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1975, 1977, 1978, 1980, 1981, 1982, 1984, 1985, 1987, 1988, and
1990.
For Cycles 3 through 12, there were 72 fuel assemblies that
were replaced with 72 new fuel assemblies. The 72 fuel
assemblies in issue in this case were for Cycle 12 and were
placed in service on June 30, 1990. Cycle 12, including the
shutdown for reload and the operating cycle, began on April 7,
1990, and ended on February 14, 1992. The total cost of the fuel
assemblies for Cycle 12 was $28,181,923, with an approximate cost
of $391,500 for each of the 72 fuel assemblies. The fuel
assemblies that were used by petitioner had a class life of
5 years under the Modified Accelerated Cost Recovery System
(MACRS).
Petitioner’s goal was to produce electricity as economically
as possible, and, in order to minimize fuel costs, petitioner
used a variety of tail assays, varied enrichment levels, and a
combination of uranium procurement and enrichments. Although fit
and form of the fuel assemblies may have been essentially the
same, the function, or performance, of the fuel assemblies
changed over the course of the operation of the plant. For
example, higher enrichment levels in the fuel assemblies allowed
for a longer operating cycle.
Petitioner entered into general contracts for fuel assembly
fabrication services. Because petitioner sought maximum
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