Abstract. The development of fusion promises a long term supply of energy with widespread resources and good safety and environmental properties. However the introduction of fusion into the future energy market will rely on the development of an economically viable fusion power plant. Although predictions of the likely cost of electricity produced by a future fusion power plant are uncertain, it is important that an assessment is made to ensure that the likely economics are not unreasonable. In this paper the impact of different physics (and other) constraints on the economics of fusion is considered. Comparison with the expected future cost of electricity from other sources must take account of the trends in the energy market, particularly at present towards sources with low external costs related to impact on human health and the natural environment. Although these costs depend on the country concerned, a range of expected future costs can be derived. Comparison with the expected range of fusion costs shows that fusion can contribute to the future energy market.