Management and Disposition of Excess Weapons Plutonium Reactor-Related Options (1995) / Chapter Skim
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Chapter 3: Criteria for Comparing Disposition Options
Chapter 3: Criteria for Comparing Disposition Options
Pages 59-115
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From page 59... ...
Accordingly, our discussion of relevant criteria for comparing the options for WPu disposition begins with the security risks: their nature, the dispositionoption characteristics that influence them, and the formulation of figures of merit to quantify or otherwise illuminate those influences. The issues of timing and capacity how quickly an option can be put into operation and how rapidly it can process WPu thereafter will be seen to be tightly intertwined with other aspects of security, and we treat these matters together here.
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From page 60... ...
incentives and disincentives for further nuclear arms reductions in the United States, the former Soviet Union, and other nuclear-weapon states; incentives and disincentives for acquisition of nuclear weapons by other countries; and management of reactor plutonium in ways that increase its accessibility to prospective bomb-makers. Time Frames in Which the Threats Mc`;y be Operative · the near term, roughly the next 10 years, within which the quantities of WPu accumulated from dismantlement activities are increasing and most disposition options would be in their developmental or initial operational stages; · the middle term, roughly from 10-50 years hence, within which most disposition options would be in full operation and at the end of which the bulk of the surplus WPu would have been processed; and · the long term, beyond 50 years hence, wherein the surplus WPu would be in whatever final form and location had resulted from the disposition option selected.
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From page 61... ...
(c) Could the options that might become available for eliminating surplus WPu, or otherwise making it less accessible for use in weapons than is plutonium in civilian spent fuel, be expanded (with tolerable cost, uncertainties, and timing)
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From page 62... ...
Candidate disposition options typically consist of several steps, beginning with intact nuclear weapons, proceeding through some number of intermediate processing, storage, and transport steps, and ending with either the physical destruction of the plutonium (by fission or transmutation) or its disposal in a form and location where it is intended to remain until its disappearance via radioactive decay.
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From page 63... ...
integrated inventory, i.e., average inventory in step times duration in years (kilograms-years) ; and dilution of plutonium in accompanying material (kilogram of material per kilogram of plutonium)
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From page 65... ...
The start date of the first disposition step beyond the storage of pits is a particularly informative indicator of security risk, since it reflects the duration of a phase of plutonium management that is problematic both from the standpoint of the attractiveness, for weapons purposes, of the stored material and from the stand point that delay in moving beyond pit storage may call into question the commitment of the possessor states to actually demilitarizing this material, with potentially harmful influences on the prospects for further nuclear arms reductions and for nonproliferation. This first start date beyond pit storage depends on the state of scientific and technical readiness of the disposition option and the research and development time needed to remedy any defects in these respects; on the time needed to construct all of the relevant facilities; on the time needed to accomplish any necessary licensing steps; and on the time needed to gain acceptance for the option by the relevant publics and decision-makers (which might include, for example, local and state as well as federal officials, electric utility managements, or foreign governments)
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From page 66... ...
. These two i2ntegrated inventory figures are, in our view, reasonably informative indicators of the timing aspect of security, and they are calculable with a minimum of assumptions about the details of the disposition options.
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From page 67... ...
We take natural, lowenriched, or depleted uranium to be the 0 reference point for radiologic hazard, and characterize HEU as 1, WPu in metal or plutonium oxide as 2, reactor plutonium in metal or plutonium oxide as i, and plutonium in spent fuel or mixed with high-level radioactive wastes as 4. The twenty-fold or more dilution from 3 It should be noted that the gap between level 3 and 4 is very large in this case, amounting to a qualitative difference.
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From page 68... ...
Mass/Bulk. This barrier relates to whether the form of the material permits ready partitioning in a way that facilitates concealment on the person of a thief or diverter (as would be the case with small quantities of HEU or plutonium metal or oxide, taken as level 0)
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From page 69... ...
Accordingly, our security-risk comparisons among disposition options presented in Chapter 6-stress the identification and characterization, for each option, of the most vulnerable step or steps. The foregoing matrix scheme for characterizing security hazards bears some relation to official classification schemes for nuclear materials subject to safeguards, such as those of the U.S.
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From page 70... ...
¢ at o o no cn .
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From page 71... ...
, or 2 10,000 g U-235 contained in uranium enriched to 210 percent but <20 percent U 235 [73.21. Special nuclear material of low strategic significance means less than an amount of spe cial nuclear material of moderate strategic significance but > 15 g U-235 contained in uranium enriched to 20 percent or more in U-235, or > 15 g of U-233 or plutonium, or > 15 g in combination calculated as grams contained U-235 + g U-233 + g Pu, or > 1,000 g U-235 contained in uranium enriched to 210 percent but <20 percent U 235, or 2 10,000 g U-235 contained in uranium enriched above natural but |
From page 72... ...
Our scheme is more disaggregated and more context-dependent than these other approaches, as we believe is necessary in order to illuminate as fully as present information and judgment allow the security characteristics of alternative options for WPu disposition. Criteria for Choice Characterization of the security risks of the various disposition options in the matrix format just described will provide insight into the loci of greatest risk within each option, as well as a basis for judgmental comparison of overall risk between options.
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From page 73... ...
If the inaccessibility of WPu is made comparable to that of civilian plutonium in the middle of this age distribution that is, civilian plutonium in spent fuel 20-30 years old the existence of the WPu in this form would not markedly increase the security risks already associated with the civilian spent fuel.
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From page 74... ...
whether the activities are carried out by government or civilian entities, or a combination, and corresponding assumptions about . the real cost of money and rates of return appropriate for the entities operating the option, and · property taxes and insurance costs associated with the facilities and operations involved; (c)
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From page 75... ...
Variations and inconsistencies in the treatment of these factors make it practically impossible to derive informative conclusions about costs of alternatives from direct comparison of final cost estimates obtained in different studies of the individual disposition options; rather, it is necessary to construct a consistently based set of estimates starting from the building blocks (such as estimates of direct construction costs, or of labor and materials requirements) that such studies provide.
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From page 76... ...
For federal government projects, values for the real cost of money in the range of r = 4-5 percent per year often have been used in recent years, corresponding to nominal rates of return on long-term government bonds in the range of 7 to 8 percent per year and inflation rates, experienced and projected, in the x The average annual rate of inflation from 1972-1992, based on the GDP implicit price deflator, was 3.7 percent per year, the corresponding average for 1987-1992 was 3.5 percent per year, and that for 1990-1992 was 3.2 percent per year (US Dept of Commerce 1992) ; the January 1993 estimate of the Council of Economic Advisors for the period 1992-1995 was 2.6 percent per year (CEA 1993)
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From page 77... ...
, and, as noted, is certainly defensible as a value of the real cost of money to the government based on prevailing government-bond yields and inflation rates. The guidelines published by OMB for benefit-cost analysis of federal programs, however, call for the use of a real cost of money of 7 percent per year for projects that have effects in the private sector, i.e., outside the government (OMB 1992~.
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From page 78... ...
Some consequences of DOE's decision to use a figure of only 4 percent per year in its Plutonium Disposition Study are discussed below. Property Taxes and Insurance Corporate and individual income taxes enter, where appropriate, into the determination of the real cost of money, while, by convention, property taxes and insurance are accounted for by the addition, to the fixed charge rate (FCR)
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From page 79... ...
We have assumed, for purposes of our own economic evaluation, that these PDS direct-cost estimates were correctly and consistently obtained. In the several cases in which we consider plutonium disposition options not evaluated in the DOE study, we have assumed that the estimates of direct costs made available to us by others were derived by procedures roughly consistent with those used in the DOE work.
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From page 80... ...
and former Soviet Union costs to be so great, however, as to make them not worth attempting at the present time, and we have confined our detailed economic estimates to contexts outside the former Soviet Union. Indirect Construction Costs In detailed cost-estimation work, indirect construction costs are broken down into detailed subcategories that are estimated individually.
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From page 81... ...
It has been difficult to determine, from the often less-than-transparent contractor and TRC reports, how extensive and drastic these nonuniformities were, or to what extent the TRC was able to correct them in the process of arriving at its own adjusted cost estimates. It is, similarly, often difficult to tell what conventions concerning indirect costs were used in obtaining cost estimates found elsewhere in the literature for options not
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From page 82... ...
The magnitude of the multiplicative correction factor depends on the duration of the preoperational period, the phasing of the investments during this period, and the real cost of money. Magnitudes are shown in Table 3-7 for construction periods of 3, 6, and 9 years, typical "S-curve" investment trajectories, and real costs of money of 4, 7, and 10 percent per year.
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From page 83... ...
Distributions of construction costs among years are: 0.25, 0.50, 0.25 for the 3-year case; 0.05, 0.15, 0.30, 0.30, 0.15, 0.05 for the 6-year case; and 0.03, 0.07, 0.125, 0.17, 0.21, 0.17, 0.125, 0.07, 0.03 for the 9-year case. real costs of money, which leads to impressively large but essentially meaningless figures.)
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From page 84... ...
or capitalize the D&D cost as an increment to the initial investment I (equal to the at-shutdown figure divided by (1 + rank. Another "comprehensiveness" issue that arises in comparative costing of plutonium disposition options is the need for consistent treatment of the costs of any required conversion of plutonium from the metallic form in which it is found in the pits from dismantled nuclear weapons to oxide or other forms required by particular disposition options.
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From page 85... ...
Net Versus Gross Costs and Revenues and the Treatment of Sunk Costs Perhaps the most fundamental conceptual issues in the economic evaluation of plutonium disposition options are (1) distinguishing the net costs and revenues attributable to the plutonium disposition mission itself from the gross costs and revenues associated with larger contexts in which the disposition mission may be embedded, such as generation of electricity, and, relatedly, (2)
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From page 86... ...
This situation typically arises in connection with plutonium disposition options that generate electricity, but it also would apply to the incorporation of WPu into glasses being produced in facilities that would have to exist anyway for the purpose of disposing of high-level radioactive wastes. The costs that should be assigned to the plutonium disposition mission in such cases are only those attributable to the modifications for purposes of plutonium processing-of the preexisting system, including any changes in operating cost and any replacement costs or avoided costs associated with decreased or increased outputs (e.g., steam, electricity, vitrified wastes)
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From page 87... ...
A given disposition option will often be made up, of course, of a variety of activities falling into more than one of the above categories, in which case a proper accounting of the costs may require particular care in matching the appropriate costing conventions to different parts of the project. In DOE's PDS, in which all of the options considered involved the construction of new reactors for the combined purpose of plutonium disposition and electricity generation, the avoided costs were taken to range from about $0.03/kWh in the year 2000 to about $0.05/kWh in the year 2050 (1992 dollars)
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From page 88... ...
In fact, however, the economic calculations finally presented in the PDS documents were not done this way; instead, they simply credited against the total costs of the project all estimates based on a real cost of money of 4 percent per year- the avoided-cost electricity revenues calculated by Hudson in the manner just described. The effects of the inappropriately low cost of money that was assumed and the inappropriately low "firmness" factor embedded in the avoided-cost calculation partly cancel, but the cost-of-money effect is bigger and produces, as a result, an over-optimistic impression about the financial aspects of the new reactor disposition options considered in the PDS.
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From page 89... ...
It is possible that the higher figure would prove to be correct, however, so this discrepancy is not a major concern. "' In the NDPV approach, for example, the value of the facilities at the end of the plutonium disposition phase is equal to the DPV, at that time, of the stream of avoided costs from electricity generation in the remainder of the facilities' operational lives, less the DPV, at that time, of the future operating and decommissioning costs.
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From page 90... ...
Nor is there any need, as some may have felt at times in the past, to push ES&H concerns aside in order to expedite programs crucial to national security. Certainly, reducing the security risks posed by surplus WPu is the paramount goal in choosing a disposition option for this material, but that goal can and must be accomplished subject to reasonable ES&H constraints.
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From page 91... ...
should not add significantly to the ES&H burdens that would be expected to arise, in the absence of WPu disposition, from appropriate management of the environmental legacy of past nuclear-weapon production and from appropriate management of the ES&H aspects of past and future civilian nuclear-energy generation. Disposition options in Russia or in other countries should meet the same three criteria, with the single modification that in criterion (1)
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From page 92... ...
and (2) (such as the radiological risks from large accidents at nuclear reactors, criticality accidents in plutonium/waste mixing processes, or failures of confinement at nuclear waste repositories, the projected health damages to future generations from uranium-mill tailings, and risks to workers if they actually were exposed Up a working lifetime to the currently permitted occupational dose rates )
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From page 93... ...
-(c) strongly suggest that our three proposed ES&H criteria for plutoniumdisposition options can be considered sufficient in these senses.
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From page 94... ...
~) ~ ~ ~ ~ ~ r The Main ES&H Issues in Weapons Plutonium Disposition According to the criteria proposed and justified above, the focus of an ES&H assessment of plutonium disposition options should be on identifying and analyzing those aspects where there is some possibility that a plutonium option either could have difficulty meeting relevant standards or could add significantly to the risks of similar kinds that do or will exist in any case from appropriately managed nuclear electricity generation and military nuclear waste disposal.
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From page 95... ...
Which specific radiological issues will be the critical ones in relation to our three ES&H criteria for plutonium disposition depends on whether reactor options or nuclear waste options are under consideration.
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From page 96... ...
; · mixing the oxides and fabricating the MOX into fuel pellets, fuel rods, and fuel assemblies; the storage and transport steps associated with the preparation of the MOX fuel, its delivery to the reactor, and its storage there prior to use; · reduction in the amount of uranium mined, milled, converted, enriched, and fabricated, by virtue of the substitution of MOX fuel for some of the uranium-only fuel that would otherwise have been used; · any changes in the ES&H characteristics of reactor preparation, operation, and maintenance as a result of the use of WPu in its fuel; and any changes in the ES&H characteristics of waste management including spent fuel storage and transport, further high-level waste processing (for other than once-through systems) , emplacement and residence in a geologic repository, and management of low-level and transuranic wastes that result from the use of WPu in the fuel.
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From page 97... ...
These three issues the ramifications of plutonium for reactor and plutonium/waste mixing process safety, nuclear waste issues, and occupational hazards of fuel preparation receive the bulk of our attention to ES&H issues in the remainder of this report. OTHER CONSIDERATIONS In addition to the security, economic, and ES&H criteria just described, approaches to management and disposition of excess WPu must be acceptable to the public and the relevant institutions, and should, to the extent possible, avoid conflict with other policies and objectives.
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From page 98... ...
Finally, we do not believe that whether plutonium disposition options would also have the potential to produce tritium should be a major criterion for deciding among them.
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From page 99... ...
In the case of an initial inventory that is subsequently depleted over an indefinite period by, e.g., radioactive decay, the integrated inventory is the initial inventory times the average lifetime of a plutonium atom in that initial inventory before it decays. More generally, an expression for Qift)
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From page 100... ...
If, however, the characteristics of the process more than the characteristics of the site produce security risks that make it desirable to characterize separately the actual in-process integrated inventory, this can be done by calculating the average in-process inventory from avg inventory = avg throughput (kg/day) x residence time (days)
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From page 101... ...
Ultimate Disposition 101 It would be fairly straightforward to calculate also an integrated inventory figure for the final phase of a plutonium disposition campaign, in which for example the plutonium is embedded in spent fuel or vitrified high-level waste that remains indefinitely in engineered storage or a geologic repository. In that case, the integrated inventory would be the initial inventory in this form multiplied by the radiologic mean-life of the plutonium, which is the half-life divided by the natural log of 2.
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From page 102... ...
such as fuel, spare parts, and labor for operation and maintenance: LAC = LACC + LAOC = FCR x I + LAOC. The procedure for levelizing operating costs that occur nonuniformly over the operating life of the project is straightforward; it is analogous to the way the 13 The formula and the concept are identical to those applicable to home mortgages7 except that the latter are ordinarily arranged so that the annual payment is levelized in current rather than constant dollars (meaning the formula contains r' in place of r)
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From page 103... ...
of an expenditure or income of C dollars at a time n years into the future is given by PV = C / (1 + In, where d is the real discount rate (usually taken to be the same as the real cost of money, r) , and DPV and C are both expressed in constant dollars of a specified year.
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From page 104... ...
The formula can be generalized to include costs and revenues that arise earlier than year O i.e., before the "present" in the present-value calculationsimply by letting i take on negative values. The NDPV approach to economic evaluation answers the question, "What lump sum of money should~a rational economic actor be willing to pay at a specified "present" time in order to acquire a project's future net income (NDPV positive)
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From page 105... ...
The foregoing approaches also suffer from uncertainty about the future: Will other electricity costs have gone up or down by the time that reactors are in operation using WPu? A further problem that can arise with these approaches is the misleading impression produced when avoided-cost estimates based on private-sector generating costs are credited against the costs of plutonium disposition options assumed to have been financed at the low cost of money associated with government borrowing.
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From page 106... ...
The weakness in the case for using the same-reactor-but-with-LEU approach to avoided cost is in the second condition: few analysts today would argue that nuclear plants would be likely to be chosen, in the absence of the plutonium disposition mission, for new ~, For a 7-percent per year real cost of money and nominal plant lifetime of 30 years, the fixed charge rate without allowance for property taxes and insurance would be 0.0806 per year; an allowance of 2 percent for these costs would make it 0.1006 per year, representing about a 25percent increase in the fixed charge rate and hence in the annual capital charges.
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From page 107... ...
. Sensitivities: natural gas price +30 percent yields +$0.01/kWh; overnight construction cost 30 percent higher adds $0.003/kWh; real cost of money r = 0.10 adds $0.004/kWh (actual cost of money employed by firms in the wholesale electricity market may be higher still)
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From page 108... ...
108 PL UTONIUM DISPOSITION: REACTOR-RELA TED OPTIONS nium disposition reactors in the Northwest United States uses a range of $0.037-$0.043/kWh for gas-fired combined-cycle baseload power generation in that region (SAIC 1993~; the DOE PDS analysis uses $0.030/kWh for the reference revenue from electricity sales and explores sensitivity to a range from $0.022/kWh to $0.060/kWh (USDOE 1993a)
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From page 109... ...
Virtually all of the national and international regulatory and advisory bodies dealing with radiation hazards have taken the position for many years, however, that standards and policy should be based on the assumption that increases in the incidence of cancer and genetic defects persist in linear proportion to the dose, down to the lowest doses and dose rates experienced (the "linear hypothesis"~.'9 The most recent comprehensive review of this subject by the National Research Council's Committee on Biological Effects of Ionizing Radiation (National Research Council 1990, p. 4, hereinafter BEIR V)
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From page 110... ...
for gamma and beta radiation at high dose rates or neutron and alpha irradiation at any dose rate, and 400 excess cancer deaths per 104 person-Sv for gamma and beta radiation at low dose rates. The incidence of excess genetic defects induced by radiation is considerably more uncertain, but the estimates given in the BEIR V report are equivalent to 30-70 excess genetic defects per 104 person-Sv an incidence rate some 10 times less than that of excess cancer deaths, and spread over a considerably longer (multigeneration)
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From page 111... ...
The occupational dose limit of 0.05 Sv per year would correspond, at 0.40.8 percent probability of cancer death per 0.1 Sv, to an extra chance of cancer death of 0.2-0.4 percent per year. Exposure to this dose rate continuously from the age of 18 to the age of 65 would produce an extra probability of cancer death of 15 percent raising the preexisting probability of death from cancer from about 20 to 35 percent" according to the best estimate of the BEIR V report based on a calculation accounting for age- and gender-specific susceptibilities in a working population of half men and half women.
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From page 112... ...
"Calculation of Revenues for Plutonium Disposition Reactors" Unpublished manuscript, Oak Ridge National Laboratory, Oak Ridge Tennessee, April 5, 1993. IAEA 1982: International Atomic Energy Agency.
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From page 113... ...
Washington, D.C.: National Academy Press, 1992. OECD 1976: Organisation for Economic Co-operation and Development, Nuclear Energy Agency.
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From page 114... ...
Nuclear Energy Cost Data Base A Reference Data Base for Nuclear and Coal-Fired Power Plant Generation Cost Analysis.
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From page 115... ...
USNRC 1989: U.S. Nuclear Regulatory Commission.
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