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I think if there was the slightest chance of it being economical it would have been done by now
China to utilise spent fuel for heating and desalination.A Chinese group has agreed to build a 200 MWt nuclear reactor run on used fuel from nuclear power stations to provide district heating and desalination. The US$ 42 million project at Yingkou in Liaoning province will heat 5 million square metres of buildings over 4-6 months each year and initially desalinate 3000 tonnes (3 megalitres) of seawater per day in warmer months, rising to 80,000 tonnes (80 megalitres) later. The deep-pool reactor will operate at atmospheric pressure, which will reduce the engineering requirements for safety.Comtex 25/6/02 (via Wilmington).
I have just noticed your newsletter 2002 I wonder if it ever got built, China is a strange place they can do things there that are not possible in other parts of the world