So power plants are really expensive to build and have a very finite life. The investors who paid for it want as much money back as possible so they want the power plant running at peak capacity all the time.
Fuel rods have an enrichment of u238 which is the main component that gives heat. As the rods get spent, the enrichment drops and they give off less heat (not quite true but works for simplicity). The fuel rods could be used for a bit longer but it results in the reactor not operating at peak capacity so the investors lose out.
Tldr, we could use the spent rods longer and they’d still work but it wouldn’t be as financially beneficial.
There are schemes to re use the spent fuel rods. One such scheme is to utilise plutonium to make spent rods more “potent” to then be put back into conventional reactors
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