Where Japan is and Where Japan Will Go: Update of the Fukushima Accident and the Deliberation of Post-Fukushima Nuclear Energy Policy in Japan

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Japan has two laws governing nuclear third party liability: the Law on Compensation for Nuclear Damage and Law on Contract for Liability Insurance for Nuclear Damage. These laws say that plant operator liability is exclusive and absolute, and power plant operators must provide a financial security amount of JPY 120 billion (US$ 1.4 billion).

The government may relieve the operator of liability if it determines that damage results from “a grave natural disaster of an exceptional character”. In any case, however, liability is unlimited.

Judging that the Fukushima accident was a man-made disaster(to be precise, TEPCO asked the Government to postpone the legal decision of the applicability of the relief clause related with a grave natural disaster to expedite the damage compensation), the government set up Nuclear Damage Liability Facilitation Fund; a new state-backed institution to expedite payments to those affected.

The Fund is to receive financial contributions from electric power companies with nuclear power plants in Japan, and from the government through special bonds that can be cashed whenever necessary. The government bonds total JPY 5 trillion ($62 billion).

The provision for contributions from other nuclear operators is similar to that in the USA

They have not yet completed a Probabilistic Risk Assessment (PRA) of their plants that takes into consideration of the tsunami hazard curve (relation between tsunami height and its return period), however, as they have not yet obtained a reliable estimation of it for their plants.

Therefore they may be forced to accept a high risk premium for nuclear power generation in the discussion of desirable energy supply mix in the future.

The regulators and operators should work hard for restoring the public trust in their activities, as number of operating units will dwindle away to nothing by mid-2012 if no reactor restart approvals are given in due time.

Where Japan is and Where Japan Will Go: Update of the Fukushima Accident and the Deliberation of Post-Fukus…

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