The most distinguishing feature of the CANDU reactor is its ability to use natural uranium fuel, although the CANDU reactor would also be efficient at utilizing other fuels and fuel cycles. The natural uranium fuel cycle is simple and inexpensive, involving uranium mining, milling, refining, conversion to UO2 and fabrication of CANDU fuel bundles. For many countries, this avoids the expense and infrastructure associated with enrichment technology and contributes to self­reliance in nuclear fuel supply. As was discussed previously, the fuel bundle itself is small, simple and inexpensive. This results in the fuel cycle cost for a CANDU natural uranium fuelled reactor being roughly half that of an LWR (in $/kWh). The impact on CANDU fuel cycle cost of lower burnup is more than offset by the avoided costs of enrichment and conversion and by lower fuel fabrication costs, relative to LWR fuel (NEA/OECD, 1994). The natural uranium fuel cycle is also readily localized and all countries that have CANDU reactors also fabricate their own CANDU fuel.

Because of the focus on high neutron economy in the CANDU reactor and fuel design, the fuel utilization (thermal energy derived from the mined uranium) is up to 50% higher than for an LWR (Boczar et al, 1996). A contributory factor is the high conversion ratio in the CANDU reactor: the amount of plutonium created per unit of energy produced is about double that of a typical LWR. By the time the fuel has reached its discharge burnup, over 50% of the energy is being produced by the fissioning of plutonium.

The mass of used CANDU fuel produced per unit of electricity generated is about five times greater than for a typical PWR (Boczar et al, 1996). This is offset, however, by its lower decay heat in terms of the size and cost of used fuel storage or disposal facilities. Indeed, the cost of geological disposal of used fuel is more aligned with the total energy produced from the fuel, rather than its burnup. Hence, the cost of permanent disposal of used CANDU fuel is similar to the cost of LWR fuel disposal, per unit of electricity produced (Allan and Dormuth, 1999). Moreover, the low burnup of CANDU fuel results in a very small quantity of higher-mass actinides (such as americium and curium) per unit energy produced by the fuel, a benefit in terms of radiotoxicity of the used fuel.

It should also be noted that the low burnup of natural uranium fuel avoids some of the fuel performance challenges that arise at higher burnup, and this contributes to the excellent performance of CANDU fuel, with very few fuel failures. Occasional fuel failures can be detected and removed on-power with low economic penalty.

The resource efficiency of the CANDU reactor means that there is little residual fissile material remaining in the used fuel, making its recovery and recycling unattractive at the present time. The recoverable fissile content of used CANDU natural uranium fuel is about one-fifth of that in used LWR fuel. U-235 is at the level of enrichment plant tails (around 0.2% U-235 in total uranium) compared to around 0.9% in used LWR fuel, so there is no economic incentive to recycle the U-235 since there are several hundred thousand tonnes of depleted uranium in the form of enrichment plant tails readily available. The concentration of plutonium in used CANDU NU fuel is less than 40% of that in used LWR fuel: around 3.7 g Pu/kg HE compared with ~10 g Pu/kg HE for used LWR fuel, depending on the burnup. The fissile content of the plutonium in both used fuels is around 70%. Hence, the cost ($/kg HE) of recovering the plutonium would be much higher than for used LWR fuel. Nonetheless, the total quantity of plutonium in used CANDU natural uranium fuel for a given amount of electricity generated is about double that of LWR fuel, and the plutonium from used CANDU natural uranium fuel in Canada is potentially a valuable future resource if it could be economically recycled (Boczar et al., 2010).