Lie algebra cohomology and the fusion rules

We prove a vanishing theorem for Lie algebra cohomology which constitutes a loop group analogue of Kostant's Lie algebra version of the Borel-Weil-Bott theorem. Consider a complex semi-simple Lie algebra and an integrable, irreducible, negative energy representation of. Givenn distinct pointsz_k in , with a finite-dimensional irreducible representationV_k of assigned to each, the Lie algebra of-valued polynomials acts on eachV_k, via evaluation atz_k. Then, the relative Lie algebra cohomologyH^* is concentrated in one degree. As an application, based on an idea of G. Segal's, we prove that a certain homolorphic induction map from representations ofG to representations ofLG at a given level takes the ordinary tensor product into the fusion product. This result had been conjectured by R. Bott.