

Nuclear physics often doesn't make sense without understanding the underlying quantum mechanics (and then, it often makes even less sense even though the numbers add up ;-)

In a nutshell, Deutrium is pretty stable compared to Helium-3. Helium-3 is more "desperate" to fill the missing neutron than Deutrium is to merge with a twin to form Helium.

In other words, you need less energy to make Helium-3 to fuse with Deuterium to form Helium + ionized Hydrogen pairs than to fuse Deuterium with itself into Helium.

More details in Wikipedia.