I had not heard of this, but the group at the University of Gothenberg has several publications. I’ve only seen the abstracts because I don’t have access to the journals and don’t want to pay ~$30.00 per article to see them:
Patrik U. Andersson, Leif Holmlid, Ultra-dense deuterium: A possible nuclear fuel for inertial confinement fusion (ICF), Physics Letters A, In Press, Corrected Proof, Available online 1 July 2009, ISSN 0375-9601, DOI: 10.1016/j.physleta.2009.06.046.
S. Badiei, P. U. Andersson and L. Holmlid, “Fusion reactions in high-density hydrogen: A fast route to small-scale fusion?” Int. J. Hydr. Energy 34 (2009) 487-495.
S. Badiei, P. U. Andersson and L. Holmlid, “High-energy Coulomb explosions in ultra-dense deuterium: Time-of-flight mass spectrometry with variable energy and flight length”. Int. J. Mass Spectrom. 282 (2009) 70-76 doi:10.1016/j.ijms.2009.02.014.
Holmlid is an expert on Rydberg atoms (i.e. atoms in highly excited electronic states). Apparently, they claim to have produced a very compact state of deuterons under laser excitation, with evidence of these states decaying to release a characteristic amount of energy. The separation between the deuterons is something like 100 times smaller than normal, leading to density on the order of one million times higher. Without seeing the papers, it is hard to understand how you could bind two deuterons (or more) at such small distances with electrons. It has been shown to be possible with muons, which are 200X heavier than electrons. Even if they have somehow created metastable states that are this small, I can’t conceive that they could produce significant quantities of this ultra-dense material.
It is true that if you could make ultradense deuterium, the fusion rate would go up dramatically. Again, this has been demonstrated with muons. Even though muons decay in a couple microseconds, they last much longer than the fusion half life for diatomic deuterium ions bound by a single muon.
This all sounds intriguing, but I suspect it will go the way of Pons and Fleischman and their cold fusion pipe dream. I am surprised that this hasn’t gotten more press. Perhaps the Gothenberg team has been more cautious and realistic in what they have been telling the press.