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Can fusion energy ever be economically competitive and what actually drives its cost? In this session from the MIT Independent Activities Period (IAP) course “Business of Fusion Energy,” we introduce Techno-Economic Analysis (TEA) as the primary framework used to evaluate the commercial viability of fusion power plants. Drawing on MIT Energy Initiative research, peer-reviewed journal work, and ongoing fusion economics studies, the session walks through how TEA connects engineering design choices to capital cost, operating cost, and electricity prices. Key topics include: What techno-economic analysis (TEA) is and who uses it (investors, startups, policymakers, researchers) Core terminology: overnight capital cost (OCC), O&M, LCOE, FOAK vs NOAK Why fusion economics are dominated by upfront capital costs, not fuel A bottom-up TEA of deuterium–tritium magnetic confinement fusion power plants Cost breakdowns for major plant systems, with emphasis on reactor plant equipment and fabrication The role of learning curves (Wright’s Law) in reducing fusion costs over time LCOE comparisons between fusion and other energy technologies How regulatory assumptions and manufacturing scale influence cost uncertainty The session emphasizes that while cost uncertainty remains high, TEA provides a structured way to identify key sensitivities, performance thresholds, and cost-reduction levers as fusion moves from first-of-a-kind (FOAK) plants toward mature deployment.