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Japan's nuclear export industry collapsing

Nuclear Monitor Issue: 
#871
4772
25/01/2019
Jim Green ‒ Nuclear Monitor editor
Article

Japan Times reported in February 2017 that Japanese firms have attempted "with little success" to sell their nuclear technologies to countries as diverse as France, Vietnam, India, Turkey, Hungary, Poland, Slovakia, the Czech Republic and the United Arab Emirates.1

Since then, the prospects for Japan's nuclear export industry have gone from bad to worse. Hitachi's recent suspension of the Wylfa and Oldbury reactor projects in the UK is another nail in the coffin of Japan's nuclear export industry.

Last November, Toshiba announced its decision to liquidate its NuGen subsidiary, which was planning to build Westinghouse AP1000 reactors at Moorside in the UK.2 As recently as June 2016, Toshiba said its goal was to win orders for at least 45 AP1000 nuclear reactors overseas by 2030.1 But Toshiba subsidiary Westinghouse filed for bankruptcy in March 2017 ‒ nearly bankrupting its parent company in the process ‒ and was later sold to Canadian investment company Brookfield Business Partners for about US$4.6 billion (considerably less than US$5.4 billion Toshiba paid for Westinghouse in 2006).3 Toshiba has exited the reactor construction business.

Pro-nuclear commentator Dan Yurman wrote in May 2018: "The biggest black eye that Japan has gotten in recent years isn't from cleanup troubles at Fukushima, but from the multi-billion dollar cost overruns at the V C Summer site [in South Carolina] where Toshiba's Westinghouse ran the project into the ground with self-inflicted management failures."4

It seems very likely that Mitsubishi Heavy Industries' (MHI) plan to take a lead role in the building of four reactors at Sinop in Turkey will be formally abandoned in the near future.5 In 2018, MHI told the Turkish government that the cost of the project would total around ¥5 trillion (US$45.6 billion), more than double the original estimate of about ¥2.1 trillion (US$19.2 billion).6 "We cannot accept this" cost increase, a Turkish government official reportedly told MHI representatives.7 Itochu Trading House, a Japanese company, exited the Sinop project consortium in 2018 due to the escalating costs and unrealistic timeframe.4,9

A dozen Japanese companies were involved in the JINED consortium that hoped to build reactors in Vietnam. Japan's Ministry of Economy, Trade and Industry was to provide significant financing and insurance, but Vietnam cancelled its nuclear power plans in 2016.10 Reuters reported following the cancellation: "Though it has sought contracts for years, Japan has never led a nuclear project to completion overseas and Abe has lent his office's prestige to attempts to win contracts ... The dented ambitions for exports come at a time when Japan is struggling to restart dozens of reactors shut down in the wake of Fukushima."11

Japan has concluded a nuclear cooperation agreement with India, but it's doubtful that it will lead to any work for Japanese companies. Tom Corben noted in The Diplomat in December 2017 that Japan's willingness to supply India's nuclear power program is problematic: "Meanwhile, as a non-signatory to the Nuclear Non-Proliferation Treaty, the ambiguous nature of assurances from the Indian government that Japanese technology will not be used to produce nuclear weapons is worrying, as is the lack of legal definition around the circumstances in which Japan may justifiably abandon the deal."12

In October 2018, Toshiba and IHI decided to dissolve a joint venture formed in 2011 to manufacture and supply nuclear plant equipment.8 IHI will keep its nuclear business alive but is shifting energy operations towards renewables as well as hydrogen and other non-fossil-fuel options.13

Toshiba has exited the reactor construction business (but continues to work on maintaining, repairing and decommissioning existing plants), sold Westinghouse, and exited the joint venture with IHI. Other Japanese utilities are also shifting from reactor construction to decommissioning. TEPCO, Chubu Electric Power, Hitachi and Toshiba are negotiating a partnership in areas including reactor decommissioning and maintenance.8

Government support for nuclear exports

A December 2018 editorial in The Mainichi questioned the Japanese government's continuing promotion of nuclear exports:14

"Projects to export nuclear power plants, a pillar of the "growth strategy" promoted by the administration of Prime Minister Shinzo Abe, appear to be crumbling.

"Factors behind the failures include ballooning construction costs due to strengthened safety standards after the triple core meltdowns at Tokyo Electric Power Co.'s (TEPCO) Fukushima Daiichi Nuclear Power Station in March 2011, and growing anti-nuclear sentiments around the world.

"Nothing else can be said but that the export projects have effectively failed. The prime minister's office and the Ministry of Economy, Trade and Industry must bear the responsibility of continuing to promote these exports despite a massive change in the attitude toward nuclear power plants. …

"In 2012, a national referendum in Lithuania voted down a project to build a Hitachi nuclear power plant, and then in 2016, Vietnam scrubbed a similar construction plan. The same year, Japan signed a nuclear cooperation agreement with India, eyeing exports of nuclear power plants despite concerns about the proliferation of nuclear materials to the nuclear weapon state outside of the Nuclear Non-proliferation Treaty. Still, the export plan has yet to materialize. It is clear that the export of nuclear power plants has been backed into a corner for quite some time already. …

"Continuing to focus on nuclear power export, however, will lead Japan nowhere. The government should take another look at global trends, and review the basis of its nuclear power policy to rid Japan of nuclear power as soon as possible."

Loss of skills

Japan's nuclear export ambitions are crumbling and there is little chance of new reactors being built in Japan. Thus Japan is fast losing the capacity to build reactors at home or abroad. The Nikkei Asian Review reported in December 2018:8

"The biggest challenge for Japanese manufacturers losing nuclear orders will be retaining and passing on skills. Around 3,000 people were engaged in nuclear-power-related work in 2016, down sharply from the 2010 peak of 13,700, while the number of technical workers in the field has tumbled 40%, according to the Japan Electrical Manufacturers' Association. This has raised concerns about whether the industry will have enough engineers to handle decommissioning work, demand for which is set to rise as power companies scrap old reactors. 'In the U.S., technical know-how at Westinghouse Electric and General Electric sharply declined during a long stretch of time without new nuclear construction,' said an executive at a heavy industry group, adding that the same loss of skills 'is sure to happen in Japan.'"

The Japanese nuclear export industry did have one small win in 2018: Idaho National Laboratory subcontracted GE Hitachi to work with Bechtel to advance design and cost estimates for an experimental fast neutron reactor based on GE Hitachi's PRISM technology. The US Department of Energy plans to decide in 2020 whether or not to proceed with the project. If built, the reactor will be operated as a national test facility ‒ a source of fast neutrons to help researchers develop fuels and materials for fast reactors.15 Dr Ed Lyman from the Union of Concerned Scientists questioned the wisdom of the project, noting that compared to conventional light-water reactors, fast reactors are less safe, more expensive, and more difficult to operate and repair.16

That one, small win does nothing to change what Tadashi Narabayashi, a professor at the Tokyo Institute of Technology, recently described as a "critical situation" for Japan's nuclear power industry.17 "Japan would lose its own atomic power industry, and would have to import Chinese-made nuclear plants 20 years from now," he said.

References:

1. Eric Johnston, 15 Feb 2017, 'Toshiba's woes weigh heavily on government's ambition to sell Japan's nuclear technology', www.japantimes.co.jp/news/2017/02/15/national/toshibas-woes-weigh-heavil...

2. Nuclear Monitor #869, 28 Nov 2018, 'Toshiba gives up on Moorside nuclear power project in the UK', https://www.wiseinternational.org/nuclear-monitor/869/toshiba-gives-moor...

3. World Nuclear Association, http://www.world-nuclear.org/our-association/publications/weekly-digest/...

4. Dan Yurman, 7 May 2018, 'Japan's Plans for Nuclear Exports Hit Speed Bumps', https://neutronbytes.com/2018/05/07/japans-plans-for-nuclear-exports-hit...

5. Nikkei Asian Review, 4 Dec 2018, 'Japan to scrap Turkey nuclear project', https://asia.nikkei.com/Economy/Japan-to-scrap-Turkey-nuclear-project

6. Mainichi Japan, 4 Jan 2019, 'Japanese gov't plan to export nuclear power technology floundering', https://mainichi.jp/english/articles/20190104/p2a/00m/0bu/030000c

8. Masamichi Hoshi, Kenji Asada and Takashi Tsuji, 5 Dec 2018, 'Japan Risks Losing Nuclear Prowess With Turkey Project Abort', https://asia.nikkei.com/Business/Business-Trends/Japan-risks-losing-nucl...

9. Nuke Info Tokyo No. 184, May/June 2018, 'Itochu Withdraws from Turkish NPP Project', www.cnic.jp/english/?p=4137

10. World Nuclear Association, 'Nuclear Power in Vietnam'. http://www.world-nuclear.org/information-library/country-profiles/countr...

11. Aaron Sheldrick and Ho Binh Minh, 18 Nov 2016, 'Japan's nuclear export ambitions hit wall as Vietnam set to rip up reactor order', https://www.reuters.com/article/us-japan-vietnam-nuclearpower-idUSKBN13D0RK

12. Tom Corben, 22 Dec 2017, 'Japan's Nuclear Exports: Risky Business', https://thediplomat.com/2017/12/japans-nuclear-exports-risky-business/

13. Kenji Asada and Yukinori Hanada, 19 Oct 2018, 'Toshiba and IHI drop nuclear venture in shift to renewable energy', https://asia.nikkei.com/Business/Companies/Toshiba-and-IHI-drop-nuclear-...

14. The Mainichi, 25 Dec 2018, 'Editorial: Japan must ditch nuclear plant exports for global trends in renewable energy', https://mainichi.jp/english/articles/20181225/p2a/00m/0na/011000c

15. World Nuclear Association, 15 November 2018, 'PRISM selected for US test reactor programme', http://www.world-nuclear-news.org/Articles/PRISM-selected-for-US-test-re...

16. Ed Lyman, 15 Feb 2018, 'The "Versatile Fast Neutron Source": A Misguided Nuclear Reactor Project', https://allthingsnuclear.org/elyman/a-misguided-nuclear-reactor-project

17. Mainichi Japan, 4 Jan 2019, 'Japanese gov't plan to export nuclear power technology floundering', https://mainichi.jp/english/articles/20190104/p2a/00m/0bu/030000c

 

Fukushima Fallout: Updates from Japan

Nuclear Monitor Issue: 
#870
4768
19/12/2018
Compiled by Nuclear Monitor
Article

Reactor restarts

There were five reactor restarts in Japan in 2018, but the number of permanent reactor shut-downs continues to grow even faster. Nuclear Monitor noted in May 2018 that of Japan's pre-Fukushima fleet of 54 reactors (55 including the Monju fast breeder reactor), eight reactors were operating and 16 had been permanently shut down.1 As of December 2018, nine reactors are operating and 20 have been permanently shut down.

1. Nuclear Monitor #861, 28 May 2018, 'Reactor restarts and energy policy in Japan', https://wiseinternational.org/nuclear-monitor/861/reactor-restarts-and-e...

2. US Energy Information Administration, 28 Nov 2018, 'Japan Has Restarted Five Nuclear Power Reactors in 2018', www.eia.gov/todayinenergy/detail.php?src=email&id=37633

Japan's nuclear export industry facing extinction

Japan's nuclear export industry could be dealt a fatal blow if Mitsubishi Heavy Industries pulls out of a massive project to build four large power plants on Turkey's Black Sea coast, as reports have suggested. The Sinop plant project in Turkey was seen as Japan's best chance for an industry – battered and bruised after the 2011 tsunami and triple meltdown at Fukushima – to put together a workable export strategy that did not break the bank of potential international customers.

Meanwhile, it is not just Mitsubishi that may have doubts about the sector. Japan's nuclear export industry has suffered plenty of setbacks in the seven years since Fukushima. Questions about the future of the sector hang over all three main players in the sector ‒ Mitsubishi, Toshiba and Hitachi.

Toshiba, one of Japan's big-three nuclear constructors, recently pulled out of the nuclear power business overseas after incurring huge losses in the United States.

If the export program is to remain viable, it may be in Wales, where the British government is seeking to build a two-reactor nuclear power plant on the island of Anglesey. Among those bidding for the project is Japan's third nuclear constructor, Hitachi, through a subsidiary called Horizon Nuclear. Now, there are worries that Hitachi might pull out of the British project. Chairman Hiroaka Nakanishi was quoted in the Times of London saying his company was "facing an extreme situation," and that a final decision on whether to stay with the project or leave it will be made next year.

Abridged from Todd Crowell / Asia Times, 16 Dec 2018, 'Sun setting on Japan's nuclear export sector', www.atimes.com/article/sun-setting-on-japans-nuclear-export-sector/

Japan must halt returns to Fukushima, says UN rights expert

In March, the Japanese government announced that it had accepted the recommendations made at the United Nations Human Rights Council (UNHRC) on the rights of evacuees from the Fukushima accident.1 But the government has been slow to act.

In a report released in October, the UN Special Rapporteur on hazardous substances and wastes, Baskut Tuncak, has urged the Japanese Government to halt the ongoing relocation of evacuees who are children and women of reproductive age to areas of Fukushima where radiation levels remain higher than what was considered safe or healthy before the nuclear disaster in 2011.2

Tuncak said the Japanese Government's decision to raise by 20 times what it considered to be an acceptable level of radiation exposure was deeply troubling, highlighting in particular the potentially grave impact of excessive radiation on the health and wellbeing of children.

"It is disappointing to see Japan appear to all but ignore the 2017 recommendation of the UN human rights monitoring mechanism (UPR) to return back to what it considered an acceptable dose of radiation before the nuclear disaster," he said.

A representative from the Japanese delegation to the UN said that "the government continues its effort to attain the long-term target for individual additional dose of exposure to radiation per year to within 1 millisievert".3

In response, Tuncak reminded the Japanese delegate that the Universal Periodic Review of the Human Rights Council issued a recommendation in 2017 to lower the acceptable level of radiation back down from 20 mSv/yr to 1 mSv, and noted "concerns that the pace at which that recommendation is being implemented is far too slow, and perhaps not at all."

Following the nuclear disaster in 2011, Japan raised the acceptable level of radiation for residents in Fukushima from 1 mSv/year to 20 mSv/year. The recommendation to lower acceptable levels of exposure to back to 1 mSv/yr was proposed by the Government of Germany and the Government of Japan 'accepted to follow up' on it. But in Tuncak's view, the recommendation is not being implemented.

Japan has a duty to prevent and minimise childhood exposure to radiation, Tuncak said. The UN Convention on the Rights of the Child, to which Japan is a Party, contains a clear obligation on States to respect, protect and fulfil the right of the child to life, to maximum development and to the highest attainable standard of health, taking their best interests into account. This, Tuncak said, requires State parties such as Japan to prevent and minimise avoidable exposure to radiation and other hazardous substances.

In March 2017 housing subsidies stopped for self-evacuees, who fled from areas other than the government-designated evacuation zones. Tuncak said: "The combination of the Government's decision to lift evacuation orders and the prefectural authorities' decision to cease the provision of housing subsidies, places a large number of self-evacuees under immense pressure to return. The gradual lifting of evacuation orders has created enormous strains on people whose lives have already been affected by the worst nuclear disaster of this century. Many feel they are being forced to return to areas that are unsafe, including those with radiation levels above what the Government previously considered safe."

In August 2018, Tuncak and two other UN Special Rapporteurs argued that Japan must act urgently to protect tens of thousands of workers who are reportedly being exploited and exposed to toxic nuclear radiation in efforts to clean up the damaged Fukushima nuclear plant.4

"Workers hired to decontaminate Fukushima reportedly include migrant workers, asylum seekers and people who are homeless," said the rapporteurs. "We are deeply concerned about possible exploitation by deception regarding the risks of exposure to radiation, possible coercion into accepting hazardous working conditions because of economic hardships, and the adequacy of training and protective measures. We are equally concerned about the impact that exposure to radiation may have on their physical and mental health."

1. Greenpeace, 8 March 2018, 'Japanese government accepts United Nations Fukushima recommendations - current policies now must change to stop violation of evacuee human rights', www.greenpeace.org/japan/ja/news/press/2018/pr20180308/

2. Baskut Tuncak, 18 Oct 2018, 'Report of the Special Rapporteur on the implications for human rights of the environmentally sound management and disposal of hazardous substances and wastes', www.ohchr.org/Documents/Issues/ToxicWastes/A_GA73_45821.docx

See also UN OHCHR, 25 Oct 2018, 'Japan must halt returns to Fukushima, radiation remains a concern, says UN rights expert', www.ohchr.org/EN/NewsEvents/Pages/DisplayNews.aspx?NewsID=23772&LangID=E

3. Ariana King, 26 Oct 2018, 'Japan should not push residents back to Fukushima: UN expert', https://asia.nikkei.com/Politics/Japan-should-not-push-residents-back-to...

4. Nuclear Monitor #866, 21 Sept 2018, 'Fukushima clean-up workers, including homeless, at grave risk of exploitation, say UN experts', https://wiseinternational.org/nuclear-monitor/866/nuclear-monitor-866-24...

Compensation for Nuclear Damage Act

On November 2, a bill for the partial amendment of the Compensation for Nuclear Damage Act (CND) was submitted to the Diet.

The Asahi Shimbun editorialized:1

"The government is trying to wriggle out of overhauling the way compensation should be paid out for damages caused by a nuclear accident. A working group of the government's Atomic Energy Commission had been considering ways to bolster the system, including raising the amount of losses covered by insurance, but failed to produce a formal proposal. The commission apparently failed to obtain support for these ideas from the electric power and insurance industries.

"The panel started reviewing the system in the aftermath of the 2011 Fukushima nuclear disaster. Nearly eight years have passed since the catastrophic triple meltdown at the Fukushima No. 1 nuclear power plant, yet serious problems and flaws remain unaddressed with the current system. The government clearly has no intention of tackling them anytime soon."

The Tokyo-based Citizens Nuclear Information Center said:2

"The main points of the draft amendment are: 1) Nuclear power plant (NPP) operators are mandated to prepare and publish a new damage compensation implementation policy, 2) Creation of a system for the government to lend funds to the operator for early compensation (provisional payments) to affected persons before the start of the main compensation payments, 3) In the case that alternative dispute resolution (ADR) by the Nuclear Damage Dispute Reconciliation Committee is terminated, it will be deemed that an appeal has been submitted at the time of the request for settlement mediation if the appeal is brought before the court within one month after the notification of termination of ADR, and 4) The compensatory fund is to be left unchanged at 120 billion yen.

"It is surprising that 1) is not already being carried out by NPP operators. At the time of the TEPCO Fukushima Daiichi nuclear accident the government had already devised measures similar to 2) for provisional compensation in the Act on Emergency Measures for Damage due to Nuclear Accidents. 3) can be said to be rational since there has been a series of cases in which the nuclear business side has rejected settlement proposals. On the other hand, the content of 4) is strikingly problematic since it does nothing to adjust the astoundingly miserly current compensatory fund of 120 billion yen in the face of the estimated 22 trillion yen in damages for the TEPCO Fukushima Daiichi nuclear accident.

"Originally, CND began as an exemption of makers from liability due to nuclear accidents in order to encourage the construction of nuclear power plants. The discussions in the latest series of reviews have progressed with no mention of this point, but in fact we believe the specialist committee should have taken one step further and questioned the liability of nuclear reactor makers. …

"CND is directly linked with the problem of the interests of citizens regarding how nuclear energy risks are distributed under the unlimited liability of nuclear business operators. If NPPs are to be operated on just a very small burden, the risk of "cheap NPPs" is essentially borne by the citizens. The bill for the amendment utterly fails to resolve this problem and would allow NPPs to be operated with the citizenry, as ever, bearing the huge risk involved. Implementing deregulation of the power industry while accepting that it is fine to push this enormous risk onto the citizens greatly alleviates the burden on nuclear business operators and will lead to a serious deterioration in the competitive environment."

1. Asahi Shimbun, 1 Nov 2018, 'Editorial: So who will foot the bill if another nuclear disaster strikes Japan?', ww.asahi.com/ajw/articles/AJ201811010019.html

2. Citizens Nuclear Information Center, Nov/Dec 2018, 'CNIC Statement: Don't push the risk onto citizens with the amendment of the Compensation for Nuclear Damage Act', Nuke Info Tokyo No. 187, www.cnic.jp/english/?p=4253

Workers' accident compensation insurance payment

The labor ministry said on 12 December 2018 that the thyroid cancer of a male worker, exposed to radiation after the triple meltdown at the Fukushima No. 1 plant, has been recognized as a work-related disease. Following the decision by a labor ministry panel of experts, the labor standards inspection office of Hitachi, Ibaraki Prefecture, reached the conclusion on Monday. The man in his 50s became the sixth person to be granted a workers' accident compensation insurance payment over cancer caused by the March 2011 nuclear disaster at the plant operated by TEPCO. He is the second person to be compensated due to thyroid cancer.

Japan Times, 13 Dec 2018, ' Tepco-linked firm employee's thyroid cancer caused by work after Fukushima nuclear plant meltdown, labor ministry admits', www.japantimes.co.jp/news/2018/12/13/national/tepco-linked-firm-employee...

Treatment and disposal of contaminated soil

Millions of cubic metres of contaminated soil (and other debris) are accumulating in the Fukushima off-site clean-up zone with little hope of a resolution to the problem.

Hideyuki Ban, co-director of the Citizens Nuclear Information Center, discusses changes in the government's 'basic thinking' about the problem:

"The first "basic thinking" was announced by the Ministry of the Environment (MoE) on June 30, 2016 and has been added to twice since then. The latest version was announced on June 1, 2018 and is available on the MoE website. The official title is "Basic Thinking on the Safe Use of Reclaimed Materials from Removed Soil." 'Removed soil' refers to soil derived from decontamination work. The original plan was to transport this soil to the interim storage facility scheduled to be constructed in the surroundings of the Fukushima Daiichi Nuclear Power Station and then transport it outside Fukushima Prefecture after 30 years.

"When it became clear that contaminated soil in Fukushima Prefecture would reach 22 million cubic metres (m3), however, it was thought that "final disposal of the total amount would be unrealistic from the viewpoint of securing, etc. the necessary final disposal sites," and the "basic thinking" turned to recycling. Since the outlook for attaining agreements to construct final disposal sites outside Fukushima Prefecture is bleak, this was a makeshift plan to reduce, as far as possible, the volume of contaminated soil.

"Transport of the soil outside Fukushima Prefecture after 30 years was already enshrined in law, but considering that it was nigh on impossible to agree on where it should go, we can therefore say that reducing the amount to be disposed of through recycling is simply a means for straightening out the official story. The "Technological Development Strategy for Volume Reduction and Recycling of Removed Soil in Interim Storage," announced in April, ahead of the "basic thinking," clearly stated the target of reducing the volume of contaminated soil to be transported outside Fukushima Prefecture after 30 years to about 10% of the original amount. …

"[T]he technological development for soil treatment is thought to consist of 1) grading sand and gravel from the fine-grain component of the soil (silt and clay) that easily adsorbs cesium and then separating the cesium adhering to the sand and gravel, 2) a chemical treatment method whereby cesium is firstly eluted from the soil by a strong acid, etc., after which the cesium is recovered by an adsorbing agent, and 3) heat treatment, where cesium is volatilized by heating, then cooled and trapped. Each of these has problems and a technological development roadmap has been produced, according to which the basic technological development for all methods is to be completed over a period of ten years. Of these, the grading treatment is a technology that is already available and is positioned as the technological development that will be undertaken first.

"The general idea is that the amount of soil of 8,000 Bq/kg and below will be increased using the technologies developed and then recycled. The use of the removed soil for recycling, at or less than 8,000 Bq/kg, is to be "limited to embanking materials, etc. as component materials for structural foundations in public works, etc."

Hideyuki Ban goes on to note that 100 Bq/kg is the clearance level for recycling materials from the demolition of nuclear power facilities, 80 times lower than the 8,000 Bq/kg proposed for contaminated soil in Fukushima Prefecture. The higher figure had been used as a clearance level for waste disposal, not recycling, but it "has been slowly turned on its head until 8,000 Bq/kg has become the standard for reuse. … These measures to straighten out the official story are making double standards the normality. In fact, there is the fear that the current clearance standards will be relaxed for certain uses. This creeping relaxation is totally unacceptable."

Three 'demonstration projects' have been proposed in Fukushima Prefecture. One ‒ a contaminated soil recycling project in Nihonmatsu City ‒ has already been cancelled due to local opposition. There are still two demonstration projects being implemented in Fukushima Prefecture, one in Minamisoma City (soil grading) and one in Iitate Village (an unpromising proposal to lay down contaminated soil on farmland and cover it over with 50 cm of uncontaminated soil).

Outside Fukushima Prefecture, projects are positioned as burial demonstration projects, and these are to take place at two locations, Nasu Town, Tochigi Prefecture and Tokai Village, Ibaraki Prefecture.

Hideyuki Ban, 2 Oct 2018, 'Treatment and Disposal of Contaminated Soil', www.cnic.jp/english/?p=4225

Contaminated water continues to accumulate at Fukushima

Still no solution to the problem of what to do with contaminated groundwater, reactor cooling water and rainwater at the Fukushima nuclear plant. The volume continues to grow, albeit at a slower rate than in previous years. The government's preferred plan ‒ diluting contaminated water then dumping it into the ocean ‒ continues to be strongly resisted.

As of March 2018, about 1.05 million cubic metres (m3) of water were being stored in over 1,000 tanks, with an annual rate of increase of about 50,000 to 80,000 m3.1 Currently, the storage tanks have a capacity of about 1.13 million tons and TEPCO plans to secure 1.37 million tons of storage capacity by the end of 2020.2

The 'Advanced Liquid Processing System' (ALPS) supposedly removes all radionuclides other than tritium. However, as the Citizens Nuclear Information Center noted in October, many citizens were surprised and angered when it was reported that other nuclides besides tritium were also present, sometimes at concentrations exceeding the notification concentration.1

The Telegraph reported on October 16:3

"Water that the Japanese government is planning to release into the Pacific Ocean from the crippled Fukushima Dai-Ichi nuclear plant contains radioactive material well above legally permitted levels, according to the plant's operator and documents seen by The Telegraph.

"The government has promised that all other radioactive material is being reduced to "non-detect" levels by the sophisticated Advanced Liquid Processing System (ALPS) operated by the nuclear arm of Hitachi Ltd. Documents provided to The Telegraph by a source in the Japanese government suggest, however, that the ALPS has consistently failed to eliminate a cocktail of other radioactive elements, including iodine, ruthenium, rhodium, antimony, tellurium, cobalt and strontium. ...

"A restricted document also passed to The Telegraph from the Japanese government arm responsible for responding to the Fukushima collapse indicates that the authorities were aware that the ALPS facility was not eliminating radionuclides to "non-detect" levels. That adds to reports of a study by the regional Kahoko Shinpo newspaper which it said confirmed that levels of iodine 129 and ruthenium 106 exceeded acceptable levels in 45 samples out of 84 in 2017. ...

"Tepco has now admitted that levels of strontium 90, for example, are more than 100 times above legally permitted levels in 65,000 tons of water that has been through the ALPS cleansing system and are 20,000 times above levels set by the government in several storage tanks at the site.

"Dr Ken Buesseler, a marine chemistry scientist with the US Woods Hole Oceanographic Institution, said it was vital to confirm precisely what radionuclides are present in each of the tanks and their amounts. "Until we know what is in each tank for the different radionuclides, it is hard to evaluate any plan for the release of the water and expected impacts on the ocean", he told The Telegraph. ...

"Shaun Burnie, a nuclear specialist with Greenpeace, also disputes Tepco's claims that tritium is effectively harmless. "Its beta particles inside the human body are more harmful than most X-rays and gamma rays", he said, adding that there "are major uncertainties over the long-term effects posed by radioactive tritium that is absorbed by marine life and, through the food chain, humans.""

Aileen Mioko-Smith from Kyoto-based Green Action Japan said last year: "This accident happened more than six years ago and the authorities should have been able to devise a way to remove the tritium instead of simply announcing that they are going to dump it into the ocean. They say that it will be safe because the ocean is large so it will be diluted, but that sets a precedent that can be copied, essentially permitting anyone to dump nuclear waste into our seas."4

To determine what to do with ALPS-treated water, the Japanese government created the Tritiated Water Task Force in December 2013 and it operated until June 2016.1 The Task Force evaluated five options: geological disposal, land burial (solidified in concrete), oceanic release, atmospheric release (as steam) and a second type of atmospheric release (as hydrogen). It held public hearings in August 2018 to get a broad overview of the views of Japan's citizens on the problem of reputational damage.

Nobuko Tanimura from the Citizens Nuclear Information Center argues that it would not be possible to force through oceanic releases right away.1 A firm decision may be some time away and a final resolution to the problem even further away. If a decision is made to proceed with ocean dumping, it would take another 2‒3 years to prepare for the water's release into the ocean according to Nuclear Regulation Authority chair Toyoshi Fuketa.5

Nikkei Asian Review summarized the situation facing fishers in a November 2018 article:6

"Since a catastrophic nuclear accident seven years ago, Fukushima fishermen have made painstaking efforts to rebuild their livelihood, assiduously testing the radioactivity levels of their catches to ensure safety. Now, rapidly accumulating wastewater from the crippled power plant is again threatening this hard-won business recovery.

"Faced with the prospect that there will be no more space to store tanks containing radioactive water leaking from the Fukushima Daiichi nuclear power plant, operator Tokyo Electric Power Co. Holdings and the Japanese government are considering diluting the water and dumping it into the ocean.

"Even though Fukushima's fishery has been recovering, the haul throughout the entire prefecture amounted to about 3,300 tons last year, just 10% of the average prior to the 2011 disaster. And even reaching there has not been easy. Fish markets in the prefecture now house testing rooms filled with equipment. Staff members mince seafood caught every morning to screen for radioactivity. Such painstaking efforts gradually enabled fishermen to return to the sea, with all fishing and farming operations resuming in February this year. But the trend could reverse if the government goes through with plans to release nuclear wastewater into the sea. ...

"Resolving the wastewater issue is a key step in achieving a sustainable fishing revival in Fukushima, according to Shuji Okuda, an official in charge of decommissioning and wastewater management at the Ministry of Economy, Trade and Industry's Agency for Natural Resources and Energy.

"I understand that we should cooperate for revival," one Fukushima fisher said. "But I'm afraid of the damage to our reputation," this fisher said. "I don't want them to dump anything into the ocean." ...

"At Tokyo's Toyosu market, wholesale prices for fish caught in the prefecture sell for about 30% cheaper than product from neighboring areas, according to a major wholesaler. Some distributors do not stock up on the prefecture's seafood for fear of driving away customers. ...

"In turn, domestic lobbying groups are resisting plans to discharge nuclear wastewater into the ocean ‒ at least not until there is consensus at home and abroad that the practice is safe. "As a national representative of fishers, we oppose it," said JF Zengyoren, the nationwide federation of fishing cooperatives. "The reputational risk is still at hand," said Tetsuji Suzuki, managing director at the Fukushima Prefectural Federation of Fisheries Co-operative Associations."

1. Nobuko Tanimura, 2 Oct 2018, 'The Fukushima Daiichi Nuclear Accident: Current State of Contaminated Water Treatment Issues and Citizens' Reactions', www.cnic.jp/english/?p=4219

2. The Yomiuri Shimbun, 19 May 2018, 'Storage capacity for radioactive water at Fukushima power plant nears limit', http://the-japan-news.com/news/article/0004451987

3. Julian Ryall, 16 Oct 2018, 'Japan plans to flush Fukushima water 'containing radioactive material above permitted levels' into the ocean', www.telegraph.co.uk/news/2018/10/16/japan-plans-flush-fukushima-water-co...

4. The Telegraph, 14 July 2017, 'Fishermen express fury as Fukushima plant set to release radioactive material into ocean', www.telegraph.co.uk/news/2017/07/14/fishermen-express-fury-fukushima-pla...

5. Japan Times, 11 Jan 2018, 'Regulator urges Tepco to release treated radioactive water from damaged Fukushima No. 1 nuclear plant into the sea', www.japantimes.co.jp/news/2018/01/11/national/regulator-urges-tepco-rele...

Takumi Sasaki, 4 Nov 2018, 'Radioactive water threatens Fukushima fishery's fragile gains', https://asia.nikkei.com/Economy/Radioactive-water-threatens-Fukushima-fi...

Social peripheries and the siting of nuclear facilities in South Korea and Japan

Nuclear Monitor Issue: 
#865
4746
06/09/2018
Jinyoung Park ‒ Ph.D. student in Environmental and Energy Law, School of Law, Seoul National University
Article

In July 2017, there was an interesting event in South Korea. The government asked a citizens panel to consider whether or not the partially-built Shin Kori 5 and 6 reactors should be completed. Since it was settled to complete the construction, many researchers tried to analyze why people, even local residents who live near the plant, supported the project. This article aims to answer that question.

The paper focuses on the unique siting patterns of nuclear-related facilities in South Korea, and compares it with the situation in Japan. In both nations, most nuclear facilities have concentrated in a few locations including several considered here – Ulju and Gyeongju in Korea, and Futaba and Rokkasho in Japan.

In theoretical perspective, this study started with the concept of 'social peripheralisation', which is suggested by Andrew Blowers and Peter Leroy (1994). They investigated several LULU (Locally Unwanted Land Use) facilities in Europe, and concluded that these types of facilities tend to be located in marginal regions in various aspects. Earlier studies also linked the siting of such facilities to social marginalisation (see Blauner, 1972). Blowers and Leroy focused on the process and characteristics of conflicts, how local regions and members of the community reacted to the siting of each facility, and identified five aspects of peripheralisation: economic marginality; geographic remoteness; environmental degradedness; cultural defensiveness; and political powerlessness.

Ulju: Kori and Shin Kori nuclear complex

Ulju in the south-eastern area of South Korea has three nuclear power plants (Shin Kori-4/5/6). When combined with the adjacent Gijang region (Kori-2/3/4 and Shin Kori-1/2/3), it is one of the largest nuclear complexes in the world.

A noteworthy point in this region is that Ulju accepted three plants because of Gijang. This is explained by then-governor, Jin-gu Park: "KEPCO plans to build four reactors in Hyoam region in Gijang. As you might know, Hyoam is close to our boundary. Thus, it might be regarded that the specific location is not the matter of issue in the aspect of safety, but when it comes to the compensation, it can bring distinctive differences. Thus, I considered that it seems better to invite the facility to our region on economic grounds." (Ulsan Local Council, 1999)

It illustrates that Ulju already shared a certain level of risk from nuclear plants in Gijang, and accepting nuclear plants in Ulju would bring a massive economic benefit. For instance, in its long-term development strategy by Ulju Development Institute (2014) identifies neighboring regions, such as Gijang and Gyeongju, not only as partners but also rivals for development. Considering the above points, it seems that Ulju is highly affected by its faith in economic development and the existing risk of nuclear energy.

At the same time, the government played a crucial role encouraging the acceptance of nuclear power reactors. In South Korea, there are several laws that require the government and utilities to financially support the place that hosts the electricity generating plant. According this rule, Ulju KHNP (Korea Hydro and Nuclear Power) announced the payment ‒ solely for the siting of Shin Kori 3 ‒ of ₩31.5 billion (US$28.0 million) in acquisition tax, ₩2.4 billion (US$2.1 million) in special tax for rural development, and ₩1.4 billion (US$1.24 million) in local education tax to Ulju district (Yonhap News, 2016).

In fact, there was aggressive opposition by people in Ulju when the government tried to build Shin Kori 3 there. However, KHNP completely ignored local opposition. And local politicians also regard the nuclear project as an 'inevitable task' from the perspective of local politics; therefore, even the local government could not easily oppose the plan.

When we returned to the recent situation of Ulju, people formed a tight alliance to protect the Shin Kori reactors from the President's policy to review whether or not construction should be completed. The background to this turn-around is evident in a comment by Lee san-dae, one of the local residents: "Whilst local people intensively opposed the siting of Shin-Kori 3 and 4 reactors, opposition faded. Over time, it was acknowledged that we cannot make any changes in the case of Shin-Kori 5 and 6 plants, and people decided to cooperate with the siting." (Lee, 2017).

Gyeongju: low and intermediate level radioactive waste

Gyeongju lies in the north-east corner of the Korean Peninsula, and is well known as the capital of the Shill dynasty for nearly a century. From this historical background, it is also called the treasure house of historical and cultural assets in Korea. In this sense, the regional economy in Gyeongju relies highly on the tourism industry and related service sector (the tertiary sector accounts for 51% of all employment).

To manage these historical sites, the government set strict regulations about urban development and planning, such as altitude and structure limitation of buildings. However, these so-called 'Culture belt' regulations have been a stringent obstacle for regional development and urban planning for Gyeongju (Jang, 2005). These circumstances are a cause of deep resentment towards the national government for people in Gyeongju, and resulted in the aspiration for self-reliance and local development (Choi, 2007).

Additionally, as Gyeongju constantly failed to win national projects (for example, a Taekwondo park and racecourse in 2005), they came to argue that this was regional discrimination compared to neighboring regions, such as Busan, Pohang and Ulsan, which are major hubs of industrialization. Put differently, Gyeongju shows similarities to Ulju in its faith for economic development and competition with neighboring regions.

Moreover, Gyeongju has already hosted six nuclear plants (Wolsung 1-4 and Shin Wolsung 1 and 2) since 1983. The plants significantly contributed to the region's growth, not only creating economic supports but also hiring approximately 10% of their workforce in the region. These points seem to have contributed to people's positive perceptions about hosting a repository for low and intermediate level radioactive waste.

Cho (2007), however, criticized the process, describing how peripheral communities tend to lose their identities and set their development strategy into inviting so-called NIMBY and LULU facilities. From this perspective, backward communities reinforce their marginality as a consequence of efforts to overcome their powerlessness through the siting of nuclear-related facilities.

In Gyeongju, the radioactive waste repository has been built and the nuclear industry has become a major channel for regional development rather than tourism and related industries. As an example, Gyeongju and Gyeongsanbuk-do plan to show the city as the core of the nuclear cluster while accumulating further facilities, such as research institutes.

Futaba: Fukushima nuclear reactors

Prior to the Fukushima accident, there were six reactors at the Fukushima Daiichi nuclear power plant and four reactors at Fukushima Daini. Fukushima is said to be the core of Genpatsu Ginza, translated as Nuclear Plaza; it was one of the largest nuclear clusters in the world.

The nuclear plant in Fukushima was invited in an unexpected way. A member of the House of Councilors from Fukushima constituency, Kimura tried to utilize Futaba's idle lands for the nuclear energy business, and discussed it with Sato Kiichi (then governor of Fukushima prefecture) and Kigawada Kazutaka, a Fukushima-native then vice-president of TEPCO (Fukushima Minpo, 2011).

Another noteworthy pillar can be regional poverty in the Futaba area. Although local people subsisted on the agriculture and fishery industries, Dekasegi (going to other cities for work) was the daily routine for members of the village, especially in the winter (NHK, 2013). The public briefing by TEPCO promoted a local nuclear plant as 'free from Dekasegi'.

At the start of construction, the stimulation of the regional economy seemed enough to give local residents the impression that 'Fukushima is becoming the city'. In fact, according to Three Power Source Development Laws, Okuma town marked significant growth in the 1970s with the benefits from the nuclear facilities. The situation in Futaba town was similar. Fixed asset tax for Futaba town in 1982 reached approximately ¥1.9 billion, which was nearly half the total revenue. In addition, in terms of TEPCO in Futaba town, it created almost one-third of regional employment, including outsourcing firms, according to calculations by Shimizu (2004). Furthermore, the construction industry and service sectors (such as restaurants, cleaning services and barber shops) that targeted workers in the nuclear industry expanded across the region

However, the nuclear-focused regional economy could not last for long. Under the structure of the Three Power Laws, in order to secure tax revenue, the region had to prove their demand, which means they were required to invest more budgets to acquire more taxation. In spite of constant attempts, they could not reduce the pace of collapse of the nuclear-reliant regional economy, especially in Futaba town.

This extremely vulnerable structure of the regional economy drove Futaba town to rely on additional calls for nuclear facilities (Tohoku Politics and Economics, 1997). In September 1991, Futaba local council unanimously passed a bill to invite further nuclear power plants. These were to be the 7th and 8th reactors at Fukushima Daiichi; however, the plan did not materialize due to the disaster. Concerning these phenomena, Sato Eisaku, governor of Fukushima from 1988 to 2006, likened it to 'drug addiction' (Sato, 2011).

Moreover, nuclear energy was not only embedded in the local community, it also restructured the community. Kainuma (2011) argues that local people tend to see minor and individual risks as 'inevitable', and consequently negative opinion cannot be expressed in the society. These mindsets help them live in their hometown with their family and neighbors. In essence, it can be said that local residents rebuilt their lifestyles, and reached a position that self-justified their co-existence with nuclear power facilities. This pattern seems critical to understanding the background of the powerful nuclear regime and myth of nuclear safety in Japan ‒ the myth that was one of the drivers of Fukushima accident.

Consequently, it seems noteworthy that Fukushima invited the nuclear reactors to their community to combat poverty; but it caused the antithetical situation that reinforced addictiveness in the aspects of economic and cultural support.

Rokkasho village: nuclear fuel cycle facilities

Rokkasho village is located in the northeast peninsula, the so-called Shimokita-hantou (Shimokita peninsula) in Aomori prefecture, Japan. This project was triggered by the Mutsu-ogawara plan to build huge petrochemical and steelmaking plants. However, the first and second oil shocks resulted in a complete shift of the government's plans. This was an alarming event, not only for the national government but also for Aomori prefecture because the debts of the existing Mutsu-ogawara partners had risen from ¥82.7 billion to ¥130 billion (US$1.17 billion) since the plan was initiated, due to the non-disposal of land. Arguably, this financial circumstance strongly affected the invitation of the next development scheme ‒ nuclear fuel cycle facilities in the Rokkasho region.

However, the Chernobyl accident aroused people's attention to oppose the project. Thus, the nuclear fuel cycle became a core election issue. Despite aggressive demonstrations, the result was that the pro-nuclear candidate, Kitamura Masaya, who was supported by the utilities and the ruling party, was reappointed as a governor.

At present, Rokkasho village is one of the few regions that promote nuclear power, even after the Fukushima accident. The economic influences of the nuclear facility, particularly financial support and employment, might have encouraged local people to choose a nuclear-friendly candidate (Itoh, 2016). Rokkasho village has been the richest region in Japan. Also in Rokkasho village, nearly 10% of local people work at JNFL.

According to Funabashi (2012), although economic benefits from the nuclear fuel cycle have accelerated local acceptance, there remains local concern and questions about the facility. It has been shown that 61% of people in Rokkasho village said they wished the nuclear fuel cycle could be scaled down if they could ensure employment in alternative ways. Whilst people seem to be positive regarding nuclear facilities due to the economic and employment benefits, there is an underlying uncertainty and fear.

Conclusion: toward sustainable nuclear transition

Governments and firms promise large economic incentives to win support for nuclear projects. Marginal communities ‒ hollowed, aged communities and those which already host similar facilities ‒ tend to accept the trade-off between financial support and safety risks. Also, once they accept nuclear facilities, those facilities shape their surrounding region and pro-nuclear sentiment tends to grow as dependence sets in. Thus nuclear facilities in South Korea and Japan are generally found in concentrated clusters. As Andrew Blowers emphasizes, social peripheralisation is not a one-time phenomenon, it constantly exacerbates their marginality.

South Korea and Japan have both pledged to reduce their reliance on nuclear power and the processes of peripheralisation and marginalisation will shape the unfolding energy transition.

This article is based on a longer article: Jinyoung Park & Benjamin K. Sovacool, 2018, 'The contested politics of the Asian atom: peripheralisation and nuclear power in South Korea and Japan', Environmental Politics, 27:4, 686-711, https://doi.org/10.1080/09644016.2018.1439436

References

Blauner, R. (1972) Racial Oppression in America, New York: HarperCollins Publisher.

Blowers, A. and Leroy, P. (1994) 'Power, Politics and Environmental Inequality: A Theoretical and Empirical Analysis of the Process of 'Peripheralisation', Environmental Politics, 3(2), pp. 197-228.

Cho, S. (2007) 'How Does the Democratic Institution Bring the Retreat of Democracy? - A Study of the Bureaucratic Reform and Nuclear Waste Depository Policy under the Noh Moo Hyun Government', Economy and Society, pp. 139-170. (in Korean)

Choi, J., (2007) Nuclear waste facility siting in Korea: the relations between government compensation, distance, and the public's judgement of risk, Ph.D. Dissertation, University at Albany, State University of New York.

Fukushima Minpo (2011a) 'Increasing nuclear reactor, ignore safety claim', Fukushima Minpo, 26 November [Online]. Available at:

www.minpo.jp/pub/topics/jishin2011/2011/11/post_2583.html (Accessed: 29 August 2018). (in Japanese)

Itoh, N. (2016) 'Situation of Rokkasho, 30 years with nuclear fuel cycle', in Symposium Situation and Challenge of Aomori prefecture, Shimokita 'atomic' peninsula, Institute of Social Sciences Senshu University, pp. 8- 13. (in Japanese)

Jang, S. (2005) 'People in Gyeongju are suffered from strict regulation of cultural assets', Chosun Ilbo, 24.June [Online]. Available at: www.chosun.com/national/news/200506/200506240260.html (Accessed: 28 August 2018). (in Korean)

Kainuma, H. (2011) 'Fukushima' theory, how nuclear village was created, Tokyo: Seidosha. (in Japanese)

Kim, J. (2005a) ‘Government have to take account to regional discrimination', Media Today, 1 November [Online]. Available at: www.mediatoday.co.kr/?mod= ews&act=articleView&idxno=41360 (Accessed: 28 August 2018). (in Korean)

Lee, E. (2017) 'Opposition to cancellation of Shin Kori 5 and 6 reactors, people in Ulju show strict position', Korea Joongang Daily, 30 May [Online]. http://news.joins.com/article/21620412 (Accessed: 28 August 2018). (in Korean)

NHK (2013) 'Post-war family with nuclear power plant', Post-war witness achieve, NHK [Online]. Available at: http://cgi2.nhk.or.jp/archives/shogenarchives/postwar/shogen/movie.cgi?d... (Accessed: 28 August 2018). (in Japanese)

Sato, E. (2011) Truth of Fukushima accident, Tokyo: Heibonsha. (in Japanese)

Shimizu, S. (2014) 'Finance of nuclear generation', The Shogaku Ronshu, 82(4), pp. 121-130.

Tohoku Politics and Economics (1997) Honest talk on nuclear-depended regions, Tokyo: Toho Publishing, pp. 18-25. (in Japanese)

Ulju Development Institute (2014) 2030 Long-Term Development Plan, Ulju District, Korea (in Korean)

Ulsan Local Council (1999) Minute on industrial committee, 28 January [Online]. Available at: www.council.ulsan.kr/CLRecords/Retrieval2/index.php?hfile=2C5010017 012.html&daesu=2#w1 (Accessed: 28 August 2018). (in Korean)

Yonhap News (2016) '₩31 billion of acquisition tax by Shin Kori 3', 14 December [Online] Available at:

www.yonhapnews.co.kr/bulletin/2016/12/14/0200000000AKR20161214116500057.... (Accessed: 28 August 2018). (in Korean)

US government calls on Japan to reduce plutonium stockpiles

Nuclear Monitor Issue: 
#863
22/06/2018
Article

The US government has called on Japan to reduce its stockpiles of separated plutonium. The request was made by the US Department of State and National Security Council ahead of next month's extension of a bilateral nuclear cooperation agreement, Nikkei Asian Review reported.1

Japan can reprocess spent nuclear fuel under the Japan-U.S. Nuclear Cooperation Agreement, which is expected to be automatically extended beyond its expiration on July 16. If the two countries come to any agreement about Japan's plutonium stockpiling, it is unlikely to be included in the treaty-level Nuclear Cooperation Agreement.

Nikkei Asian Review reported that Japan's nuclear regulator is expected to adopt a policy of capping the plutonium stockpile and delaying the start-up of the Rokkasho reprocessing plant. However the start-up of Rokkasho has been delayed over 20 times and it is unclear whether serious consideration is being given to a further delay to deal with the problem of growing plutonium stockpiles.

Tokyo "will respond in good faith to the [US] request, but this will also require efforts by power companies," said a Japanese government source. "This isn't something that is going to happen overnight."1

The Asahi Shimbun newspaper reported that the Cabinet Office's Japan Atomic Energy Commission will incorporate measures to curb plutonium stockpiling in its five-point basic nuclear policy expected at the end of June; and that a reduction in plutonium stockpiles held by Japan will also be specified in the government's basic energy plan, which will be revised next month.2 The government's draft policy allows for separation of plutonium from spent fuel based on the projected amount to be used in reactors as mixed plutonium-uranium oxide fuel (MOX), Asahi Shimbun reported.

It seems that the government will pressure utilities to operate more reactors using MOX rather than conventional uranium fuel. The Federation of Electric Power Companies of Japan estimates that MOX fuel should be used at 16‒18 reactors to keep Japan's plutonium stockpile from rising.2 Of the nine reactors that have restarted in the past few years, four can use MOX fuel.2

The prospects for plutonium-fueled fast reactors could hardly be bleaker. Japan has permanently shut down the Monju fast reactor, and Japan's involvement in the planned ASTRID demonstration fast reactor in France is in doubt.3,4

Ending the reprocessing of Japan's spent fuel (currently in Europe, later at Rokkasho) would signal serious intent to address the problems associated with plutonium stockpiling (including the regional tensions and proliferations risks arising from Japan's plutonium program). But the Japanese government seems determined to go ahead with Rokkasho despite the endless delays and the mind-boggling increases in the cost estimates ‒ the latest estimate is ¥2.9 trillion (US$26.4 billion; €22.9 billion).2 Japan's Atomic Energy Commission estimated in 2011 that building Rokkasho and operating it for 40 years will cost ¥11.68 trillion (US$106 billion; €92 billion).5

Costs associated with reprocessing Japan's spent fuel in Europe are also mind-boggling. The Citizens' Nuclear Information Center reported in August 2017 that the cost of reprocessing and transporting back to Japan and managing the high level radioactive waste, which is at present overseas, is estimated at ¥13.9 trillion (US$127 billion; €110 billion) and fabrication of MOX fuel at ¥2.3 trillion (US$20.9 billion; €18.1 billion).6

(Written by Nuclear Monitor editor Jim Green.)

1. Nikkei Asian Review, 10 June 2018, 'US demands Japan reduce its plutonium stockpiles', https://asia.nikkei.com/Politics/International-Relations/US-demands-Japa...

2. Yusuke Ogawa, Rintaro Sakurai and Shinichi Sekine / Asahi Shimbun, 17 June 2018, 'Japan to cap plutonium stockpile to allay U.S. concerns',

www.asahi.com/ajw/articles/AJ201806170027.html

3. Asahi Shimbun, 31 May 2018, 'Scaling back of French reactor a blow for nuke fuel reprocessing', www.asahi.com/ajw/articles/AJ201805310040.html

4. Asahi Shimbun, 18 June 2018, 'EDITORIAL: Japan should disconnect from fast-breeder reactor project', www.asahi.com/ajw/articles/AJ201806180025.html

5. Atomic Energy Commission Bureau, 10 Nov 2011, 'Estimation of Nuclear Fuel Cycle Cost', www.aec.go.jp/jicst/NC/about/kettei/seimei/111110_1_e.pdf

6. Citizens' Nuclear Information Center, July/August 2017, 'Project Cost Estimate for the Rokkasho Reprocessing Plant', Nuke Info Tokyo No. 179, www.cnic.jp/english/?p=3903

The problems with Japan's plutonium: What are they and how do we deal with them?

Nuclear Monitor Issue: 
#863
4734
22/06/2018
Caitlin Stronell ‒ Citizens' Nuclear Information Center, Japan
Article

The Citizens' Nuclear Information Center (CNIC) recently organized a seminar with guest speaker Prof. Frank von Hippel, a nuclear physicist from Princeton University's Program on Science and Global Security, presenting alternative ways to dispose of spent fuel instead of reprocessing, as well as options for disposal of separated plutonium. After this presentation of technical solutions, a panel discussion took place. Prof. Eiji Oguma, a historical sociologist from Keio University's Faculty of Policy Management and a well-known commentator on the post-Fukushima anti-nuclear movement in Japan, pointed out the political barriers that must be overcome if any of these technical solutions were to be actually implemented, no matter how much more reasonable they may seem from economic and safety perspectives. CNIC's General Secretary, Hajime Matsukubo was also on the panel and brought into the discussion the international implications of Japan's plutonium policy including the US-Japan Nuclear Agreement.

Prof. von Hippel explained that plutonium disposal is a global problem, with more than half of the existent separated plutonium being produced as a result of civilian reprocessing, the rest produced for military purposes. Disposing of the plutonium that had been produced for weapons during the cold war has been a huge headache for the United States with planned disposal by burning it as MOX fuel in commercial reactors proving hugely expensive.

America has all but abandoned its half-built MOX plant and is now looking towards the 'dilute and dispose' option. This process would use glove boxes to mix 300 grams of plutonium oxide into a can of 'star dust' (a secret ingredient from which plutonium would be difficult to separate again). This can would then be placed in a plastic bag and another 'outer blend can.'

Another way of immobilizing plutonium is the Hot Isostatic Pressing method, which is being developed in the UK and utilizes radiation-resistant, low-solubility ceramic. After plutonium has been immobilized, it is safer to bury it underground than keep it on the surface and Prof. von Hippel mentioned the deep borehole disposal method which uses techniques developed for drilling oil and geothermal wells that can bore five kilometers into the earth. In the US, however, plans for a demonstration project of this method of radioactive waste disposal were rejected by local governments.

Prof. von Hippel stressed that the main lesson for Japan is that separated plutonium is extremely difficult to dispose of and that it is definitely better not to separate any more than is already stockpiled. Instead of sending spent fuel from the nation's nuclear power plants to Rokkasho for reprocessing, it would be safer and much cheaper and more efficient to set up dry cask storage for the spent fuel onsite at the plant. Prof. von Hippel showed us successful examples of this method in the US and suggested that there were moves in this direction in Japan as well.

Prof. von Hippel's detailed technical solutions were very convincing. Yet despite the dangers of holding such a large plutonium stockpile (47 metric tons, enough for approximately 6,000 nuclear weapons), despite the massive costs involved and despite having no concrete viable plans as to how to actually use the separated plutonium, official Japanese government policy is to continue to separate even more plutonium at the Rokkasho Reprocessing Plant, which is currently due to commence operations in 2021.

In the panel discussion which followed Prof. von Hippel's presentation, Prof. Oguma agreed that reprocessing was most certainly problematic, but, he pointed out, it will be extremely difficult to just put up onsite storage of spent fuel, no matter how reasonable a technical solution it is. Political consent must be gained from the people in communities, which will not just be hosting the nuclear power plant, but will be asked to store its radioactive waste as well. As Prof. Oguma pointed out, especially post-Fukushima Daiichi, no one trusts the Japanese Government's nuclear policy and the likelihood that they will agree to yet another imposition that can be perceived to be long-term and dangerous, is very low.

Much of the Japanese public also believes that onsite storage is merely an excuse for the nuclear industry to keep afloat. If spent fuel pools fill up, utilities will not be able to operate their plants. For many activists this is one way of closing them down, which is their main aim. Prof. Oguma argued that a minimum requirement for any form of political consent to onsite storage would be a clear commitment by the government to phase out all nuclear power by a fixed date, so that the final amount of waste can be determined and will not just keep growing, along with the burden on local people. 

This is a significant difference in perspective. Prof. von Hippel's main aim is to stop reprocessing and reduce stocks of separated plutonium, even if nuclear power generation continues, but Prof. Oguma claims that without an overall reassessment of the entire nuclear power policy it will be impossible to gain political consent for Prof. von Hippel's proposed onsite storage.

The economics is not as straightforward as it sounds either. While it is undoubtedly cheaper, in a purely mathematical sense, to simply dispose of spent fuel as waste, instead of reprocessing it and fabricating MOX fuel, the accounting systems of utilities make the more efficient alternative of direct disposal very difficult. At the moment, spent fuel is counted as an asset on utility balance sheets under the premise that it will become MOX fuel. If reprocessing is officially abandoned, all of the spent fuel 'assets' will become 'liabilities' and many utilities will be facing possible bankruptcy.

Prof. Oguma suggested that the only way to overcome all these political and economic barriers is for the government to disclose all information on nuclear power and reprocessing and to conduct an open public debate on how to proceed. If a public consensus is reached, based on all the scientific, technical and economic data available, then reprocessing should be stopped.

CNIC's Hajime Matsukubo pointed out that the Japanese government's accountability crisis was not just domestic, but international. Building up such large stocks of plutonium at huge cost and with no credible purpose inevitably makes neighboring countries suspect Japan's intentions. Indeed documents recently revealed show that the present Vice Minister of the Ministry of Foreign Affairs has long been an advocate of Japan becoming a nuclear weapons state. Japan's opposition to President Obama's proposal that the US adopt a no first-use of nuclear weapons policy, was reported in the Japanese media. Thus Japan's credibility as a strong advocator of non-proliferation is already failing and the plan to separate even more plutonium at Rokkasho could easily provoke a regional nuclear arms race, destabilizing the region, just as hopes rise that the situation in North Korea may improve.

Mr. Matsukubo also pointed out that Japan is the only non-nuclear weapons state that is permitted to separate plutonium under the US-Japan Nuclear Cooperation (123) Agreement. This creates double standards which weaken the entire global non-proliferation regime. For example, Saudi Arabia is negotiating a 123 Agreement with the US and demands that it also be allowed to reprocess spent fuel 'like Japan.'

For all of the above safety, economic and non-proliferation reasons, it would seem that there is plenty of ammunition for the movement against reprocessing. Indeed, Mr. Matsukubo said that in many ways it should be easier to stop reprocessing than stop nuclear power generation. Why hasn't this happened? As well as the difficulties mentioned by Prof. Oguma, there is also the factor that the movement against reprocessing in Japan has not been as strong as the movement against nuclear power. Reprocessing seems like a more convoluted, more removed issue, perhaps difficult for people to grasp and focus on.

All speakers agreed that the movement against reprocessing must be strengthened. The first thing that must be done to achieve this is to raise awareness and understanding regarding this issue within the broader anti-nuclear movement (both power generation and weapons) and the general public. Providing accurate information on the nuclear fuel cycle in a format that people can understand is the vital first step. As many people as possible must be informed about the costs, the dangers and the alternatives. The movement must be strong enough to demand that governments and utilities disclose all data, engage in an open debate and commit to implementing the consensus which emerges.

Prof. Oguma said that he and many other activists in Japan were committed to conveying the messages of Fukushima to the larger world, and to contributing to international solidarity on ending nuclear power. This also includes understanding how other countries see Japan. The plutonium issue is one that has particularly strong international impacts and implications and by pursuing this present policy the Japanese government is only damaging Japan's international credibility, especially regarding non-proliferation.

The seminar concluded that, whether on an international level or a domestic one, the Japanese government must restore accountability and democracy, it must formulate a responsible nuclear policy that is demonstrably safe, economic and realistic and which has the consent of the people. Viable technical alternatives to reprocessing spent fuel are available but can only be implemented through raising awareness and a change in political will, which as a movement, we must focus on with added strength.

Originally published in Citizens Nuclear Information Center, Nuke Info Tokyo, No. 184, May/June 2018, www.cnic.jp/english/?p=4135

Reactor restarts and energy policy in Japan

Nuclear Monitor Issue: 
#861
4724
28/05/2018
Jim Green ‒ Nuclear Monitor editor
Article

A Strategic Policy Committee under Japan's Advisory Committee for Natural Resources and Energy has released a draft national Strategic Energy Plan.1,2 The draft plan is likely to be endorsed by Cabinet in mid-2018, possibly with minor revisions.

The proposed electricity generation mix in 2030 is 22-24% for renewables, 20-22% for nuclear, and 56% for fossil fuels (27% LNG, 26% coal, 3% oil).1 The Strategic Energy Plan approved by Cabinet in 2014 described nuclear power as an "important base-load energy source" but did not specify growth targets.

Nuclear power is again described as an "important base-load energy source" in the latest draft energy plan, and the government will "further intensify efforts" to achieve the 20-22% nuclear target. Those efforts will include activities such as Fukushima reconstruction and restoration, nuclear power safety improvements, the creation of stable business environments, and efforts to resolve nuclear waste issues.1

Regardless of the government's commitment to the 20-22% nuclear target, it will be near impossible to achieve and would represent a six-fold leap from the current state: in 2017, nuclear accounted for just 3.6% of electricity generation.3,4

Achieving the target would require a total of about 30 operating reactors. Former World Nuclear Association executive Steve Kidd noted in March 2018: "Most assessments foresee only 20-25 reactors ever returning, and all forecasts of when, how and where exactly this will happen have so far proved wide of the mark."5

Of the 55 operable reactors before the Fukushima disaster, 16 have been permanently shut down ‒ the six Fukushima Daiichi reactors, the Monju fast breeder, and nine others (Mihama-1 and -2, Ohi-1 and -2, Ikata-1 and -2, Genkai-1, Shimane-1 and Tsuruga-1).6,7

That leaves 39 reactors, of which eight are operating: Kansai's Ohi-3 and -4 (both PWR, 1180 MW) and Takahama-3 and -4 (both PWR, 870 MW); Kyushu's Sendai-1 and -2 (both PWR, 890 MW) and Genkai-3 (PWR, 1180 MW); and Shikoku's Ikata-3 (PWR, 890 MW).8,9

Applications to restart an additional 17 reactors are slowly progressing.10 Most but not all of those 17 reactor restarts will probably proceed in the coming years. The prospects are at best uncertain for the 14 reactors that have not yet begun the slow restart approval process.

Another difficulty for the industry is the aging of the reactor fleet ‒ almost half of the current fleet of reactors are at least 30 years old.3 To get anywhere near the 20-22% target would require reactor lifespan extension approvals (from 40 years to 60 years). Takeo Kikkawa, a Tokyo University of Science academic and member of the Strategic Policy Committee, said the 2030 target would be impossible to achieve unless all remaining reactors are granted lifespan extensions, and that in the absence of lifespan extensions or new reactors Japan will have no operating reactors by 2050.11 Nuclear would account for at most 15% of electricity generation in the coming years if lifespan extensions are blocked.12

Last November, the head of the Nuclear Regulation Authority said that the pace of restarts is unlikely to gain any momentum in years to come.13 The pace of reactor restarts has in fact picked up over the past twelve months … but the number of post-Fukushima permanent shut-downs (16) doubles the number of restarts (8), and shut-downs exceed restarts (9:8) even if excluding the six Fukushima reactors and the Monju fast reactor.

Japan's Institute of Energy Economics predicts that a total of 10 reactors will have restarted by the end of March 2019.14 That prediction is dramatically lower than the Institute's wildly inaccurate prediction in July 2016 when it predicted 19 restarts by the end of March 2018 (the true number was seven).15

New reactors?

The draft proposal does not comment on the option of building new nuclear reactors, although it will be difficult to meet the 2030 target in the absence of new reactors ... and impossible to maintain it in subsequent decades without them. Strategic Policy Committee chair Masahiro Sakane described new build as the "inconvenient truth" from which the government averted its eyes.11 In June 2017, Japan's trade minister said the government is not considering building new nuclear plants and denied a media report claiming otherwise.16

Tentative steps are being taken to secure approval to complete two reactors that were under construction before the Fukushima disaster (Shimane-3 and Ohma-1 a.k.a. Oma-1).17,18 The government does not deem the two reactors as "new or additional" as construction started before the Fukushima disaster.19 That logic was lost on 1,100 citizens who took legal action to prevent the Ohma reactor project going ahead ‒ but their case was rejected in the Hakodate District Court.20,21

Leaving aside the two partially-built reactors, the obstacles to new reactor projects are mind-boggling. The obstacles include public and political opposition12, and the severe financial pressures facing Japan's energy companies. Another obstacle is that the industrial and technological capacity to build new reactors has withered in Japan. There has been only one reactor grid-connection in Japan in the past decade, and only five in the past 21 years.3

Nikkei Asian Review reported in April 2017 (before Toshiba exited the reactor construction business):22

"The three major Japanese reactor makers ‒ Hitachi, Mitsubishi Heavy Industries and Toshiba ‒ are seeking to keep their nuclear power business afloat by generating profit from work intended to boost the safety of existing plants.

"They have no choice because no new reactor has begun operation since the No. 3 unit at the Tomari nuclear plant in Hokkaido, Japan's northernmost island, came onstream in 2009. "We have also stopped our efforts to transfer skills and expertise to younger generations of employees," said a senior executive at a major reactor maker.

"The situation also bodes ill for suppliers of reactor parts. The construction of one reactor requires the involvement of anywhere between 300 and 500 suppliers possessing special technologies. "It is not easy to regain technology once it is lost," warned Juichiro Takada, president of Takada, a Kitakyushu, Fukuoka Prefecture-based company in southwestern Japan that has supplied storage tanks and done piping work for many nuclear plants. The company has not been involved in construction work for any new reactor since the Oma project was suspended."

Exports

Japan's reactor manufacturing capabilities might be revived with contracts to build in other countries (and perhaps in Japan in the longer-term). The draft Strategic Energy Plan reiterates the Abe administration's policy of promoting nuclear exports.2

But Japan's nuclear export prospects are shaky at best. Japan Times reported in February 2017 that Japanese firms have attempted "with little success" to sell their technologies to countries as diverse as France, Vietnam, India, Turkey, Hungary, Poland, Slovakia, the Czech Republic and the United Arab Emirates.23 Japan Times further noted that in June 2016 Toshiba said its goal was to win orders for 45 or more overseas reactors by 2030 … but the company has exited the reactor construction business.

Hitachi is seeking extraordinary financial backing from both the Japanese and UK governments before committing to building advanced boiling water reactors in Wales (the Wylfa project).24 Mitsubishi Heavy Industries is slowly progressing plans to build reactors in Turkey but another Japanese company, Itochu Trading House, recently pulled out of the project.24

Pro-nuclear commentator Dan Yurman wrote on May 7:24

"The biggest black eye that Japan has gotten in recent years isn't from cleanup troubles at Fukushima, but from the multi-billion dollar cost overruns at the V C Summer site [in South Carolina] where Toshiba's Westinghouse ran the project into the ground with self-inflicted management failures. Toshiba sold the Westinghouse business unit in February unloading it for $1 billion less than it paid to purchase the firm ten years ago.

"Japan has also been pushed out of an opportunity to provide four full size nuclear reactors to Vietnam. In fairness, that country also cancelled similar plans to acquire four Russian nuclear reactors. The country cancelled all of its plans for nuclear power stations in November 2016. The main reasons were fears about costs and the inability of the government to stand up a nuclear safety agency, a regulatory framework, and capability to oversee a construction project involving eight 1000 MW nuclear reactors.

"Japan needs a "win" to get back in the game, and the Sinop project in Turkey is its best chance to get one. Putting together a workable cost and schedule package that can be sold to investors is a big challenge. The country's future in exporting nuclear energy technologies depends on it."

Tom Corben wrote in The Diplomat last December: "Many of Turkey’s largest earthquakes have occurred uncomfortably close to the Sinop site, and seismic safety assessments conducted by Japanese government-commissioned research firms have produced questionably optimistic results. The European Parliament has already called on Turkey to abandon the construction of another reactor complex at Akkuyu due to the risk of a serious industrial-environmental disasters, and there is arguably a similar risk at Sinop. An accident there would present Tokyo with complex moral and legal questions, and discredit Japanese nuclear technology."25

Corben also noted that Japan's willingness to supply India's nuclear power program is problematic: "Meanwhile, as a non-signatory to the Nuclear Non-Proliferation Treaty, the ambiguous nature of assurances from the Indian government that Japanese technology will not be used to produce nuclear weapons is worrying, as is the lack of legal definition around the circumstances in which Japan may justifiably abandon the deal."25

References:

1. Noriyuki Ishii, 8 May 2018, ' Draft of Revised Strategic Energy Plan Aims for Firm Implementation of 2030 Energy Mix, Eyeing 2050 As Well', www.jaif.or.jp/en/draft-of-revised-strategic-energy-plan-aims-for-firm-i...

2. Shinichi Sekine and Rintaro Sakurai / Asahi Shimbun, 14 May 2018, '20-22% share of nuclear power at core of updated energy policy', www.asahi.com/ajw/articles/AJ201805140045.html

3. www.iaea.org/PRIS/CountryStatistics/CountryDetails.aspx?current=JP

4. Takashi Tsuji, 20 Oct 2017, 'Japan's aging fleet of reactors spell trouble for energy blueprint', https://asia.nikkei.com/Politics-Economy/Economy/Japan-s-aging-fleet-of-...

5. Steve Kidd, 7 March 2018, 'Operating reactors - can they still compete?', www.neimagazine.com/opinion/opinionoperating-reactors---can-they-still-c...

6. World Nuclear Association, 22 Dec 2017, 'Kansai opts to retire older Ohi units', www.world-nuclear-news.org/WR-Kansai-opts-to-retire-older-Ohi-units-2212...

7. Noriyuki Ishii, 29 March 2018, 'Ikata-2 NPP to Be Decommissioned – Would Not be Profitable Beyond Forty Years', www.jaif.or.jp/en/ikata-2-npp-to-be-decommissioned-would-not-be-profitab...

8. World Nuclear Association, 14 May 2018, 'Eighth Japanese reactor resumes power generation', www.world-nuclear-news.org/C-Eighth-Japanese-reactor-resumes-power-gener...

9. Japan Atomic Industrial Forum, 28 March 2018, 'Thoughts on the Resumption of Operation at the Ohi-3 and Genkai-3 NPPs', www.jaif.or.jp/en/thoughts-on-the-resumption-of-operation-at-the-ohi-3-a...

10. www.world-nuclear.org/information-library/country-profiles/countries-g-n...

11. Mari Yamaguchi / Associated Press, 16 May 2018, 'Japan draft plan sets ambitious targets for nuclear energy', https://gazette.com/japan-draft-plan-sets-ambitious-targets-for-nuclear-...

12. Nikkei Asian Review, 9 June 2017, 'Japan may call for more nuclear plants down the road', http://asia.nikkei.com/Politics-Economy/Policy-Politics/Japan-may-call-f...

13. Greg Peel, 14 Nov 2017, 'Uranium Week: Break Out!', www.fnarena.com/index.php/2017/11/14/uranium-week-break-out/

14. World Nuclear Association, 3 Aug 2017, 'Japan to benefit from reactor restarts, says IEEJ', www.world-nuclear-news.org/NP-Japan-to-benefit-from-reactor-restarts-say...

15. World Nuclear Association, 28 July 2016, 'Japanese institute sees 19 reactor restarts by March 2018', www.world-nuclear-news.org/NP-Japanese-institute-sees-19-reactor-restart...

16. Reuters, 8 June 2017, 'Japan Minister Denies Government Considering New Nuclear Plants', www.usnews.com/news/world/articles/2017-06-08/japan-to-consider-building...

17. Asahi Shimbun, 22 May 2018, 'Process begins at Shimane nuclear plant to operate new reactor', www.asahi.com/ajw/articles/AJ201805220043.html

18. World Nuclear Association, 22 May 2018, 'Japanese utility seeks to start up new reactor', www.world-nuclear-news.org/RS-Japanese-utility-seeks-to-start-up-new-rea...

19. Asahi Shimbun, 1 Nov 2014, 'Nuclear operators push to open new plant, extend life of aging reactors', http://ajw.asahi.com/article/0311disaster/fukushima/AJ201411140068

20. Reuters, 19 March 2018, 'Japan court rejects lawsuit against construction of nuclear plant', https://uk.reuters.com/article/us-japan-nuclear-lawsuit/japan-court-reje...

21. World Nuclear Association, 19 March 2018, 'Court rules against bid to halt Ohma construction', www.world-nuclear-news.org/RS-Court-rules-against-bid-to-halt-Ohma-const...

22. Nikkei Asian Review, 10 April 2017, 'Japan's nuclear technology faces extinction', http://asia.nikkei.com/Business/Trends/Japan-s-nuclear-technology-faces-...

23. Eric Johnston, 15 Feb 2017, 'Toshiba’s woes weigh heavily on government’s ambition to sell Japan’s nuclear technology', www.japantimes.co.jp/news/2017/02/15/national/toshibas-woes-weigh-heavil...

24. Dan Yurman, 7 May 2018, 'Japan's Plans for Nuclear Exports Hit Speed Bumps', https://neutronbytes.com/2018/05/07/japans-plans-for-nuclear-exports-hit...

25. Tom Corben, 22 Dec 2017, 'Japan’s Nuclear Exports: Risky Business', https://thediplomat.com/2017/12/japans-nuclear-exports-risky-business/

Fukushima Fallout ‒ Updates from Japan

Nuclear Monitor Issue: 
#859
4713
15/03/2018
Article

Seven years after the Fukushima disaster, an estimated 50,000 of the 160,000 evacuees remain dislocated. Six reactors are operating (compared to the pre-Fukushima fleet of 54), and 14 reactors have been permanently shut-down since the Fukushima disaster (including the six Fukushima Daiichi reactors). Decontamination of Fukushima Prefecture is slow and partial. Decommissioning the Fukushima Daiichi reactor plant will take decades. Official estimates of the clean-up and compensation costs stand at US$202 billion and will rise further.

50,000 Fukushima residents still displaced

Some 73,000 people ‒ two-thirds (50,000) of them former Fukushima Prefecture residents ‒ remain displaced on the seventh anniversary of the Great East Japan Earthquake, tsunami and nuclear disaster, according to the Reconstruction Agency. About 53,000 people are living in prefabricated temporary housing, municipality-funded private residences, or welfare facilities. Nearly 20,000 are staying with relatives or friends.

Although roads, railways and homes have been rebuilt in the stricken Tohoku region, the outflow of population continues from devastated areas, particularly from coastal communities. Iwate, Miyagi and Fukushima prefectures ‒ the three hardest-hit prefectures ‒ saw a combined decline in population of 250,000, compared with pre-disaster levels.

In Fukushima Prefecture, the evacuation order for four municipalities that were exposed to high levels of radiation from the Fukushima No. 1 nuclear power plant accident was lifted about a year ago. But not many residents are returning to live in their hometowns.

Asahi Shimbun, 11 March 2018, 'Over 70,000 still living elsewhere from 2011 quake and tsunami', www.asahi.com/ajw/articles/AJ201803110022.html

NHK, 7 March 2018, 'Evacuees from 2011 disaster number over 73,000', https://www3.nhk.or.jp/nhkworld/en/news/20180307_34/

Japanese government agrees to recommendations on the rights of evacuees

The Japanese government announced in early March that it had accepted all recommendations made at the United Nations Human Rights Council (UNHRC) on the rights of evacuees from the Fukushima Daiichi nuclear accident. The decision is a victory for the human rights of tens of thousands of evacuees, and civil society that have been working at the UNHRC and demanding that Japan accept and comply with UN principles. The decision means that the Japanese government must immediately change its unacceptable policies, said Greenpeace.

"I cautiously welcome the Japanese government's acceptance of the UN recommendations. The government may believe that an insincere acceptance is sufficient. They are wrong to think so – and we are determined to hold them to account to implement the necessary changes that the UN members states are demanding," said Yuichi Kaido, a lawyer for multiple Fukushima accident lawsuits against TEPCO and the Japanese government.

Greenpeace radiation survey results published recently showed high levels of radiation in Iitate and Namie that make it unsafe for citizens to return before mid-century, and even more severe contamination in the exclusion zone of Namie. High radiation levels in Obori would mean you would reach exposure of 1 millisievert (mSv) in just 16 days.

The lifting of evacuation orders in areas heavily contaminated by the nuclear accident, which far exceed the international standard of 1 mSv/year for the general public, raise multiple human rights issues. Housing support is due to end in March 2019 for survivors from these areas. The Japanese government also ended housing support for so-called 'self evacuees' from other than evacuation order zone in March 2017, and removed as many as 29,000 of these evacuees from official records. This amounts to economic coercion where survivors may be forced to return to the contaminated areas against their wishes due to economic pressure. This clearly contravenes multiple human rights treaties to which Japan is party.

Greenpeace Japan, 8 March 2018, 'Japanese government accepts United Nations Fukushima recommendations - current policies now must change to stop violation of evacuee human rights', www.greenpeace.org/japan/ja/news/press/2018/pr20180308/

Water worries

A costly "ice wall" is failing to keep groundwater from seeping into the stricken Fukushima Dai-ichi nuclear plant, data from operator Tokyo Electric Power Co shows. When the ice wall was announced in 2013, TEPCO assured skeptics that it would limit the flow of groundwater into the plant's basements, where it mixes with highly radioactive debris from the site's reactors, to "nearly nothing."

However, since the ice wall became fully operational at the end of August 2017, an average of 141 metric tonnes a day of water has seeped into the reactor and turbine areas, more than the average of 132 metric tonnes a day during the prior nine months, a Reuters analysis of the TEPCO data showed.

A government-commissioned panel offered a mixed assessment of the ice wall, saying it was partially effective but more steps were needed.

The groundwater seepage has delayed TEPCO's clean-up at the site and may undermine the entire decommissioning process for the plant.

Though called an ice wall, TEPCO has attempted to create something more like a frozen soil barrier. Using 34.5 billion yen (US$324 million) in public funds, TEPCO sunk about 1,500 tubes filled with brine to a depth of 30 meters (100 feet) in a 1.5-kilometre (1-mile) perimeter around four of the plant's reactors. It then cools the brine to minus 30 degrees Celsius (minus 22 Fahrenheit). The aim is to freeze the soil into a solid mass that blocks groundwater flowing from the hills west of the plant to the coast.

Other water control measures have been more successful. TEPCO says a combination of drains, pumps and the ice wall has cut water flows by three-quarters, from 490 tons a day during the December 2015 to February 2016 period to an average of 110 tons a day for December 2017 to February 2018.

The continuing seepage has created vast amounts of toxic water that TEPCO must pump out, decontaminate and store in tanks at Fukushima that now number 1,000, holding 1 million tonnes. TEPCO says it will run out of space by early 2021 and must decide how to cope with the growing volume of water stored on site. The purification process removes 62 radioactive elements from the contaminated water but it leaves tritium, a mildly radioactive element that is difficult to separate from water. A government-commissioned taskforce is examining five options for disposing of the tritium-laced water, including ocean releases, though no decision has been made.

Abridged from: Aaron Sheldrick and Malcolm Foster, 8 March 2018, 'Tepco's 'ice wall' fails to freeze Fukushima's toxic water buildup', www.reuters.com/article/us-japan-disaster-nuclear-icewall/tepcos-ice-wal...

Legal fallout

Legal fallout from the March 2011 accident at Fukushima Daiichi Nuclear Power Station continues, as dozens of lawsuits and injunctions make their way through Japan's judicial system. The final rulings could have a profound impact on the government's energy policy and approach to risk mitigation.

Court cases stemming from the meltdown at Fukushima Daiichi can be divided broadly into two categories. In the first are efforts to assign responsibility for the accident, including one high-profile criminal case and numerous civil suits by victims seeking damages from the government and owner-operator Tokyo Electric Power Company. The second group consists of lawsuits and injunctions aimed at blocking or shutting down operations at plants other than Fukushima Daiichi (whose reactors have been decommissioned) on the grounds that they pose a grave safety threat.

Shizume Saiji / Nippon, 12 March 2018, 'Nuclear Power Facing a Tsunami of Litigation', www.nippon.com/en/currents/d00388/

Firm admits nuclear waste data falsification

Sixteen pieces of data relating to the underground disposal of highly radioactive waste, which scandal-hit Kobe Steel Ltd. and a subsidiary analyzed at the request of the Japan Atomic Energy Agency (JAEA), were falsified, forged or flawed in other ways, the nuclear research organization said.1,2

The tests are designed to examine what happens to metal cladding tubes that had previously contained spent nuclear fuel when they are disposed of deep underground, including possible corrosion and by-products of gas, according to the Nuclear Regulation Authority (NRA). A report the NRA received from the JAEA said that figures in the original data and those in reports submitted by Kobe subsidiary Kobelco did not match. Furthermore, some original data could not be located.

The NRA outsourced the testing to the JAEA in fiscal 2012 through fiscal 2014 at a cost of about 600 million yen (US$5.59 million). Kobelco was subcontracted to undertake some of the tests for about 50 million yen.

Kobe Steel admitted in October 2017 to rewriting inspection certificates for some of its products and other misconduct.3 Deliveries to nuclear power facilities were affected by these scandals. One case involved replacement pipes that were scheduled to be used in a heat exchanger of a residual heat removal system at Fukushima Daini Unit 3. Another involved centrifuge parts that had not yet been used at the Rokkasho uranium enrichment plant.

1. Mainichi Japan, 7 March 2018, 'Kobe Steel also falsified data on analyses of burying radioactive waste', https://mainichi.jp/english/articles/20180307/p2a/00m/0na/017000c

2. Masanobu Higashiyama, 15 Feb 2018, 'Kobe Steel firm suspected of nuclear waste data falsification', www.asahi.com/ajw/articles/AJ201802150026.html

3. Citizens Nuclear Information Center, Nuke Info Tokyo No.181 Nov./Dec. 2017, www.cnic.jp/english/?p=4007

Stop public funds for Japanese nuclear plant in Wales

Horizon Nuclear Power, a wholly owned subsidiary of Japanese electronics giant Hitachi Ltd., is attempting to construct a 2.7 gigawatt nuclear power plant in Wylfa, on the scenic and historic island, Anglesey, Wales, in the UK. The project cannot proceed without public financial support, and the Japanese government is orchestrating an "all-Japan" support system to secure its financing, backed up by public money.

Friends of the Earth Japan is working with local groups in Wales to stop the nuclear project and calls on individuals and organizations around the world to sign the petition posted at www.foejapan.org/en/energy/doc/180307.html

Japanese government releases map showing areas "suitable" for high-level nuclear waste disposal

Nuclear Monitor Issue: 
#852
4685
11/10/2017
Hideyuki Ban ‒ Co-Director of the Citizens Nuclear Information Center, Tokyo.
Article

On July 28, 2017, the Japanese government released a geoscientific characteristics map to provide a basis for selecting locations for high-level nuclear-waste disposal sites. The map, on a 1:2,000,000 scale, shows the entire Japanese archipelago, accompanied by five aerial maps. The explanations of the standpoints used to evaluate aerial favorability for site construction are provided, along with the criteria for those standpoints, accompanied by the maps, which use color-coding to indicate individual standpoints.

The map divides the nation into four colors. The areas unfavorable from the standpoint of the stability of deep underground strata are colored in orange; the areas unfavorable because of the possibility of excavation for mineral resources in silver; the areas having favorable characteristics in pale green; and the areas that are additionally favorable in terms of transportation convenience in dark green (these areas are called green coastal areas).

In Japan, an act concerning the deep geological disposal of high-level nuclear wastes was established in 2000. It stipulates the methods of selecting disposal sites based on a stepwise approach, and the Nuclear Waste Management Organization (NUMO) was established as the organization that is taking the initiative in selecting the sites and carrying out the disposal process. The stepwise approach consists of three steps; a literature survey, a general survey, and a detailed survey. NUMO, established mainly by electric power companies, encouraged municipalities across the nation (about 3,500 in total at that time) to apply for a literature survey.

However, all the municipalities that showed an interest in application later abandoned the idea due to strong protest. In 2007, Toyo Town, Kochi Prefecture, which was the only municipality that managed to submit an application, was obliged to withdraw it because of strong protest that demanded the recall of the town mayor. After this event, the government judged that the site selection process would not go forward if it continued to wait passively for applications, and thus adopted a second approach for use in parallel to the passive approach ‒ it decided to look for municipalities and encourage them to apply for a literature survey.

Thereafter the government used every opportunity to exchange opinions with many municipalities, and in spring 2011, it was prepared to request about 10 municipalities which had showed an interest to accept a literature survey. However, the Fukushima Daiichi NPS accident occurred immediately before the delivery of the request. The government became unable to pursue this plan any further, and the entire attempt to encourage municipalities to apply collapsed.

The municipalities' interest had been attracted by government money, which were to be paid in return for their acceptance of the survey. After the Fukushima Daiichi accident, public criticism against nuclear power increased. Under such conditions, the government realized that gaining municipalities' interest would not be sufficient and that it would be necessary to show scientific reasons to justify the survey. In 2013, the government devised another approach, which was firstly to show the geoscientific characteristics of individual areas, secondly to identify the areas that could possibly host a disposal site, and thirdly to encourage municipalities that might be interested to accept a literature survey. It was the first time the government had adopted such an attempt.

The geoscientific characteristics map was created in this context. The map color codes indicate the areas judged unfavorable from a set of standpoints ‒ volcanic activity, fault activity, upheaval, denudation, geothermal activity, bedrock hardness, the ranges influenced by pyroclastic flows, and prospective mineral resources. The areas judged favorable in terms of transportation (about 20 km from the shore) are also color-coded. Based on these standpoints, the archipelago is color-coded in four colors. The geological conditions specific to each area will be examined in the literature survey, with reference to geological records, while the characteristics map shows the divisions based only on the information available nationwide.

Therefore, while the map is called a geoscientific characteristics map, the characteristics specific to individual areas are not always reflected. As an example, the map is supposed to exclude areas having pyroclastic flow deposits younger than 10,000 years as not favorable, but the map does not consider the range of influence of the pyroclastic flow from a possible eruption of the Kikai Caldera Volcano, Kagoshima Prefecture, the most recent eruption of which was 7,300 years ago. This influence will be considered in the literature survey. Many areas in Tokyo are classified in the green coastal areas, but because the Kanto Plain was formed during the Quaternary period, the bedrock is still soft deep underground, and there may be many unlithified rocks. This should also be considered in the literature survey.

This geoscientific characteristics map does not consider restraints in the use of land due to legislation or international treaties, nor social conditions such as population density and the number of landowners.

NUMO's conventional conditions for the acceptance of survey applications were only volcanic activity and fault activity. The other standpoints are included in the social characteristics map scheduled to be examined in the literature survey. Therefore, the release of the map is a step forward for the government. NUMO is modifying the acceptance conditions in order to be consistent with the conditions described in the map.

The Japanese archipelago lies in the tectonic movement zone, where four plates meet. Even if all the conditions presented in the map are satisfied, it would still be difficult to isolate wastes from the environment for more than 100,000 years. Especially, information on relatively large amounts of deep underground water, which should essentially be considered for long-term stability, is limited. The government intends to ensure the long-term safety of high-level waste (HLW) by using engineering methods, and this governmental intention remains unchanged.

After the release of the geoscientific characteristics map, the government and NUMO intend to promote activities to gain public understanding, mainly in the areas whose characteristics have been judged favorable (green coastal areas). However, of the 47 prefectures nationwide, 20 prefectures have already turned down the survey. Citizens' movements against nuclear power generation have been powerful since the Fukushima Daiichi accident, and the movement strongly demands that all nuclear power plants be shut down first in order to halt the accumulation of HLW. The Science Council of Japan also stated that the upper limit of HLW should be determined (2012). However, the government and NUMO intend to promote the conventional concept and plan of geological waste disposal, separating the disposal site issue from the controversy of nuclear power plants. This head-on disagreement is expected to continue.

The government does not make efforts to form a participatory consensus concerning the treatment of HLW. As an example, consensus meetings or deliberative polls have not been conducted and are not planned. The government councils did not discuss ways in which to obtain social agreement. What the government has attempted to do thus far is to try to earn public agreement for its geological disposal policy. However, what it has actually been engaged in is organizing gatherings that attempt to obtain public agreement for the government's plan, under the name of explanatory hearings.

The government's stance concerning the new characteristics map is that its release is not intended to persuade municipalities to accept a survey for disposal site selection; the government says that it will not initiate any survey unilaterally without gaining the agreement of the locals. According to the government, "this is the first step in a long road to realize final HLW disposal."

NUMO plans to begin the first step by organizing dialogue gatherings with a small number of people in the areas judged favorable from all the standpoints including transportation. NUMO said that it would release the schedule of dialogue gatherings, but to date, it has not been released. It is not known when the schedule will be announced, but from October this year, the government and NUMO plan to hold explanatory hearings about the geoscientific characteristics map in 45 prefectures. With publicly invited participants, the gatherings will be used by the government to explain the map during the first half of the hearings, and during the second half the participants will be divided into small groups to exchange opinions with NUMO. Through this group dialogue, NUMO expects to exploit human resources who can work proactively to invite the site to the area.

While the geoscientific characteristics map has been made public, when literature surveys will begin is unknown, and the issue of disposal site selection is expected to confront many problems.

Reprinted from Nuke Info Tokyo No. 180, Sept/Oct 2017, www.cnic.jp/english/?p=3956

Fukushima Fallout: Updates from Japan

Nuclear Monitor Issue: 
#850
4679
07/09/2017
Article

Cabinet accepts nuclear policy guidance document

Decommissioning plans for Tokai Reprocessing Plant
Rokkasho Reprocessing Plant

Japan's intentional plutonium surplus

Slow progress on high-level waste disposal

Trial begins for children of Hibakusha
First court day of TEPCO executives criminal trial

More Fukushima law suits

Mental health afflictions for Fukushima first responders

Radioactive particles in northern Japan

Japan rates severity of Oarai nuclear exposure accident as level 2

Cabinet accepts nuclear policy guidance document

Japan's cabinet approved a draft Basic Concept on Nuclear Energy Use developed by the Japan Atomic Energy Commission (JAEC) in mid-July.1 The policy derives from expert consultations stretching back two years, and a public consultation phase earlier this year which resulted in 728 comments.1 The draft Basic Concept describes "the need to use nuclear energy in an appropriate manner by thoroughly managing risk under a responsible system", according to the Japan Atomic Industrial Forum.1

The process was a sham. A JAEC committee met on 18 July to discuss the public 728 comments, completed the draft Basic Concept on July 20, and Cabinet approved it the following day.

Meanwhile, the industry ministry has opened discussions on a review of Japan's Strategic Energy Plan.2 And again, it seems the outcome has been predetermined. Industry minister Hiroshige Seko said the plan will remain basically unchanged.2 An overwhelming majority of the members of two bodies considering the Strategic Energy Plan are supportive of current government policy whereas advocates of a shift away from nuclear power and of intensive development of renewable energy account for "a mere handful of their members" according to a recent Asahi Shimbun editorial.2

The current Strategic Energy Plan, approved by the Cabinet in 2014, contains a "deceptive aspect", the Asahi Shimbun editorial noted ‒ the plan says that "Japan will minimize its dependency on nuclear power" but it also defines nuclear power as an "important base-load power source."2 The Abe government is doing its best to promote nuclear power, not to minimize its use.

The Long-Term Energy Supply and Demand Outlook, a document produced by the industry ministry in 2015, is more openly pro-nuclear and assumes that nuclear power will account for about 20‒22% percent of Japan's total electricity supply by 2030.2 That figure translates to around 30 operating reactors.

Only five power reactors are currently operating ‒ Sendai 1 and 2, Takahama 3 and 4, and Ikata 3.3 Another five will restart by March 2019 according to the latest estimate by Japan's Institute of Energy Economics.3 The Institute has dramatically lowered its expectations for reactor restarts: in its previous outlook, it anticipated that 19 reactors would be operating by March 2018.3

The 20‒22% target by 2030 may not be attainable, no matter how hard the government pushes.

1. World Nuclear News, 25 July 2017, 'Japan accepts nuclear policy guidance document', www.world-nuclear-news.org/NP-Japan-accepts-nuclear-policy-guidance-docu...

2. Asahi Shimbun, 14 Aug 2017, 'Editorial: Phasing out nuclear power a must for Japan's new energy plan', www.asahi.com/ajw/articles/AJ201708140020.html

3. World Nuclear News, 3 Aug 2017, 'Japan to benefit from reactor restarts, says IEEJ', www.world-nuclear-news.org/NP-Japan-to-benefit-from-reactor-restarts-say...

Decommissioning plans for Tokai Reprocessing Plant

The Japan Atomic Energy Agency applied to the Nuclear Regulation Authority on June 30 for approval of its plans for decommissioning the Tokai Reprocessing Plant. The plant is located in Tokai Village, Ibaraki Prefecture. It was test operated in 1977, and began full operation in 1981, but its utilization rate stagnated. It processed a total of 1,140 tons of spent nuclear fuel (equal to 5.4 years of its claimed processing capacity). The decision to decommission the plant was made in 2014.

The decommissioning will take about 70 years to complete, at a total cost of about ¥1 trillion (US$9.1 billion; €7.8 billion) plus additional costs for waste disposal. That is over five times the cost of its construction, which was about ¥190 billion.

Furthermore, the vitrification of high-level wastes has continued to be fraught with problems, resulting in delays. In addition, the plant is storing 265 spent fuel assemblies from the Fugen Prototype Advanced Thermal Reactor in a pool. Those are to be shipped to France, but that has yet to be actualized.

Citizens Nuclear Information Center, July/August 2017, Nuke Info Tokyo No. 179, www.cnic.jp/english/?p=3903

Rokkasho Reprocessing Plant

The 800 tons/year Rokkasho reprocessing plant has been repeatedly delayed and cost estimates have been repeatedly revised upwards. Currently, the cost estimate is ¥2.94 trillion (US$26.8 billion; €22.8 billion) and start-up is anticipated in 2018.

World Nuclear Association, 31 July 2017, 'Japan's Nuclear Fuel Cycle', www.world-nuclear.org/information-library/country-profiles/countries-g-n...

Japan's intentional plutonium surplus

Alan J. Kuperman ‒ associate professor and coordinator of the Nuclear Proliferation Prevention Project (www.NPPP.org) at the University of Texas, Austin ‒ writes in an opinion piece published by Kyodo News:

"Japan owns nearly 50 tons of separated plutonium. That is enough for over 5,000 nuclear weapons. Yet Japan has no feasible peaceful use for most of this material. This raises an obvious question: How did a country that forswears nuclear arms come to possess more weapons-usable plutonium than most countries that do have nuclear arsenals?

"Some argue it is the unforeseen consequence of unexpected events, such as the failure of Japan's experimental Monju breeder reactor, or the Fukushima accident that compelled Japan to shut down traditional nuclear power plants. ...

"But that is false. Japan's massive accumulation of nuclear weapons-usable plutonium was foreseen three decades ago. In testimony submitted to the U.S. Congress in March 1988, and published that year, Dr. Milton Hoenig of the Nuclear Control Institute ‒ where I worked at the time ‒ documented how Japan's planned separation of plutonium from spent fuel greatly exceeded its planned recycling of such plutonium in fresh fuel. The inevitable result, he predicted, was that Japan would accumulate enormous amounts of separated plutonium. ...

"The hard truth is that creation of a plutonium surplus was not an accident but the inevitable consequence of Japanese nuclear policy that the U.S. government acquiesced to in 1988. Why did Japan intentionally acquire a stockpile of plutonium sufficient for thousands of nuclear weapons? Neighboring countries suspect it is to provide Japan the option of quickly assembling a large nuclear arsenal. Not surprisingly, both China and South Korea are now pursuing options to separate more plutonium from their own spent nuclear fuel.

"Three urgent steps are necessary to avert this latent regional arms race. First, Japan should terminate its Rokkasho plant, which is an economic, environmental, and security disaster. The last thing Japan needs is more surplus plutonium. Second, the United States and Japan should seize the opportunity of their expiring 1988 deal to renegotiate new terms restricting plutonium separation, which could also serve as a model for ongoing U.S.-South Korea nuclear negotiations.

"Finally, innovative thinking is needed to shrink Japan's plutonium stockpile. In light of the worldwide failure of breeder reactors, and post-Fukushima constraints on traditional reactors, most of Japan's plutonium will never become fuel. Instead, it should be disposed of as waste. The U.S. government has recently made a similar decision, abandoning plans to use recovered weapons plutonium in fuel and instead intending to bury it. U.S.-Japan collaboration to dispose of surplus plutonium in a safe, secure and economical manner could help make up for the misguided bilateral decisions that created this problem 30 years ago."

Alan J. Kuperman, 17 Aug 2017, 'Opinion: Japan's intentional plutonium surplus', https://english.kyodonews.net/news/2017/08/39a5a7121fcf-opinion-japans-i...

Slow progress on high-level waste disposal

On 28 July 2017, the Nuclear Waste Management Organization of Japan (NUMO) published a 'Nationwide Map of Scientific Features for Geological Disposal' of high-level nuclear waste, categorizing all areas in Japan into four categories: (1) areas with unfavorable geological features such as volcanoes and active geological faults, (2) unfavorable areas endowed with natural resources, (3) areas with a good chance of having favorable characteristics and (4) areas with a good chance of having favorable characteristics and also favorable from the viewpoint of transportation.1

Areas that might be suitable account for roughly 65% percent of the nation's land and cover more than 80% of the nation's 1,800 municipalities. Areas that might be suitable and also lie within 20 km from a coastline (thus facilitating transportation) cover 30% percent of Japan's land and about 900 municipalities.2

NUMO said that publication of the map is the "first step on the long road toward the decision of the site."1 NUMO expects site selection from about 2025, with repository operation from about 2035.3 Of course, that timeline is unrealistic. Japan Times suggested a timeframe of 50 years and said that the METI bureaucrats and nuclear industry executives will be long dead before the project reaches fruition.4

Getting local governments to offer land for disposal sites is going to be "very difficult" as Japan Times noted, even though participation comes with rewards: ¥2 billion for an initial two-year data study and ¥7 billion for a follow-up study.4 Previous attempts to bribe local communities to offer land for evaluation for a dump failed ‒ one mayor expressed interest in 2007, and was removed from office in the next election.5

The total cost of the waste repository project is estimated at approximately ¥3.7 trillion (US$34 bn; €28.5 bn), excluding financial compensation paid to local communities.3,6 This will be met by funds accumulated at 0.2 yen/kWh from electricity utilities and paid to NUMO, World Nuclear News reported.3 But by 2015, only ¥1 trillion had been collected ‒ a little more than a quarter of the estimated requirement.3

There has been little public discussion about what happens to spent nuclear fuel if reprocessing is abandoned, though a "feasibility study" reportedly began in April 2017.5

1. Nuclear Waste Management Organization of Japan (NUMO), 28 July 2017, 'On the publication of the "Nationwide Map of Scientific Features for Geological Disposal"', www.numo.or.jp/en/what/topics_170801.html

2. Japan Times, 3 Aug 2017, 'Finding sites to bury high-level radioactive waste', www.japantimes.co.jp/opinion/2017/08/03/editorials/finding-sites-bury-hi...

3. World Nuclear News, 28 July 2017, 'Japan maps potential repository areas', www.world-nuclear-news.org/WR-Japan-maps-potential-repository-areas-2807...

4. Philip Brasor, 12 Aug 2017, 'METI seeks to pass nuclear buck with release of waste disposal map', www.japantimes.co.jp/news/2017/08/12/national/media-national/meti-seeks-...

5. Mari Yamaguchi / AP, 15 July 2017, 'Underground lab tackles trouble-plagued nuclear waste issue', www.japantimes.co.jp/news/2014/07/15/national/underground-lab-tackles-tr...

6. Nuclear Waste Management Organization of Japan (NUMO), 'Questions and Answers for NUMO's Geological Disposal Program', ww.numo.or.jp/en/faq/main1.html, accessed 30 Aug 2017

Trial begins for children of Hibakusha

The first round of oral proceedings got underway in the Class Action Suit Seeking Assistance for Second Generation Hibakusha (atomic bomb survivors) on May 9 in the Hiroshima District Court and on June 5 in the Nagasaki District Court. The suit, lodged by 47 plaintiffs, seeks a token payment as compensation for mental suffering incurred by second-generation hibakusha. This sum is not intended as compensation for damages, but to make it clear to society through the lawsuit that the problem exists. There are 300,000 to 500,000 second-generation hibakusha living throughout Japan, and they have to live with uncertainty over the genetic effects of atomic bomb radiation. In the first round of oral proceedings in both district courts, the plaintiffs described their health concerns and actual health damage, seeking a ruling that would lead to legal assistance, while the state sought to have their request dismissed.

Citizens Nuclear Information Center, July/August 2017, Nuke Info Tokyo No. 179, www.cnic.jp/english/?p=3903

First court day of TEPCO executives criminal trial

The first day of the court case against former TEPCO executives Tsunehisa Katsumata, Ichiro Takekuro and Sakae Muto for professional negligence leading to fatalities was held on 30 June 2017 in Tokyo District Court.

Prosecutors had twice decided against charges against any TEPCO executives but a citizen's panel ‒ which has the power to review judicial decisions ‒ overturned the decision and charges were laid early last year.

Prosecutors will argue that before the March 2011 Fukushima disaster, the executives had seen internal reports and simulations warning of the risk of a major earthquake in the region triggering a massive tsunami.

Kazuki Homori, lawyer for the Fukushima plaintiffs, said: "Through this trial, several of TEPCO's internal documents regarding tsunami countermeasures that had not been released before will be made public. It is amazing and disgraceful that while so much important evidence on TEPCO's tsunami countermeasures exists and moreover that they agreed to have it examined at a criminal trial, this evidence has thus far been hidden at all costs from civil trials."

He said the "future direction of this trial will be noteworthy if only as an important case regarding how the judiciary can fulfil its function of acting as a restraining influence on the national government's pro-nuclear policies."

Kazuki Homori, July/August 2017, 'First court day of TEPCO executives criminal trial', Nuke Info Tokyo No. 179, www.cnic.jp/english/?p=3907

Rachel Mealey, 30 June 2017, 'Former TEPCO bosses to face trial over deadly Fukushima nuclear disaster', www.abc.net.au/news/2017-06-30/former-executives-face-court-as-fukishima...

More Fukushima law suits

TEPCO said on 24 August 2017 that it has been sued by 157 individuals in a court in the US for US$5 billion in damages over the 2011 Fukushima nuclear disaster.1 The plaintiffs include crew members on board the USS Ronald Reagan during the 2011 disaster. The suit, filed on August 18 with the Southern District Court in California, was the second one lodged in the US following a similar suit filed in 2013 which currently has 239 registered plaintiffs.

As reported in Nuclear Monitor #840, a local court in central Japan ruled in March 2017 that the Japanese government and TEPCO were liable for negligence in the Fukushima disaster and shall pay a total of ¥38.6m (US$351,000) to 62 Fukushima evacuees.2 The court ruling sets an important precedent. It is the first of about 30 lawsuits to be brought by almost 12,000 Fukushima evacuees in 18 prefectures.

1. Xinhua, 24 Aug 2017, 'Japan's TEPCO sued by U.S. residents over Fukushima nuclear disaster', http://news.xinhuanet.com/english/2017-08/24/c_136552546.htm

2. Nuclear Monitor #840, 21 March 2017, 'One step forward, one step back for Fukushima evacuees', www.wiseinternational.org/nuclear-monitor/840/one-step-forward-one-step-...

Mental health afflictions for Fukushima first responders

Japan Times on 2 September 2017 published a detailed report on the mental health problems facing first responders to the March 2011 Fukushima disaster. A study of some 1,500 workers found that all had experienced a variety of stressors relating to their direct experiences of the disasters, losses of loved ones and the backlash from a disgruntled public, in particular from the 160,000 Fukushima evacuees (reflecting a tendency in Japan to associate both CEOs and their foot soldiers alike with the company they work for, making them collectively responsible).

According to the study's lead researcher Jun Shigemura, 29.5% of workers at the Fukushima plant subsequently displayed symptoms of high post-traumatic stress responses, including flashbacks and avoidance of reminders of the events they went through.

If the Chernobyl experience is repeated, mental health problems will afflict Fukushima first responders for decades to come. Studies have shown that mental health problems, including post-traumatic stress disorder, depression and suicide ideation, were still high and remained the most prevalent problem for the Chernobyl cleanup workers even 20 years after the disaster. "So I think we can say with some confidence that the Fukushima workers also carry a very high risk of developing long-term mental health issues," Shigemura said.

Fukushima plant worker stressors:

Work-related experience:

‒ Earthquakes and tsunami

‒ Plant explosions

‒ Radiation exposure

‒ Extreme overwork

‒ Worker shortage

Survivor experience:

‒ Mandatory evacuation

‒ Property loss

‒ Family dispersion

Grief — loss of:

‒ Colleagues

‒ Family members

‒ Friends

Social backlash:

‒ Public criticism

‒ Discrimination

‒ Harassment

‒ Guilt as "perpetrators" of a nuclear accident

Rob Gilhooly, 2 Sept 2017, 'Battling nuclear demons: Mental health issues haunt those who were the first line of defense after 3/11', www.japantimes.co.jp/news/2017/09/02/national/science-health/battling-nu...


 

Radioactive particles in northern Japan

The scientific journal Science of the Total Environment has published a peer-reviewed article entitled co-authored by Dr. Marco Kaltofen, Worcester Polytechnic Institute (WPI), and Arnie Gundersen, Fairewinds Energy Education. The article details the analysis of radioactively hot particles collected in Japan following the Fukushima Daiichi meltdowns. Based on 415 samples of radioactive dust from Japan, the US, and Canada, the study identified a statistically meaningful number of samples that were considerably more radioactive than current radiation models anticipated. If ingested, these more radioactive particles increase the risk of suffering future health problems.

Fairewinds, 27 July 2017, www.fairewinds.org/newsletter-archive//press-release-radioactively-hot-p...

Japan rates severity of Oarai nuclear exposure accident as INES Level 2

Japan's Nuclear Regulation Authority has provisionally assessed the severity of a 6 June 2017 accident as level 2 on the zero-to-seven International Nuclear Events Scale.1,2 The accident at the Japan Atomic Energy Agency's (JAEA) Oarai Research and Development Center in Ibaraki Prefecture left five workers internally exposed to radiation.

On June 6, a worker opened a container in a storage room at the facility and a plastic bag inside the container ruptured, releasing plutonium and uranium powder samples. Tests found small amounts of radioactive materials ‒ plutonium and americium ‒ in the urine of five workers, confirming they suffered internal radiation exposure. It was estimated that one of the workers will be internally exposed to a radiation dose of 100‒200 millisieverts over 50 years as a result of the accident1 ‒ but other reports suggest a far greater dose of 12,000 mSv over 50 years for the most heavily contaminated worker.3

JAEA said the release was of "Pu oxide, U oxide and others used in experiments, etc. for developing fast reactor nuclear fuel".4 Curiously, JAEA said it would "like to refrain from public disclosure" of other substances "from the viewpoint of nuclear non-proliferation."4

The ruptured container wasn't the only inappropriately stored material. According to information submitted to the Nuclear Regulation Authority by the JAEA Oarai Research and Development Center, nuclear materials cited as being inappropriately stored in cells and gloveboxes etc. comprised 2,207 samples ‒ some stored for several decades.4

The Citizens Nuclear Information Center said:4

"An important reason for the implementation of this task is found in the problems uncovered for the first time by a safety inspection last year. In the safety inspection carried out with respect to JAEA's Nuclear Science Research Institute (Tokai Village) in the third quarter of fiscal year 2016, it was discovered that, in violation of classifications provided in the safety regulations, nuclear fuel materials had been cited as being "in use" and stored in cells and gloveboxes for long periods of time.

"As a result, NRA instigated checks through safety inspections on the possibility that there might be similar violations at other nuclear-related facilities, including other JAEA facilities. According to NRA materials of February 2017, a total of ten facilities engaging in reprocessing, processing and use of nuclear fuels had been carrying out inappropriate long-term storage of nuclear fuel materials ..."

"This inappropriate long-term storage problem clearly shows, if one looks back at the historical series of organizations – the Nuclear Safety Commission, the Nuclear and Industrial Safety Agency and the NRA, that for 30 years or more none of these organizations made any public announcements on the issue, or knew what was happening and simply turned a blind eye. The regulatory organizations' neglect thus far and the defensive awareness that they do not want this to be aired in public has undoubtedly been one of the remote causes of the accident at Oarai."

Japan Times listed some other accidents:3

  • March 1997: Radioactive material leaked after a fire and explosion at the Ibaraki branch of now-defunct Power Reactor and Nuclear Fuel Development Corp., later absorbed by Japan Atomic Energy Agency. Thirty-seven employees were exposed.
  • September 1999: A self-sustaining chain reaction was triggered by the use of mixing buckets at uranium processing firm JCO Co. in the village of Tokai, Ibaraki Prefecture. The accident eventually killed two of three exposed employees, after tainting more than 600 residents.
  • June 2006: A suspected case of plutonium inhalation occurred at Japan Nuclear Fuel's reprocessing plant in the village of Rokkasho, Aomori Prefecture, but a check for internal exposure turns out negative.
  • July 2008: A worker at Global Nuclear Fuel Japan Co. was exposed to uranium in Yokosuka, Kanagawa Prefecture, followed by the exposure of four workers to a uranium-tainted liquid a month later.
  • March 2011: Three workers stepped into a puddle during the meltdown crisis at the Fukushima No. 1 power plant, exposing two to high radiation doses.
  • May 2013: Thirty-four researchers at JAEA's Japan Proton Accelerator Research Complex in Tokai were exposed to an exotic soup of isotopes during an experiment.

1. 2 Aug 2017, 'Japan rates severity of June nuclear exposure accident as level 2', https://mainichi.jp/english/articles/20170802/p2g/00m/0dm/059000c

2. Ed Lyman, 9 June 2017, 'Increase in Cancer Risk for Japanese Workers Accidentally Exposed to Plutonium', http://allthingsnuclear.org/elyman/cancer-risk-for-japanese-exposed-to-p...

3. 8 June 2017, 'Ibaraki plutonium exposures baffle Japanese nuclear experts', www.japantimes.co.jp/news/2017/06/08/national/ibaraki-plutonium-exposure...

4. CNIC, July/August 2017, 'Disturbing Plutonium Exposure Accident', Nuke Info Tokyo No. 179, www.cnic.jp/english/?p=3910

Update on the Toshiba / Westinghouse crisis

Nuclear Monitor Issue: 
#847
4662
21/07/2017
Jim Green ‒ Nuclear Monitor editor
Article

(Please subscribe to Nuclear Monitor at www.wiseinternational.org/nuclear-monitor/subscribe-nuclear-monitor)

The Toshiba / Westinghouse crisis continues to drag on without any clear resolution in sight. As things stand:

  • Toshiba will probably survive in a much-weakened form, assuming it can sell profitable assets to cover debts.
  • Profitable parts of Toshiba's US-based nuclear subsidiary Westinghouse will survive in one form or another after a restructuring plan has been developed and approved by the bankruptcy court. Westinghouse might survive in a weakened form or it might be carved up for sale and no longer be a recognizable entity.
  • Toshiba would like to sell its entire 90% stake in Westinghouse but that may not be possible.
  • Toshiba and Westinghouse will no longer take on reactor construction projects in their home countries or abroad.
  • Much of the discussion about the four partially-built AP1000 reactors in the US assumes that one way or another the reactors will be completed. The four reactors ‒ two in Georgia and two in South Carolina ‒ are largely responsible for the crisis facing Toshiba and Westinghouse due to cost overruns of around US$13 billion. But to push ahead would entail enormous risk and it would be no surprise if the owners of the nuclear plants decided to cancel one or both of the reactors at each plant.
  • Toshiba / Westinghouse and the NuGen consortium have yet to acknowledge that the plan for three AP1000 at Moorside in the UK is dead ... but it is dead.
  • The likelihood that the plan to build AP1000 reactors in India will proceed is vanishingly small.

Toshiba

Toshiba hopes to submit audited financial figures for the 2016/17 fiscal year, which ended 31 March 2017, by August 10.1 Toshiba and its auditor PwC Aarata are still working to reach agreement on the figures and to resolve their disagreement as to whether Toshiba should correct past financial reports.2

On June 23, Toshiba said it expects to report a negative net worth as of 31 March 2017 of ¥581.6 billion (US$5.18 billion), a 7.7% increase on earlier estimates.3 The company's estimated net loss for the 2016/17 fiscal year has also increased, to ¥995 billion (US$8.87 billion).3

Also on June 23, the Tokyo Stock Exchange (TSE) announced that from 1 August 2017, Toshiba shares will be demoted from the exchange's first section to its second tier.2,3 The TSE is also reviewing Toshiba's internal control systems to decide whether to remove the company from the exchange's designation as a "security on alert."2

Toshiba is trying to sell its prize asset, its memory chip business, to stave off bankruptcy and to avoid being delisted altogether from the TSE. But negotiations over the sale of the memory chip business have become complicated, as reported by Nikkei Asian Review:3

"Massive losses from its U.S. nuclear unit plunged the once-mighty Toshiba into negative net worth in fiscal 2016. The company is now desperately trying to raise enough funds to save itself from remaining in negative net worth for a second year ‒ a scenario that would see the company face delisting from the TSE. On Wednesday [June 21], it decided to prioritize negotiations with a Japanese government-led alliance for the sale of its flash memory unit.

"Any conclusion to the deal, however, faces obstacles. Bain Capital, the private equity firm in the alliance, is collaborating with South Korean chipmaker SK Hynix, making a protracted examination into antitrust matters a possibility.

"In addition, Toshiba chipmaking partner Western Digital has sought an injunction against the sale in a California court. With the U.S.-based company weary of the involvement of direct rival SK Hynix, the government-led alliance will have to negotiate with Western Digital, either by asking it to drop the case or trying to include it in the consortium.

"The formation of the alliance was mostly orchestrated by Japan's Ministry of Economy, Trade and Industry, which wants to keep Toshiba's sensitive chip technologies under domestic control."

Some bankers and potential investors are reportedly pressing the Toshiba board to consider alternatives to the sale of its memory chip business. But selling other assets is problematic as Toshiba has few of sufficient value, and a piecemeal sell-off could take too long.4 Toshiba will be automatically delisted from the TSE if it cannot drag itself out of its negative shareholder equity position by the end of the current fiscal year, ending 31 March 2018.5

In mid-June, Toshiba said it is being jointly sued by 70 shareholders, foreign institutional investors, and individuals seeking damages of ¥43.9 billion (US$391 million) related to a US$1.3 billion profit-padding scandal from 2008‒2014. Separately, Toshiba has been sued by 26 groups and individuals over the scandal with total damages of ¥108.4 billion (US$960 million) being sought.6

There was a moment's respite for Toshiba in early June when its share price rose, partly due to an agreement to cap Toshiba's liabilities for the AP1000 reactor project in Georgia at US$3.68 billion.7 But Toshiba lost all those gains and more and its stock price fell to half what it was before the problems with the US AP1000 projects came to light last December.8

Westinghouse

According to a July 3 Reuters report, citing industry and diplomatic sources, the US administration has said that Westinghouse will emerge from Chapter 11 bankruptcy and be sold to a US investor by the end of the year.9

But of course the government can't force investors to buy a bankrupt company. Toshiba has previously tried to sell Westinghouse, without success, and has openly flagged its ongoing desire to rid itself of Westinghouse. But the process is on hold until Westinghouse emerges from Chapter 11 bankruptcy proceedings with a court-approved restructuring plan.9

According to Reuters: "Some form of U.S. backing or involvement, industry experts say, could avoid a Chinese or Russian buyer unpalatable to Washington, which would prefer to keep Westinghouse's advanced nuclear technology out of the hands of its foreign rivals."9

In court records filed on June 5, the US Committee on Foreign Investments in the United States said that the sale of Westinghouse or its assets could be subject to the panel's review. Consisting of various cabinet members, the Committee is authorized to review transactions which could result in foreign persons or entities acquiring US businesses.10

In May, Westinghouse was in trouble with the US Nuclear Regulatory Commission (NRC) because of problems at its nuclear fuel plant in Columbia, South Carolina.11 After finding an accumulation of uranium in an air pollution control device last year, in May the NRC cited one additional violation related to the same piece of equipment. In June 2017, the NRC issued a notice of non-conformance to Westinghouse over lax quality assurance at its Mangiarotti subsidiary in Italy.12 The problem concerns incorrect use of material for AP1000 passive residual heat removal heat exchanger stiffener plates, identified in an earlier inspection. As with the problem at Columbia, Westinghouse has been slow to act. NRC inspections were carried out at Mangiarotti's plant in Italy in July 2016. Follow-up inspections were carried out at Westinghouse's plant in Rockville, Maryland in April 2017. The NRC concluded that Westinghouse "had not taken prompt corrective action or identified the cause of a significant condition adverse to quality", which involved the use of a different type of stainless steel in the manufacture of the component from that required.12

It has emerged that Toshiba didn't know that Westinghouse was preparing for a bankruptcy filing even after Westinghouse had hired lawyers for the task late last year, according to court records and Toshiba's official timeline. The Wall Street Journal commented: "If Toshiba's timeline is accurate, it suggests poor communication between parent and subsidiary contributed to letting the problems at Westinghouse get out of hand. Toshiba, one of Japan's biggest and oldest conglomerates, has said it has doubts whether it is a going concern because of its unit's bankruptcy. Conversely, if Toshiba did know about the unit's bankruptcy plans ahead of time but failed to disclose them promptly, it could worsen trust among investors at a time when stock-exchange officials in Tokyo are weighing whether to delist Toshiba shares."13

AP1000 reactors under construction in the US

Decisions about the fate of the partially-built AP1000 reactors in Georgia and South Carolina keep being deferred. Westinghouse is expected to break its contracts with the owners of the Vogtle (Georgia) and Summer (South Carolina) plants. Meanwhile the plant owners are weighing up their options regarding the future of the reactors, and paying for work to continue in the meantime. The owners of the South Carolina plant hope to make a decision on the fate of the two AP1000 reactors by August 10.14 And Southern Co. hopes to make a decision about the two reactors in Georgia "sometime in August" according to CEO Tom Fanning.15 But no previous deadlines have been met and the issue is likely to drag on for months.

Georgia Power and Westinghouse have finalized an agreement which allows for the transition of project management at the Vogtle plant from Westinghouse to Southern Nuclear and Georgia Power. Under the agreement, finalized on June 9, Toshiba will meet its contractual obligations by paying Southern Co. US$3.68 billion from October 2017 to January 2021 to help cover the costs of completing the two reactors, while Southern Co. agreed not to ask for more, even if the project continues to run over budget.16 The agreement has been approved by the US Department of Energy, which has a stake in the outcome of the negotiations because it approved a US$8.3 billion loan guarantee for the Vogtle project.

Toshiba may strike a similar agreement with SCANA and Santee Cooper in relation to the two AP1000 reactors under construction in South Carolina. SCANA and Santee Cooper would take responsibility for completing (or abandoning) the reactors, and Toshiba would make a payment to settle contractual obligations.17

On May 15, Toshiba said it had set aside ¥670 billion (US6.0 billion) to cover parent company guarantees for the Vogtle and Summer plants. Thus a payment of US2.3 billion for the South Carolina plant can be expected in addition to the US3.68 allocated for Georgia.

Another modest win for those hoping to complete the reactor projects in Georgia and South Carolina came on June 15 when the House of Representatives approved a bill on tax credits that could amount to around US$2 billion in subsidies for each of the nuclear plants ‒ Vogtle and Summer.18 However the future of the bill in the Senate is uncertain. The owners of the nuclear plants need the tax-credit subsidies locked in, and soon.

Despite the Toshiba agreement with the Vogtle owners, and the House of Representatives' vote on tax credits, the future of the Vogtle and Summer reactors is still very much in doubt.

Construction of the four reactors is less than half complete so there is ample scope for further delays and cost overruns. A report by consultants to the Georgia Public Service Commission found that attempts to improve efficiency have had little success: over the past year, four core activities at the Vogtle plant fell an average of 325 days further behind schedule.19

A recent document written by South Carolina state regulators states: "The projection of

time and costs is made more difficult given the incredible variances in time and costs

actually incurred in comparison to Westinghouse's previous quotes and projections of time

and costs."14

Owners of the nuclear plants are doing their best to estimate the likely costs to complete the four reactors ‒ but it is a guessing game. Analysts at Morgan Stanley say future costs could exceed current estimates by as much as US$8.5 billion, more than double what shareholders of the two companies are effectively pricing in.20

The Southern Alliance for Clean Energy (SACE) estimates that the total cost of the two reactors in Georgia could reach US$29 billion.19 SACE based its estimate on a June 2017 report by two utility consultants to the Georgia Public Service Commission. The consultants' report is based on a scenario in which the project comes online in 2022, and Westinghouse's bankruptcy adds further costs.19

A Morgan Stanley report in March 2017 said the final cost of the two Summer reactors could be as high as US$22.9 billion ‒ double the original estimate.18

Using the SACE figure for Georgia, and the Morgan Stanley figure for South Carolina, the total cost for the four reactors could be US$51.9 billion, more than double the original estimate of US$23.9 billion (US$14.1 billion for Vogtle and US$9.8 billion for Summer).

Nuclear corporations and lobby groups argue that completion of the Vogtle and Summer reactors is a "national security issue" and a "strategic national imperative". Typically, those meaningless assertions are backed up with the meaningless justification that the US will be "left behind" by other countries such as Russia and China if it exits the global nuclear industry. The Nuclear Energy Institute has gone one step further. The industry lobby group has been circulating a document in Washington arguing the case for tax credits to support nuclear power projects. The document states that if the Vogtle and Summer plants aren't completed, it would stunt development of the nation's nuclear weapons complex because the engineering expertise on the energy side helps the weapons side.21

A further complication for the owners of the South Carolina plant is that they learnt in June, much to their astonishment, that Westinghouse's detailed construction schedule for the two reactors is non-existent.18 "I'm just floored that they haven't been able to produce a schedule for their own project," said Tom Clements from Savannah River Site Watch. "That violates a basic tenet of sound construction management, and I think it reveals that there are more problems to be encountered if the project continues."18

Friends of the Earth and the Sierra Club filed a complaint with South Carolina state regulators on June 22, calling for a hearing on whether construction should be allowed to move forward at the Summer plant and whether the utilities should be forced to pay back money customers have already spent through higher rates to build the reactors.18 The South Carolina Public Service Commission approved the groups' request and a hearing is scheduled for August 14 in Columbia.18

The groups call on the Summer plant owners to "cease and desist from expending any further capital costs related to the Project" and referred to "unreasonable electric rates" ‒ in particular, nine electricity rate hikes since 2008 to help fund the Summer project.17

Dr Mark Cooper from the Institute for Energy and the Environment at Vermont Law School has written a detailed paper for Friends of the Earth and the Sierra Club in support of their complaint to the South Carolina Public Service Commission.22 Cooper argues:

"Management will waste more money going forward in a futile attempt to complete the project ... Future costs may be twice as much as the costs that have been sunk. This report outlines five steps that can be taken to soften the negative blow to both SCE&G ratepayers and the economy of South Carolina:

  • Stop wasting money by abandoning the project.
  • Claw back improperly expended sunk costs through reclamation under the bankruptcy laws and reparation for imprudent costs improperly incurred.
  • Return to traditional least-cost, used and useful principles for utility resource acquisition.
  • Rely on lower cost, cleaner resources, like efficiency, renewables and dynamic system management to meet any growth in demand or reduction in emission of pollutants.
  • Mitigate the bill impact by enhancing ratepayer ability to lower their electricity costs with on-bill financing of efficiency, reducing the profit paid on wasted capital expenses, and extending the period for cost recovery."

Cooper argues that "even under the unjustifiably optimistic projection of no future delays and cost overruns, ratepayers will be better off if the utility abandons the project, even if ratepayers are forced to bear the costs that have been sunk to date." In the best-case scenario, swift action by the Public Service Commission could save ratepayers as much as US$10 billion.

Planned AP1000 reactors in the UK

Numerous media reports over the past six weeks have flagged the possibility that South Korea's Kepco could buy into the NuGen consortium that planned to build three AP1000 reactors at Moorside in the UK. Toshiba would be more than happy to sell most or all of its stake in NuGen to Kepco ‒ or anyone else. But Kepco wants to build its own APR1400 reactors instead of Westinghouse AP1000s. That brings with it another set of problems ‒ financing, the anti-nuclear stance of recently-elected South Korean President Moon Jae-in, and the several years it would take for the APR1400 reactor design to go through a generic design assessment process in the UK. Suffice it here to note that previous plans to build AP1000 reactors at Moorside appear to be stone cold dead.

Planned AP1000 reactors in India

Indian Prime Minister Narendra Modi and US President Donald Trump issued a communique after their meeting in Washington in late June. The two leaders "looked forward to conclusion of contractual agreements between Westinghouse Electric Company and the Nuclear Power Corporation of India for six nuclear reactors in India and also related project financing," the communique said.23

However there is very little likelihood of contractual agreements, no clarity about financing, no obvious reason why India would pay for Westinghouse reactors when cheaper options are available to meet energy needs, no obvious reason why India would sign up for AP1000 reactors given the massive cost overruns in the US, and an unresolved disagreement about India's nuclear liability law.

Another obstacle is that Westinghouse ‒ assuming that Westinghouse even exists after the bankruptcy process ‒ is exiting the reactor construction business. The Hindu reported: "Westinghouse is working out a new model with its lenders under which they will design the reactor and provide consultations, but Indian companies would be entrusted with the actual construction of the plant. A process is underway to ascertain who will do what in the new business model and which Indian companies could be involved."24

References:

1. Reuters, 13 July 2017, 'Toshiba: Not true auditor told co it can't form opinion on annual report', www.reuters.com/article/us-toshiba-accounting-idUSKBN19Y03K?il=0

2. Nikkei Asian Review, 24 June 2017, 'Toshiba teeters on brink of delisting', http://asia.nikkei.com/Business/Companies/Toshiba-teeters-on-brink-of-de...

3. Shotaro Tani / Nikkei Asian Review, 23 June 2017, 'Toshiba's negative net worth widens to 5.2 billion dollars', http://asia.nikkei.com/Business/Companies/Toshiba-s-negative-net-worth-w...

4. 10 July 2017, 'Toshiba need alternative plan quick', www.simmtester.com/page/news/shownews.asp?num=19296

5. 23 June 2017, 'Toshiba asks regulators for extension on annual statement deadline to Aug. 10', www.japantimes.co.jp/news/2017/06/23/business/corporate-business/toshiba...

6. Kathleen Wirth, 13 June 2017, 'Toshiba Being Sued for $399 Million for Accounting Irregularities', http://wirthconsulting.org/2017/06/13/toshiba-being-sued-for-399-million...

7. Peter Wells, 12 June 2017, 'Toshiba jumps 8% after deal to cap US reactor liability', www.ft.com/content/889d3470-4a72-3039-9450-9602bd2faef1?mhq5j=e3
8. www.bloomberg.com/quote/6502:JP

9. Reuters, 3 July 2017, 'Indo-US nuclear deal: Westinghouse could be sold by Dec, ending bankruptcy, says report', http://indianexpress.com/article/business/companies/westinghouse-could-b...

10. Michael Smith, 7 June 2017, 'Washington weighs in on Westinghouse bankruptcy', www.northaugustastar.com/news/washington-weighs-in-on-westinghouse-bankr... of Form

11. Sammy Fretwell, 8 May 2017, 'Nuclear-safety concerns linger at Westinghouse plant', www.thestate.com/news/local/article149368179.html

12. World Nuclear News, 21 June 2017, 'Westinghouse subsidiary receives notice of non-conformance', www.world-nuclear-news.org/RS-Westinghouse-subsidiary-receives-notice-of...

13. Kosaku Narioka, 8 June 2017, 'Toshiba Unaware Its Nuclear Unit Was Preparing for Bankruptcy, Timeline Shows', Wall Street Journal, www.advfn.com/news_Units-Woes-Stun-Toshiba-Toshiba-Missed-Unit-Woes_7496...

14. www.regulatorystaff.sc.gov/Documents/7-12-17%20Nuclear%20Construction%20...

15. Nikkei Asian Review, 13 July 2017, 'US utility to decide fate of Westinghouse reactors in August', http://asia.nikkei.com/Business/Companies/US-utility-to-decide-fate-of-W...

16. World Nuclear News, 12 June 2017, 'Vogtle agreement caps Toshiba obligation', www.world-nuclear-news.org/C-Vogtle-agreement-caps-Toshiba-obligation-12...

17. Michael Smith, 23 June 2017, 'Toshiba seeks SCANA, Santee Cooper takeover of V.C. Summer', www.aikenstandard.com/news/toshiba-seeks-scana-santee-cooper-takeover-of...

18. David Wren, 24 June 2017, 'Missing documentation throws Santee Cooper, SCE&G nuclear project timeline, costs in doubt', www.postandcourier.com/news/missing-documentation-throws-santee-cooper-s...

19. Tom Hals, 15 June 2017, 'Group says Georgia nuclear plant costs rise to $29 billion', www.reuters.com/article/us-toshiba-accounting-westinghouse-bankr-idUSKBN...

20. Lauren Silva Laughlin, 28 March 2017, 'Nuclear waste', www.breakingviews.com/considered-view/utilities-to-pay-price-of-westingh...

21. Amy Harder, 16 June 2017, 'Nuclear scramble on tax credits', www.axios.com/nuclear-scramble-on-tax-credits-2442400126.html

22. Mark Cooper, July 2017, 'The Failure of the Nuclear Gamble in South Carolina', www.cleanenergy.org/wp-content/uploads/MarkCooper_VCSummerReport_Final_J...

23. Reuters, 3 July 2017, 'Indo-US nuclear deal: Westinghouse could be sold by Dec, ending bankruptcy, says report', http://indianexpress.com/article/business/companies/westinghouse-could-b...

24. Vikas Dhoot, 28 June 2017, 'Westinghouse's $20 billion nuclear deal needs a reboot', www.thehindu.com/business/Economy/westinghouses-20-billion-nuclear-deal-...

Toshiba and Westinghouse fight for survival

Nuclear Monitor Issue: 
#849
4673
25/08/2017
Jim Green ‒ Nuclear Monitor editor
Article

(Please subscribe to Nuclear Monitor at www.wiseinternational.org/nuclear-monitor/subscribe-nuclear-monitor)

On August 10, Toshiba reported its financial figures for the 2016 fiscal year (ending 31 March 2017) after repeated delays and a protracted dispute with its auditor. Toshiba reported a net loss of ¥‎965.7 billion (US$8.83bn; €7.51bn)1 ‒ more than double the loss of the previous year, and the largest-ever annual loss for a Japanese manufacturer.2

Toshiba said its net worth is negative ¥552.9 billion ($5.07bn; €4.29bn)2 and notes (as it did in April) that there is "substantial doubt about the Company's ability to continue as a going concern".1

Toshiba's losses on its nuclear businesses amounted to over US$11 billion (€9.65bn) in the 2016 fiscal year. The company's financial report states: "Toshiba Group recorded a net loss attributable to shareholders of the Company of 965.7 billion yen (US$8622.0 million), due to the loss of 1,242.8 billion yen (US$11,096.3 million) generated in Westinghouse, its U.S. subsidiaries and affiliates, and Toshiba Nuclear Energy Holdings (UK) Limited, a holding company for Westinghouse Group operating companies outside the U.S."1

Toshiba noted that its subsidiary Westinghouse Electric Company, Westinghouse's US subsidiaries, and Toshiba Nuclear Energy Holdings (UK) Limited, had all filed for Chapter 11 bankruptcy protection under the US Bankruptcy Code on March 29. Those filings "deconsolidated Westinghouse from Toshiba", Toshiba said.1

Toshiba has agreed to meet parent-company contractual agreements with US utilities by paying US$3.68 billion to the owners of the Vogtle AP1000 project in Georgia, and US$2.17 billion to the owners of the VC Summer AP1000 project in South Carolina, in the coming years.1 Thus Toshiba ‒ assuming the company still exists ‒ will be free from the mess of the AP1000 projects in the US when its makes its final payment in September 2022.

And Toshiba hopes to rid itself of Westinghouse altogether: "As part of the Company's plan to offset the negative impact of the ongoing situation, the Company has been reviewing a restructuring plan of Westinghouse Group including deconsolidation by a potential sale of a majority stake in order to eliminate risk in the overseas nuclear power business."1

Auditor dispute

Toshiba had to repeatedly delay releasing its financial figures because of a protracted dispute with its auditor, PricewaterhouseCoopers (PWC) Aarata. The auditor issued an "opinion with qualifications" regarding Toshiba's annual earnings report on August 10, along with an "adverse opinion" on Toshiba's internal controls.2,3 PWC Aarata also said there is an "unfixed significant misstatement" and that Toshiba's figures "are not based on generally accepted corporate accounting levels".2

PWC Aarata believes Toshiba "should have booked a respectable degree or all" of the massive losses stemming from its US-based subsidiary Westinghouse ‒ lead contractor for the VC Summer and Vogtle AP1000 projects ‒ in fiscal 2015 instead of the following year.2 Toshiba claims it wasn't aware of the massive cost overruns with the US AP1000 projects but PWC Aarata evidently believes otherwise.4

If Toshiba followed its auditor's advice, it would have recorded negative net worth for two consecutive years, which would normally trigger a delisting from the Tokyo Stock Exchange.5 That, in turn, would take Toshiba one step closer to bankruptcy ‒ hence the company's reluctance to accept the auditor's advice.

Stock exchange listing

As things stand, Toshiba has avoided a stock exchange delisting – but on August 1 it was demoted to the second tier of the exchange, and will no longer feature in the Nikkei 225 index of Japan's top public companies.6

Toshiba is still under pressure. Japan Times noted that "there are still two scenarios under which it could be delisted from the Tokyo Stock Exchange: by failing to eliminate its negative net worth and failing to show improvement in its internal management controls. TSE rules stipulate that firms must be delisted if they conclude two consecutive business years in a negative net worth. Because Toshiba ended 2016 with a negative net worth, it was demoted last Tuesday to the TSE's second section."7

Financial Times journalist Peter Wells wrote on August 10:8

"The immediate threat to Toshiba may have receded after its auditor signed off its annual results but the broader dangers that still threaten the company's future have not disappeared. Toshiba remains, say people close to the conglomerate, "absolutely devoted" to remaining listed on the Tokyo Stock Exchange.

"But the decision by PwC Aarata, Toshiba's auditor, to add a so-called adverse opinion of the company's internal controls could still bring about its delisting. "I don't see how the TSE can look at the wording of that criticism and decide that Toshiba did have adequate control of its systems at the end of March 2017," says Travis Lundy, an analyst at Smartkarma. The wording, he suggests, lowers the likelihood of Toshiba remaining listed. "I don't see anything that suggests this was a problem in the past, but that it has now been fixed."

"Toshiba's biggest challenge has certainly not gone away. It is still scrambling to fill a $5bn hole in its shareholder equity, punched by a $6.3bn writedown on its US nuclear business, the Westinghouse subsidiary that filed for Chapter 11 bankruptcy protection this year. Japanese companies that report two consecutive years of negative shareholder equity face delisting from the TSE, although the exchange operator is able to exercise some discretion.

"Successfully closing the $18bn sale of its memory chip business by the end of its financial year in March 2018 remains Toshiba's best shot at reversing the shareholder equity deficit and avoiding a forced delisting. But the sale process continues to face numerous obstacles, and bankers, lawyers and other executives involved with the sale have repeatedly described "chaos" in the process. ... Owing to the time any sale agreement would take to pass regulators ‒ as well as the need to smooth out a complicated legal spat with joint venture partner Western Digital ‒ Toshiba has in effect until the end of August to conclude a sale, say bankers and lawyers involved in the talks."

"Even if Toshiba can get the chip unit sale back on track in a timely fashion, the risk of delisting may not subside quickly. Since its [profit padding] accounting scandal in 2015, Toshiba has been under scrutiny from the TSE, and in September last year submitted a report on its internal management controls to the bourse operator. But that was knocked back by the exchange three months later. In March, Toshiba resubmitted the report ‒ its second and final chance to impress the TSE that its controls were up to scratch. Should the TSE at some point decide that Toshiba's internal controls are passable, then it would have to justify how it arrived at a different conclusion from the independent auditor. Such a discrepancy could send investors at home and abroad the wrong signal at a time when Japan is keen to show it is trying to improve corporate governance standards."

Bankruptcy

The small risk of Toshiba going bankrupt will loom much larger if the sale of the memory chip business falls through. There is also a possibility that Toshiba will voluntarily file for bankruptcy protection, much as Westinghouse has done in the US. The Wall Street Journal reported on July 27:9

"A number of creditors and others involved in Toshiba Corp.'s restructuring are pushing for a Toshiba bankruptcy filing as the best path to rebirth after its effort to raise money through a chip-unit sale stalled. People involved in talks over Toshiba's workout, including business partners, lawyers and people with ties to the company's main bankers, said bankruptcy is worth serious study. Some of them said it is the best available option and that they are advocating it in discussions with Toshiba or creditors. They said a bankruptcy filing by Toshiba, the core of an industrial conglomerate, could free it of burdens that include lingering liabilities from the March bankruptcy of its Westinghouse Electric Co. nuclear unit in the U.S."

"Toshiba's chief executive, Satoshi Tsunakawa, said at a recent news conference that seeking debt relief through the courts isn't an option. A Toshiba spokesman reiterated this week that the company has "no specific plan" to seek bankruptcy protection.

"A person familiar with deliberations at one of Toshiba's main lenders compared the conglomerate to a hole that might have treasure at the bottom but also lurking snakes. Bankruptcy, this person said, could kill any snakes and let the lenders access the treasure. ...

"One person directly involved in a portion of the Toshiba recovery plan said "everyone thinks" bankruptcy has to be looked at ‒ but it is difficult to say so publicly."

Westinghouse

On July 31, SCE&G and Santee Cooper announced their decision to abandon the two partially-built AP1000 reactors at the VC Summer plant in South Carolina. Westinghouse wasn't forewarned even though it was formally the lead contractor on the project (though less directly involved since its March 29 bankruptcy filing). Westinghouse has been working on restructuring plans which assumed that the company would play a minor but profitable role in the completion of the VC Summer project ‒ those plans must now be reworked.

In a court filing on July 26, Westinghouse asked a New York bankruptcy judge to allow the company an extra three months to file a restructuring plan.10 Westinghouse said it needs more time given the complicated nature of the business ‒ the company has thousands of vendors, around 37,000 creditors and "five different business lines that serve more than half of the nuclear power plants in the world".10 Bankrupt companies have a 120-day exclusivity period to come up with a reorganization plan, the Pittsburgh Post-Gazette reported, and another 60 days to try to gain approval of it without worrying about creditors or others introducing competing plans.10 Westinghouse is seeking to extend both deadlines until December 6 and February 4, 2018, respectively.

On July 31, Westinghouse said it has submitted a five-year business forecast to its bankruptcy lenders which includes savings of US$205 million over that period and plans to cut 7% of its 14,000-strong global workforce.11,12

In early August, Westinghouse laid off 870 employees who were working on or supporting the VC Summer project.13 That prompted a lawsuit alleging that Westinghouse violated labor laws by laying off hundreds of workers without proper notice. Seeking class-action status, Andrew Fleetwood, a field engineering manager at VC Summer, is suing Westinghouse for violating the Worker Adjustment and Retraining Notification Act, which requires employers to provide at least 60 days of advance notice before a plant shutdown or a mass layoff.13 Westinghouse said it provided as much notice as practicable and that the employees will be permanently laid off on August 31 if no other assignment is identified for them.

On August 7, Westinghouse asked the bankruptcy court to allow it to break thousands of contracts associated with the VC Summer project ‒ contracts cover everything from engineering services and security protection to scaffolding and urine testing.14 These contractors will join the long list of unsecured creditors in Westinghouse's bankruptcy. The company has accumulated debts of around US$9.8 billion.15

Santee Cooper said in late July that it will continue to pursue Westinghouse's assets in bankruptcy court to obtain further payment on top of its share (US$976 million) of the parent-company contractual settlement of US$2.17 billion agreed to by Westinghouse's parent company Toshiba for the VC Summer project.16 Santee Cooper will "continue to pursue Westinghouse ... revenues and assets through bankruptcy court and other legal channels" to further offset its losses, according to chief executive Lonnie Carter.17

On June 27, the Delaware Supreme Court ruled against Westinghouse, and in favor of Chicago Bridge & Iron Co, in a US$2 billion dispute over cost overruns with the four AP1000 reactors under construction in Georgia and South Carolina.18,19

References:

1. Toshiba Corporation, 10 Aug 2017, 'Toshiba Announces Consolidated Results for Fiscal Year 2016, to March 31, 2017', www.toshiba.co.jp/about/ir/en/finance/er/er2016/q4/ter2016q4e.pdf

2. Kyodo, 10 Aug 2017, 'Toshiba submits delayed financial report, avoids immediate delisting', https://english.kyodonews.net/news/2017/08/ba1c8caa4acd-toshiba-submits-...

3. Reuters, 10 Aug 2017, 'Toshiba's auditor gives 'adverse opinion' on governance: filing', www.reuters.com/article/us-toshiba-accounting-governance-idUSKBN1AQ0CN

4. Nikkei Asian Review, 11 Aug 2017, 'Battle between auditors drove Toshiba's earnings delay'', https://asia.nikkei.com/Japan-Update/Battle-between-auditors-drove-Toshi...

5. Reuters, 10 Aug 2017, 'Toshiba wins auditor sign-off, likely avoiding delisting for now', www.reuters.com/article/us-charter-commns-m-a-altice-idUSKBN1AP1QN

6. 2 Aug 2017, 'Cumbria nuclear backer Toshiba sees stock exchange demotion', www.in-cumbria.com/Cumbria-nuclear-backer-Toshiba-sees-stock-exchange-de...

7. Kazuaki Nagata, 10 Aug 2017, 'Toshiba ducks delisting by submitting long overdue financial report', www.japantimes.co.jp/news/2017/08/10/business/corporate-business/toshiba...

8. Peter Wells, 10 Aug 2017, 'Cloud hangs over Toshiba even after auditor sign-off', www.ft.com/content/d6ac9154-7dc1-11e7-9108-edda0bcbc928
9. Kosaku Narioka, Takashi Mochizuki and Peter Landers, 27 July 2017, 'Toshiba Bankruptcy Filing Pushed by Some Involved in Workout', www.wsj.com/articles/toshiba-bankruptcy-filing-pushed-by-some-involved-i...

10. Anya Litvak / Pittsburgh Post-Gazette, 27 July 2017, 'Westinghouse needs more time in crafting bankruptcy plan', http://powersource.post-gazette.com/powersource/companies/2017/07/26/Bri...

11. Anya Litvak / Pittsburgh Post-Gazette, 16 Aug 2017, 'Westinghouse cuts office space in North Hills', http://powersource.post-gazette.com/powersource/companies/2017/08/16/Wes...

12. World Nuclear News, 1 Aug 2017, 'US nuclear construction project to be abandoned', www.world-nuclear-news.org/NN-US-nuclear-construction-project-to-be-aban...

13. Anya Litvak / Pittsburgh Post-Gazette, 11 Aug 2017, 'Westinghouse furloughed 870 employees in fallout from the cancelled South Carolina nuclear project', http://powersource.post-gazette.com/powersource/companies/2017/08/11/Wes...

14. Anya Litvak / Pittsburgh Post-Gazette, 9 Aug 2017, 'Westinghouse: Project canceled 'without warning'', http://powersource.post-gazette.com/powersource/companies/2017/08/09/Sou...

15. Nathan Bomey / USA Today, 30 March 2017, 'Georgia nuclear plant in jeopardy after Westinghouse plunges into bankruptcy', www.11alive.com/money/georgia-nuclear-plant-in-jeorpardy-after-westingho...

16. Steven Mufson, 31 July 2017, 'S.C. utilities halt work on new nuclear reactors, dimming the prospects for a nuclear energy revival', www.washingtonpost.com/business/economy/sc-utilities-halt-work-on-new-nu...

17. Andrew Ward, 1 Aug 2017, 'Westinghouse nuclear project halted in South Carolina', www.ft.com/content/aaaeda90-761d-11e7-a3e8-60495fe6ca71

18. Reuters, 29 June 2017, 'US court rules for Chicago Bridge in Westinghouse dispute', http://asia.nikkei.com/Spotlight/Toshiba-in-Turmoil/US-court-rules-for-C...

19. Anya Litvak / Pittsburgh Post-Gazette, 27 June 2017, 'Court rules against Westinghouse in nuclear acquisition deal', http://powersource.post-gazette.com/powersource/companies/2017/06/27/wes...

Fukushima Fallout: Updates from Japan

Nuclear Monitor Issue: 
#845
4652
08/06/2017
Article

The latest issue of Nuke Info Tokyo, the bimonthly English-language newsletter produced by Japan's Citizens' Nuclear Information Centre (CNIC), has been published. It's well worth subscribing to the newsletter and it's free ‒ email cnic@nifty.com. Some of the content from the latest newsletter is summarized here.

Federation for Nuclear-Free Renewable Energy Launched

"Genpatsu Zero – Shizen Enerugi Suishin Renmei" (translated as "Federation to Promote Nuclear-Free Renewable Energy") was established on April 14, with a press conference held in Tokyo. Tsuyoshi Yoshiwara, who has served as advisor to the board of the Johnan Shinkin Bank and has appealed for the elimination of nuclear energy from a managerial standpoint, was appointed as president. Hiroyuki Kawai, who represents "Datsu Genpatsu Bengodan Zenkoku Renrakkai" (the Nationwide Liaison Association of Nuclear-Free Defense Lawyers), was appointed managing director. Two former prime ministers ‒ Junichiro Koizumi and Morihiro Hosokawa ‒ are listed as advisers.

Reactor restarts

Kansai Electric Power Co.'s (KEPCO's) Takahama Unit 4 reactor (PWR, 870 MW) was restarted on May 17, and Takahama Unit 3 (also PWR, 870 MW) was restarted in early June. Together with Kyushu Electric Power Co.'s Sendai Units 1 and 2 (both PWR, 890 MW) and Shikoku Electric Power Co.'s Ikata Unit 3 (PWR, 890 MW), which have previously resumed operation, this will make five nuclear reactors that have been restarted in Japan. All of them are pressurized water reactors (PWR). Not one boiling water reactor (BWR) has yet been restarted.

CNIC statements on compensation for Fukushima victims and Takahama reactor restarts

CNIC recently released two statements on court cases related to nuclear issues, which have been translated into English so that international readers can read about these important court rulings as well as get an update on what is happening on the legal scene in Japan.

In May 2016, Nuke Info Tokyo #172 published an article on court cases associated with nuclear facilities in Japan after the Otsu District Court in Shiga Prefecture, western Japan, issued a provisional injunction ordering Kansai Electric Power Company (KEPCO) to shut down Takahama Units 3 and 4. Unfortunately this court order was overturned by the Osaka High Court, the subject of one of the CNIC statements. Although the higher court in Osaka overturned the lower court's injunction on Takahama, the fact that this NPP was unable to operate over the past year is significant, both in terms of reducing the risk of an accident during this time and in disrupting the finances and planning of KEPCO.

The other CNIC statement applauds the Maebashi District Court for its ruling which makes clear that the government of Japan and TEPCO may be liable for the Fukushima Daiichi accident. It is hoped that the Maebashi District Court's judgment will not be overturned even though TEPCO and the government have lodged an appeal.

The two statements are posted at: www.cnic.jp/english/?p=3851

India-Japan Nuclear Cooperation Agreement approval bill passes the Lower House of the Diet

The India-Japan Nuclear Cooperation Agreement, which was signed with great fanfare when Indian PM Narendra Modi was visiting Japan in November 2016, has since been working through the Japanese ratification process. It was presented to the Lower House of the Diet on April 14 and was then referred to the Lower House Committee on Foreign Affairs for deliberation.

After two hours of deliberations on April 28, when Committee members questioned three witnesses, and then another full day of questioning, the Minister of Foreign Affairs and related bureaucrats on May 10, the Committee approved the Agreement in the vote on May 12. Many serious questions were raised by both the independent witnesses and opposition lawmakers, such as whether provisions in the Agreement would adequately prevent India, a country possessing nuclear weapons, from using Japanese technology for military purposes; if India conducted another nuclear test, would Japan even be able to end the Agreement? And even if they could, what could be done about reactors that had already been sold to India? There were no clear answers from the Minister down and it seemed that they were hardly serious about debating this vitally important issue, knowing that they had the numbers to push it through.

After clearing the Committee in this way, the bill was sent back to the Lower House where Shinji Oguma, an MP from Fukushima, led the opposition against it. Once again, however, because of the ruling coalition's overwhelming majority, the serious problems with the Agreement, which were again emphasized by Oguma and others, were ignored and the bill passed. The battleground shifted to the Upper House, which approved the Agreement on June 7.

Evacuation orders lifted for Iitate, Kawamata, Namie, Tomioka

The Japanese government has lifted evacuation orders for zones it had designated as "areas to which evacuation orders are ready to be lifted" and "areas in which residents are not permitted to live" as a result of the Fukushima Daiichi nuclear accident. The orders were lifted in Iitate, Namie and the Yamakiya district of Kawamata on March 31 and in Tomioka on April 1. Evacuation orders for "areas where it is expected that residents will face difficulties in returning for a long time" (or, more briefly, "difficult-to-return zones") remain in place.

The evacuation orders originally affected a total of 12 municipalities, but had been lifted for six of those as of last year. The latest rescission of orders has brought the ratio of refugees allowed to return to their homes to about 70%, with the area still under evacuation orders reduced to about 30% of its original size. TEPCO intends to cut off compensation to these refugees, with a target date of March 2018, roughly a year after the evacuation orders were lifted. Additionally, the provision of free housing to "voluntary evacuees," who evacuated from areas not under evacuation orders, was discontinued at the end of March 2017.

The number of people forced to abandon their homes due to the Fukushima nuclear accident reached a peak of 164,865 people in May 2012, when they had no choice but to evacuate. Now, even six years later, 79,446 evacuees (as of February 2017) continue to lead difficult lives as refugees.

In the six municipalities for which the evacuation orders were lifted last year, the repatriation of residents has not proceeded well. Repatriation ratios compared to the pre-disaster population have been about 50 to 60% for Hirono and Tamura, about 20% for Kawauchi, and not even 10% for Naraha, Katsurao and the Odaka district of Minamisoma, where radiation doses were high.

The number of evacuees affected by the current lifting of evacuation orders for the four municipalities is 32,169. The ratio of positive responses to a residents' opinion survey conducted by the Reconstruction Agency from last year to this year saying they would like to be repatriated was rather low, with about 30 to 40% for Iitate and Kawamata, and less than 20% for Namie and Tomioka. During the long course of their evacuation, spanning six years, many of the residents had already built foundations for their lives in the places to which they had evacuated.

In a Cabinet Decision on December 20, 2016, the Japanese government adopted a "Policy for Accelerating Fukushima's Reconstruction." This policy promotes the preparation of "reconstruction bases" in parts of the "difficult-to-return zones" and the use of government funds for decontamination toward a target of lifting the evacuation orders for these areas in five years and urging repatriation. "Difficult-to-return zones" span the seven municipalities of Futaba, Okuma, Tomioka, Namie, Iitate, Katsurao and Minamisoma. By area, they account for 62% of Okuma and 96% of Futaba. The affected population numbers about 24,000 people.

The government's repatriation policy, however, is resulting in bankruptcies. Rather than repatriation, they should be promoting a "policy of evacuation" in consideration of current conditions. Policies should be immediately implemented to provide economic, social and health support to the evacuees, enabling them to live healthy, civilized lives, regardless of whether they choose to repatriate or continue their evacuation.

Citizens' Nuclear Information Centre, May/June 2017, Nuke Info Tokyo No. 178, www.cnic.jp/english/?p=3868

Update on the Toshiba / Westinghouse crisis

Nuclear Monitor Issue: 
#843
4642
10/05/2017
Jim Green ‒ Nuclear Monitor editor
Article

As discussed in Nuclear Monitor #841, Japanese conglomerate Toshiba said on April 11 that there is "substantial doubt about the Company's ability to continue as a going concern". Toshiba's US nuclear subsidiary Westinghouse filed for bankruptcy protection on March 29.

The companies are in crisis because of extraordinary cost overruns building four AP1000 reactors in the US ‒ two each in Georgia and South Carolina. Estimating the scale of the cost overruns is difficult because there is still much work to be done to complete the reactors. A reasonable estimate is that if the reactors are completed, the combined overruns will amount to about US$13 billion.1,2 Estimates compiled by Reuters put the cost overruns ‒ again assuming that the reactors are completed ‒ at US$3.9‒6.7 billion for the reactors in Georgia and US$11.9 for the reactors in South Carolina, a combined total of US$15.8‒18.6 billion.3

Toshiba wants to sell Westinghouse but can't find a buyer, although profitable parts of Westinghouse's operations might be sold off after a company restructure. Toshiba is also restructuring and selling some of its own businesses to avoid bankruptcy. Toshiba said on April 24 that it will establish its four in-house companies as wholly-owned subsidiaries.4 As of October 1, it will split off its Energy Systems & Solutions Company, and the Nuclear Energy Systems & Solutions Division, and transfer them to a newly established company. The other three companies to be established as independent business entities are Infrastructure System & Solutions Company, Storage & Electronic Devices Solutions Company, and Industrial ICT Solutions Company.

The Financial Times reported: "Toshiba is not expected to seek to sell the subsidiaries because the group last month identified that much of the activities done in these four areas as essential to its turnround strategy. But the shake-up will leave the 144-year-old conglomerate, once a proud pillar of the Japanese industrial establishment, as a mere shadow of its former self. Toshiba is planning to sell its Nand memory chip business, the group's flagship technology asset, as well as offload much or all of Westinghouse. The Nand business could raise more than $20bn for the group ‒ and therefore help repair its balance sheet."5

Toshiba's stand-off with its auditor

On April 11, Toshiba's auditor PricewaterhouseCoopers Aarata refused to sign off on Toshiba's financial report ‒ Toshiba reported a net loss of ¥647.8 billion (US$5.7bn) for the Oct. to Dec. 2016 quarter. The main sticking point has been Toshiba's accounting in relation to the AP1000 reactors in the US.

Over the past month, Toshiba has been looking for a new auditor.6 The other three of the Big Four accounting firms are probably non-starters. Deloitte Touche Tohmatsu and KPMG Azsa have past business ties to Toshiba. So does Ernst & Young ShinNihon, Toshiba's previous auditor. Ernst & Young ShinNihon incurred a fine and reputational damage for failing to detect Toshiba's billion-dollar profit-padding scam from 2008‒2014.6

Toshiba is seeking a second-tier accounting firm to sign off on its accounts but the Financial Times reported that only a few such firms have the expertise and the number of auditors needed to handle a group as large as Toshiba.6

Any auditing firm that certifies Toshiba's accounts does so at the risk of damaging its own reputation.

Sacking PricewaterhouseCoopers is not a simple option for Toshiba ‒ it would require shareholder approval.7 Sacking the auditor could unsettle the Stock Exchange, Reuters reported, but Toshiba "is out of attractive options."8

Toshiba has said it will release its figures for the March 2016 to March 2017 fiscal year by mid-May, but that could be extended to June 30. The company says it expects to report a net loss of just over ¥1 trillion (US$8.9bn) for the fiscal year, well over double the estimate of ¥390 billion provided in February.9

Stock exchange listing / delisting

Toshiba faces being delisted from the Tokyo Stock Exchange, an outcome that will be all the more likely if it releases unaudited figures for the 2016‒17 fiscal year (as it did for the Oct. to Dec. 2016 quarter). Delisting would create a new set of problems that would make it all the more difficult for the company to survive ‒ big investors would likely sell their stock, financing costs would increase, more lawsuits from shareholders would be expected, the share price would take another hit (it has fallen by 50% over the past six months) and, as Reuters reported, shareholders would be left with "near-worthless paper".8 Last but not least, the complete collapse of Toshiba would loom as a real possibility.

The Reuters report continued: "There are three hurdles. First, a Tokyo Stock Exchange review has to conclude managers have fixed long-running shortcomings in internal controls. Second, the company must claw its way out of negative equity by March – hence the 2 trillion yen-plus ($18 billion) sale of its memory-chip business. And third, it must file full-year results promptly: ideally by May 15, late June at the very latest."8

A zombie company?

Creditors and investors are nervous. In mid-April, Toshiba lost access to one of its subsidiary's funds after hedge fund Oasis Management went to court to get the subsidiary to take back its cash ‒ ¥87.8 billion (US$771m) ‒ from the parent company.10 If that trickle becomes a flood ‒ and in particular if the banks call in their loans ‒ Toshiba will be doomed.

The BBC outlined three possible outcomes for Toshiba.11 Firstly, it might become a zombie company like Sharp, TEPCO and many others: loss-making or insolvent companies that should be allowed to fail, but continue to operate because of lenient creditors. The second ‒ and most likely ‒ option is a break-up of the company (the strategy that is already playing out with Toshiba's plan to sell its memory chip business). The third possibility is a complete collapse of Toshiba. "If the chip sale falls through, more accounting irregularities emerge or the banks decide to call in their loans, then all bets are off," BBC business reported Leisha Chi said in an April 16 article.11

Might Toshiba file for bankruptcy protection?

Southern Company, which hired Toshiba subsidiary Westinghouse to build two nuclear reactors in Georgia, is concerned that Toshiba will apply for protection from creditors and relieve itself of the guarantees made on Westinghouse's behalf, sources have told the Wall Street Journal.12 A Toshiba official reportedly said the best way to save the company could be a filing under Japan's corporate reorganization law, which is similar to US Chapter 11 bankruptcy protection legislation in that it seeks to allow a company to stay in business by relieving it of some obligations. The Toshiba official said the move could free Toshiba of its obligations to Westinghouse and its customers, including its obligations to provide funding to complete AP1000 reactors under construction in the US.

However a Toshiba spokesperson said: "At this moment, we do not have any thought or intention of seeking protection under corporate-reorganization proceedings."12

The Wall Street Journal reported:12

"A Japanese chapter 11-style filing is only one of several scenarios Toshiba could choose. It presents several downsides: Suppliers could take a hit, hurting the broader economy, and shareholders could be wiped out ‒ though Toshiba's shares are already in danger of being delisted in Tokyo because of accounting problems that emerged in 2015. But the filing would strengthen Toshiba's balance sheet and could allow it to keep its profitable memory-chip business, the Toshiba official said ‒ relieving Japanese government concerns about technology leaks to Chinese or other competitors. A person familiar with Southern's thinking said Japanese creditor banks have significant leverage in deciding what to do with Toshiba, and that their loans would come ahead of other obligations. "We are not first in line," this person said."

Westinghouse and the AP1000 reactors in the US

Westinghouse filed for Chapter 11 bankruptcy protection on March 29, listing assets of US$4.3 billion and liabilities of US$9.4 billion among about 35,000 creditors.13

Westinghouse said on March 29 it would no longer spend money on the Vogtle (Georgia) and Summer (South Carolina) AP1000 projects, but reached an agreement with the utilities involved to allow them to pay costs to continue the projects during a 30-day interim period while decisions on the future of the projects are made. That 30-day period was later extended until May 12 for the Georgia project and June 26 for South Carolina.14

Between April 7 and April 20, about 30 vendors asked Westinghouse to return US$35 million in materials and products ordered for the four reactors in Georgia and South Carolina before the company filed for bankruptcy protection.15 No doubt other vendors have done likewise since April 20. Many Westinghouse suppliers received letters saying that their invoices for work performed or products supplied before the bankruptcy protection filing could not be paid at this time.16

Westinghouse plans to complete a restructuring plan by the end of June 2017 and a new business plan by the end of July 2017. The aim is to ring-fence the four AP1000 reactors. Gavin Liu, Westinghouse's president for Asia, said the "rest of the Westinghouse business, the healthy part, which is new plant construction, fuel, service, decommissioning ‒ we anticipate an ownership change."17 Liu noted that there has been "high interest from the financial community" in the profitable parts of the company's operations.17

Toshiba would like to sell Westinghouse and keep its profitable businesses ‒ but must instead sell profitable businesses to cover the debts from Westinghouse's nuclear projects. Westinghouse, in turn, would like to rid itself of the US AP1000 reactors projects and keep its profitable operations but must instead sell profitable operations to cover debts from the reactor projects.

No amount of ring-fencing will make the AP1000 problems go away. According to Westinghouse, an additional US$4 billion is required to complete the four reactors (US$2.5 billion in Georgia and US$1.5 billion in South Carolina).13 That figure may be an underestimate. Southern Co. CEO Thomas Fanning has said the company needs at least US$3.7 billion needs to complete the two reactors in Georgia ‒ possibly more.18,19

If the additional costs can be kept to US$3.7 billion, Southern Co. hopes that funding from Toshiba will suffice to complete the reactors in Georgia.19 Of course, those hopes could be dashed if Toshiba seeks protection under Japanese corporate reorganization laws.

Southern Co. subsidiary Georgia Power is also trying to convince the Georgia Public Service Commission to allow it to recoup further costs from ratepayers in Georgia, but the Commission appears reluctant.19 Georgian ratepayers have already been paying for the construction of the two AP1000 reactors since 2011, based on provisions of the 2009 Georgia Nuclear Finance Act.20,21

Tax credits and loan guarantees

The AP1000 reactors in Georgia and South Carolina need to be operating by the end of 2020 to be eligible for a US$18/MWh federal production tax credit. For the South Carolina project, the tax credit would amount to a government subsidy of about US$2.2 billion.22 Relaxation of the 2020 deadline for the tax credits is shaping as an important determinant of the future of the four reactors given the receding likelihood of completing the reactors by then. South Carolina Electricity & Gas recently said it is re-evaluating its timeline for completion of the two reactors in that state because of Westinghouse's "historical inability to achieve forecasted productivity and work for efficiency levels" and in light of Westinghouse's bankruptcy filing.23

The extension of the tax credits is "absolutely imperative" to the AP1000 projects and "next-up U.S. nuclear projects" according to David Blee, executive director of the US Nuclear Infrastructure Council.24 However an attempt to include a relaxation of the 2020 deadline in a government spending bill recently failed.25 Congressional leadership is reportedly delaying the issue until lawmakers take up tax reform later this year24 ‒ but that could be too late to save the AP1000 projects. Republican senator Lindsey Graham said: "I'm not going to sit on the sidelines and watch the nuclear industry be destroyed. For three years, we've been trying to get these tax credits extended. ... The reactors that are being built are very much at risk."24

If the Vogtle project in Georgia collapses, the federal government is on the hook for US$8.3 billion in loan guarantees. Ryan Alexander, president of Taxpayers for Common Sense, said:26

"The Title XVII program at the Energy Department provides broad authority for it to guarantee loans for early commercial use of advanced technologies if there is a "reasonable" prospect of repayment by the borrower. Loan guarantees are like cosigning a loan. The government (taxpayers) are on the hook for repayment of the loans if the borrower defaults.

"Building a nuclear reactor – two nuclear reactors – is expensive and risky. The amount of risk represented by a particular loan guarantee is measured in the project's "subsidy cost." The higher the risk, the higher the cost that gets assigned to the guarantee. You would think a loan guarantee for a nuclear power plant – the riskiest project of all – would be assessed a pretty high price. It should have been. But the Energy Department guaranteed at least $6.5 billion of the $8.3 billion total at a cost of $0. That is, it recorded no potential liabilities for its guarantee of more than $6 billion in loans for the construction of two nuclear power plants. ...

"While this might mean huge losses for taxpayers, the real tragedy is that financial entanglement with the project could have been avoided altogether. It's not clear what the Department of Energy can do now to mitigate the potential for losses. In the end, the Vogtle mishap could be a very expensive way to learn what we should have known all along – the federal government cannot ignore risk when taxpayers' money is on the line."

The plan for AP1000 reactors in the UK

NuGen was established in 2009 as a consortium between Engie, Iberdrola, and Scottish and Southern Energy. After various twists and turns, Toshiba had a 60% stake in NuGen and Engie the remaining 40% by the end of 2013. In 2014, NuGen announced plans to build three AP1000 reactors at Moorside, near Sellafield in the UK. But Engie has exercised its contractual right to force Toshiba to buy its 40% stake. Toshiba wanted to sell its 60% stake ... and now wants to sell its 100% stake.

Reactor construction never began and likely never will. In April 2017, NuGen said it has put its application for development consent on hold and is "undertaking a strategic review of its options following shareholder and vendor challenges".27 The consortium has written to suppliers to warn them it will have to cut spending, and also plans to order staff who have been seconded to the project from other companies to return to their employers.28

Toshiba (and the British government and others) are hoping that South Korean utility Kepco will buy a stake in NuGen (Toshiba presumably hopes Kepco will buy its entire 100% stake). Kepco has been considering buying a stake in NuGen for some time, but a deal has not been struck. Kepco may prefer to build its APR1400 reactors rather than Westinghouse AP1000 reactors, which would delay the project by several years: the APR1400 design has not been approved by UK regulators whereas the AP1000 design recently received approval.

Some see Kepco's purported interest in building its own reactor technology as a bargaining chip to use in negotiations. Kepco might agree to build AP1000 reactors ‒ or to be the engineering, procurement, and construction manager of Westinghouse-built AP1000 reactors ‒ on the condition that Kepco supplies expensive items like steam generators, turbines, pumps, and other system components.29

A Hinkley Point-style guaranteed 'strike price' per kilowatt-hour might make the project attractive for Kepco, but still the question remains: where will the capital costs for the three-reactor project ‒ which could amount to US$20 billion or so ‒ come from? One pro-nuclear commentator suggests that the project could be revived with a guaranteed strike price plus UK government-issued bonds covering the capital costs.29 The commentator also recommends following through on BREXIT in order to prevent any challenge under EU legislation to the subsidies required to get the Moorside project off the ground (Austria and others challenged the Hinkley Point subsidies).

NuGen chief executive Tom Samson said in early May that the project faces "significant challenges" and that direct government funding is one option on the table. He said: "We already have tremendous support from the government, we look for all opportunities to secure funding for the Moorside project and the government's involvement is one of those areas we'll continue to explore."27

Plans for AP1000 reactors in India

A. Gopalakrishnan, a former Chair of India's Atomic Energy Regulatory Board, has written an opinion piece in The Hindu strongly criticizing plans to contract Westinghouse to build six AP1000 reactors in India.30

Gopalakrishnan wrote:30

"India must not enter into a contract involving billions of dollars with an American company that has already declared bankruptcy. ... Westinghouse going into bankruptcy causes much larger problems than just the financial consequences. With the bankruptcy filing, no creditors will come forward to lend the approximately $7 billion needed to bankroll the India project in the first phase. During the time of the Barack Obama administration, India had hoped to get a U.S. Export-Import (Exim) Bank loan for the Kovvada project. But with Donald Trump assuming the U.S. presidency and Westinghouse perilously in the red, there is little chance that the new American administration will favourably consider an Exim Bank loan for an Indian nuclear project to be technologically executed by a bankrupt U.S. company. Even if the Trump administration is willing, the project is definitely not in the interest of the people of India.

"From personal contacts, I understand that senior and mid-level Westinghouse managers and technical staff have already started looking for other jobs. The company will find itself hard-pressed to handle the completion of the eight AP1000 reactors for the U.S. and China that it is committed to, let alone competently take on and complete a new two-reactor project in Kovvada. Besides, six-eight years from the start of construction, which competent Westinghouse engineering team will be around to help India start up these reactors and provide periodic assistance thereafter? ...

"In view of these difficulties, it is best to completely keep away from agreeing to purchase the Westinghouse AP1000 reactors. In fact, the current status of world energy technology does not warrant the inclusion and consideration of nuclear power of any kind in the energy basket of our nation."

Dr Vijay Sazawal, a former Westinghouse employee who is now a member of the Civil Nuclear Trade Advisory Committee of the US Department of Commerce, also urged caution.31 He said: "Basically, Westinghouse has backed out of the contracts in place [in the US] and will renegotiate contracts with those utilities which will have to bear previous cost overruns on their projects. So both Westinghouse and a new potential customer like NPCIL in India will have to be very careful in their financial negotiations in order to ensure that Westinghouse does not back out of its legal and financial obligations if it hits a road bump as it has in its four nuclear power plants under construction in the US and China, with all four plants having exceeded their original cost and schedule commitments."

References:

1. 17 April 2017, 'The Westinghouse Bankruptcy: Test for Chinese Investment in US Infrastructure', www.ippreview.com/index.php/Blog/single/id/405.html

2. Tom Hals / Reuters, 3 May 2017, 'Westinghouse, CB&I spar in court over $2 bln merger dispute', www.reuters.com/article/us-toshiba-accounting-westinghouse-cbi-idUSKBN17...

3. Tom Hals and Emily Flitter, 2 May 2017, 'How two cutting edge U.S. nuclear projects bankrupted Westinghouse', http://uk.reuters.com/article/us-toshiba-accounting-westinghouse-nucle-i... and see also http://fingfx.thomsonreuters.com/gfx/rngs/TOSHIBA-ACCOUNTING/010040WY1YE...

4. World Nuclear News, 24 April 2017, 'Toshiba creates subsidiaries 'to maximise value'', www.world-nuclear-news.org/C-Toshiba-creates-subsidiaries-to-maximise-va...

5. Kana Inagaki, 24 April 2017, 'Toshiba to restructure to protect core businesses', www.ft.com/content/780ae574-28df-11e7-9ec8-168383da43b7
6. Kana Inagaki, 2 May 2017, 'Brave is the auditor that takes on Toshiba's accounts', www.ft.com/content/d5709622-2ef8-11e7-9555-23ef563ecf9a
7. Intellasia, 28 April 2017, 'Toshiba plans to replace auditor PwC after earnings impasse', www.intellasia.net/toshiba-plans-to-replace-auditor-pwc-after-earnings-i...

8. Quentin Webb, 26 April 2017, Unaccountable, www.breakingviews.com/considered-view/toshiba-axing-pwc-would-be-ugly-bi...

9. BBC, 14 Feb 2017, 'Toshiba chairman quits over nuclear loss', www.bbc.com/news/business-38965380

10. 16 April 2017, 'Toshiba: loses access to unit's cash after hedge fund sues', www.4-traders.com/TOSHIBA-CORP-6493713/news/Toshiba-loses-access-to-unit...

11. Leisha Chi / BBC, 16 April 2017, 'Can Toshiba escape the clutches of corporate Japan's zombie hordes?', www.bbc.com/news/business-39585758

12. Takashi Mochizuki, Mayumi Negishi, and Kosaku Narioka, 9 May 2017, 'Toshiba partners brace for possible bankruptcy filing', www.wsj.com/articles/toshiba-partners-brace-for-possible-bankruptcy-fili...

13. World Nuclear News, 28 April 2017, 'US industry on tenterhooks over Westinghouse: NEI', www.world-nuclear-news.org/C-US-industry-on-tenterhooks-over-Westinghous...

14. Augusta Chronicle, 3 May 2017, 'Too important to fail', http://chronicle.augusta.com/opinion/editorials/2017-05-03/too-important...

15. Kristi E. Swartz, 20 April 2017, 'Vendors line up to demand returns from Westinghouse', www.eenews.net/energywire/2017/04/20/stories/1060053327

16. Anya Litvak, 28 April 2017, 'Westinghouse battles trust issues with vendors, customers and employees', http://powersource.post-gazette.com/powersource/companies/2017/04/27/EQT...

17. Reuters, 28 April 2017, 'Westinghouse says will operate normally in Asia, Europe despite Chapter 11', https://finance.yahoo.com/news/westinghouse-says-operate-normally-asia-0...

18. Power Engineering, 4 May 2017, www.power-eng.com/articles/2017/05/southern-company-requests-3-7-billion...

19. Kristi E. Swartz, 5 May 2017, 'Tug of war in Ga. over who controls Vogtle's fate', www.eenews.net/energywire/2017/05/05/stories/1060054108

20. Anne Maxwell, 8 May 2017, 'Georgia Power profits off Plant Vogtle construction despite cost overruns, delays, and contractor bankruptcy', http://wjbf.com/2017/05/08/georgia-power-profits-off-plant-vogtle-constr...

21. Georgia Watch, 'Protect Georgia Power Customers from Massive Cost Overruns', www.georgiawatch.org/issue/protect-georgia-power-customers-from-massive-...

22. David Wren, 27 April 2017, 'SCANA exec: Nuclear plant completion could hinge on extension of federal tax credits', www.postandcourier.com/business/scana-exec-nuclear-plant-completion-coul...

23. World Nuclear News, 8 May 2017, 'Summer plant construction progress continues', www.world-nuclear-news.org/NN-Summer-plant-construction-progress-continu...

24. Andrew Follett, 5 May 2017, 'Congress Gears Up For Showdown Over Billions In Nuclear Tax Credits', http://dailycaller.com/2017/05/05/congress-gears-up-for-showdown-over-bi...

25. Kristi E. Swartz, 4 May 2017, 'Southern turns to D.C. for help to finish reactors', www.eenews.net/stories/1060054028

26. Ryan Alexander 6 April 2017, 'The High Cost of Ignoring Risk', www.usnews.com/opinion/economic-intelligence/articles/2017-04-06/westing...

27. ITV, 3 May 2017, 'Exclusive: NuGen CEO certain Moorside nuclear development will go ahead', www.itv.com/news/border/2017-05-03/exclusive-nugen-ceo-certain-moorside-...

28. John Collingridge, 30 April 2017, 'Toshiba mothballs Cumbrian nuclear power project', www.thetimes.co.uk/article/toshiba-mothballs-cumbrian-nuclear-power-proj...

29. Dan Yurman, 8 April 2017, 'A Modest Proposal to Save NuGen's Moorside Nuclear Project', http://neutronbytes.com/2017/04/08/a-modest-proposal-to-save-nugens-moor...

30. A. Gopalakrishnan, 31 March 2017, 'Say no to Westinghouse', www.thehindu.com/opinion/op-ed/say-no-to-westinghouse-india-must-not-ent...

31. PTI, 30 March 2017, 'Westinghouse bankruptcy unlikely to impact Indo-US N-deal', www.financialexpress.com/india-news/westinghouse-bankruptcy-unlikely-to-...

Fukushima Bill

Nuclear Monitor Issue: 
#841
4635
12/04/2017
Shaun Burnie ‒ senior nuclear specialist with Greenpeace Germany, Tokyo.
Article

Six years after Japan's Fukushima nuclear accident, three global nuclear corporations are fighting for their very survival. The bankruptcy filing by Westinghouse Electric Co. and its parent company Toshiba Corp. preparing to post losses of ¥1 trillion (US$9 billion), is a defining moment in the global decline of the nuclear power industry.

However, whereas the final financial meltdown of Westinghouse and Toshiba will likely be measured in a few tens of billions of dollars, those losses are but a fraction of what Tokyo Electric Power Co. (Tepco) is looking at as a result of the Fukushima nuclear disaster.

If the latest estimates for the cost of cleaning up the Fukushima plant prove accurate, Tepco faces the equivalent of a Toshiba meltdown every year until 2087. In November 2016, the Japanese Government announced a revised estimate for the Fukushima nuclear accident (decommissioning, decontamination, waste management and compensation) of ¥21.5 trillion (US$193 billion) – a doubling of their estimate in 2013.

But the credibility of the government's numbers has been questioned all along, given that the actual 'decommissioning' of the Fukushima plant and its three melted reactors is entering into an engineering unknown.

This questioning was borne out by the November doubling of cost estimates after only several years into the accident, when there is every prospect Tepco will be cleaning up Fukushima well into next century.

And sure enough, a new assessment published in early March from the Japan Institute for Economic Research, estimates that total costs for decommissioning, decontamination and compensation as a result of the Fukushima atomic disaster could range between ¥50‒70 trillion (US$449‒628 billion).

If confirmed over the coming years, it will be the most expensive industrial accident in history with even greater implications for the people and energy future of Japan.

Rather than admit that the Fukushima accident is effectively the end of Tepco as a nuclear generating company, the outline of a restructuring plan was announced in late March.

Tepco Holdings, the entity established to manage the destroyed nuclear site, and the Nuclear Damage Compensation and Decommissioning Facilitation Corporation (NDF) are seeking ways to sustain the utility in the years ahead, confronted as they are with escalating Fukushima costs and electricity market reform.

The NDF, originally established by the Government in 2011 to oversee compensation payments and to secure electricity supply, had its scope broadened in 2014 to oversee decommissioning of the Fukushima Daiichi plant on the Pacific Ocean coast north of Tokyo.

The latest restructuring plan is intended to find a way forward for Tepco by securing a future for its nuclear, transmission and distribution businesses. If possible in combination with other energy companies in Japan.

But the plan, already received less than warmly by other utilities rightly concerned at being burdened with Tepco's liabilities, is premised on Fukushima cost estimates of ¥21.5 trillion, not ¥50‒70 trillion.

To date Tepco's Fukushima costs have been covered by interest-free government loans, with ¥6 trillion (US$57 billion) already paid out. Since 2012 Tepco's electricity ratepayers have paid ¥2.4 trillion to cover nuclear-related costs, including the Fukushima accident site.

That is nothing compared to the costs looming over future decades and beyond and it comes at a time when Tepco and other electric utilities are under commercial pressure as never before. The commercial pressure comes from electricity market reform that since April 2016 allowed consumers to switch from the monopoly utilities to independent power providers. In the ten months to February 2017, the main electric utilities lost 2.5 million customers, with Tepco alone losing more than 1.44 million. Hence, profits have fallen off a cliff.

Prior to the deregulation of the retail electricity market, Tepco had 22 million customers. As the Tepco president observed late last year: "The number (of customers leaving Tepco) is changing every day as the liberalization continues … We will of course need to think of ways to counter that competition."

Countering that competition shouldn't mean rigging the market, yet Tepco and the other utilities intend to try and retain their decades long dominance of electricity by retaining control over access to the grid. This is a concerted push back against the growth of renewable energy.

Current plans to open the grid to competition in 2020, so called legal unbundling, are essential to wrest control from the big utilities. The message of unbundling and independence, however, doesn't seem to have reached the Ministry of Economy, Trade and Industry (METI) that oversees the electricity industry.

Current plans would allow Tepco to establish separate legal entities: Tepco Fuel & Power (thermal power generation), Tepco Energy Partner (power distribution) and Tepco Power Grid (power transmission). Tepco Holdings will retain their stock and control their management, meaning the same monopoly will retain control of the grid. Where Tepco leads, the other nine electric utilities aim to follow.

Leaving the grid effectively still under the control of the traditional utilities will throw up a major obstacle to large scale expansion of renewable energy sources from new companies. Such businesses will be 'curtailed' or stopped from supplying electricity to the grid when the large utilities decide it's necessary, justified for example to maintain the stability of the grid.

The fact that 'curtailment' will be permitted in many regions without financial compensation piles further pain onto new entrants to the electricity market, and by extension consumers.

Further, METI plans to spread the escalating costs of Fukushima so that other utilities and new power companies pay a proportion of compensation costs. METI's justification for charging customers of new energy companies is that they benefited from nuclear power before the market opened up.

The need to find someone else to pay for Tepco's mess is underscored by the breakdown of the Fukushima disaster cost estimate in November.

When put at an estimated ¥22 trillion, ¥16 trillion is supposed to be covered by Tepco. The Ministry of Finance is to offer ¥2 trillion for decontamination, and the remaining ¥4 trillion is to be provided by other power companies and new electricity providers.

The question is how does Tepco cover its share of the costs when it's losing customers and its only remaining nuclear plant in Japan, Kashiwazaki Kariwa (the world's largest), has no prospect of restarting operation due to local opposition?

What happens when Fukushima costs rise to the levels projected of ¥50‒70 trillion?

The policy measures being put in place by Tepco, other utilities and the government suggests that they know what is coming and their solution for paying for the world's most costly industrial accident will be sticking both hands into the public purse.

Reprinted from Asia Times, 31 March 2017, www.atimes.com/article/tepcos-fukushima-expensive-industrial-accident-hi...

Will Westinghouse and Toshiba survive?

Nuclear Monitor Issue: 
#841
4632
12/04/2017
Jim Green ‒ Nuclear Monitor editor
Article

On March 29, the day that Westinghouse filed for Chapter 11 bankruptcy protection in New York, Bloomberg noted: "Westinghouse Electric Co., once synonymous with America's industrial might, wagered its future on nuclear power ‒ and lost."1

Whether Westinghouse will survive is an open question. Toshiba said on March 29 that Westinghouse has debts totalling US$9.8 billion and the bankruptcy filing is a clear indication that the company's viability is in doubt.2

Toshiba would sell Westinghouse if it could find a buyer, but it can't. Toshiba has tried but failed to sell Westinghouse several times already.3 Incredibly, Toshiba chief executive Satoshi Tsunakawa said in mid-March that Toshiba might have to pay a buyer to take Westinghouse off its hands.4 Presumably a utility or company willing to accept Westinghouse (along with a payment) would also be taking on a debt load as well as future risks associated with Westinghouse's nuclear business.

The Financial Times reported on March 5: "Mitsubishi this month ruled out rescuing the US company, citing its partnership with Areva, the troubled French reactor designer. Hitachi, which makes reactors with GE, also said it would not invest in Westinghouse, highlighting technology differences. GE is also thought to be highly unlikely to have any interest in Westinghouse. GE declined to comment. EDF, the French power company that is planning to buy a controlling stake in Areva's reactor business, is not expected to pursue Westinghouse. An EDF spokesperson said buying Westinghouse was "not in our plan"."3

South Korea's Kepco is seen as a possible buyer of Westinghouse, or parts of Westinghouse, and Kepco is also seen as a possible saviour of Toshiba's NuGen reactor project at Moorside in the UK. George Borovas from law firm Shearman & Sterling said: "It is therefore possible that some kind of 'package deal' could be structured for a strategic Korean investment into Westinghouse and NuGen at the same time."3

But Suh Kyun-ryul, professor of atomic engineering at Seoul National University, asked: "Why should [Kepco] take such big financial risks by taking over a troubled business amid the gloomy industry outlook?"3 And Kepco president Cho Hwan-eik was unequivocal in his comments on March 22: "We have no plan to acquire Toshiba's stake [in Westinghouse] ... there is no role for us there".5

There is speculation that Chinese utilities might be interested in buying Westinghouse ... if only because just about every other possibility has been ruled out.6 None of the speculation about a Chinese buy-out addresses the point that Chinese interests are no more likely to be interested in a bankrupt company than anyone else. Speculation about a Chinese buy-out has been laced with warnings about the 'need' to keep Westinghouse out of Chinese hands for various non-descript 'national interest' and 'national security' reasons.7

Bloomberg reports that Westinghouse has been a repeated target of Chinese espionage.7 Five Chinese military officials were indicted in absentia in 2014 for allegedly stealing trade secrets from Westinghouse through computer hacks, and China General Nuclear Power Corp. was indicted in 2016 for conspiring to steal restricted nuclear technology from Westinghouse.7

US officials are reportedly examining three options to keep Westinghouse out of Chinese hands: blocking a sale to a Chinese buyer (assuming there is a Chinese buyer ... which seems to be the elephant in the room ... at the moment there isn't a buyer); encouraging a bid from US investors or US-allied foreign investors; or direct US government investment in Westinghouse in return for an equity stake.7

A carve-up of Westinghouse is possible with profitable operations sold off to lessen existing debts. Jose Emeterio Gutierrez, interim president and CEO of Westinghouse, said in early April: "It's a reality that we have this problem with the construction of the US AP1000 projects, but it's also true that the rest of the company is in good shape. It's a healthy business. We don't have significant problems."8

But Westinghouse may have to sell profitable operations to stave off bankruptcy and may be left with little or nothing other than the high-risk, heavily-indebted AP1000 reactor projects in the US. George Borovas from law firm Shearman & Sterling said: "Any sale would likely be preceded by a restructuring of Westinghouse so that the 'new Westinghouse' being sold would be free of any liabilities arising from the current new build projects that Westinghouse is constructing."6

Toshiba itself is already in precisely that situation: reluctantly selling profitable parts of its business to stave off bankruptcy and being left holding an unwanted atomic bomb.

Currently, Toshiba is being forced to increase its 87% stake in Westinghouse. Japanese company IHI Corporation is exercizing its put option to sell its 3% stake of Westinghouse to Toshiba for US$157 million.9 KazAtomProm owns the remaining 10% of Westinghouse and may also exercize its right to sell its stake to Toshiba on or after 1 October 2017.10

On a brighter note, Jose Emeterio Gutierrez, interim president and CEO of Westinghouse, recently told staff that the company's decommissioning business currently brings in almost US$100 million a year and could easily double or triple in the next few years.8 He pointed to plants at risk of early closure in the US and fleets in countries like Germany that are phasing out nuclear power altogether after the Fukushima disaster. "The market is huge. Also, it's not a market that is short term," he said.8

Will Toshiba survive?

Toshiba said in February that it expects to book a US$6.3 billion writedown on Westinghouse11, on top of a US$2.3 billion writedown in April 2016.12 The losses exceed the US$5.4 billion Toshiba paid when it bought a majority stake in Westinghouse in 2006.11

Now Toshiba says there is "substantial doubt about the Company's ability to continue as a going concern".13

Toshiba's demise is a crushing blow to Japan's nuclear industry ... which was already crushed by the Fukushima disaster. Nikkei Asian Review commented on April 10:14

"Japan's nuclear power industry is at the most critical juncture in its history. Demand for new reactors has dried up at home following the Fukushima nuclear disaster and dismal prospects for export are dual menaces threatening the fate of the country's nuclear technology. No domestic construction on a new reactor has begun for the past eight years. The catastrophic accident at the Fukushima Daiichi nuclear power plant in 2011 blew a hole in the industry's plans. The picture for exports of Japanese nuclear power technology looks just as gloomy. Japanese reactor manufacturers and suppliers of key components are now facing the possible loss of their technological viability."

Toshiba's decision to have its subsidiary Westinghouse file for bankruptcy protection may put some boundaries around future liabilities and losses, particularly those associated with the US AP1000 projects. But Toshiba will still be responsible for guaranteeing roughly ¥650 billion (US$5.9bn) worth of Westinghouse debt if the nuclear projects are delayed due to the bankruptcy filing, and Toshiba also needs to set aside about ¥170 billion (US$1.54bn) in loan-loss provisions in case loans to Westinghouse prove unrecoverable.15

The US government is also on the hook due to its US$8.3 billion loan guarantee for the two AP1000 reactors under construction in Georgia.16 A Department of Energy spokesperson said the agency is "keenly interested" in Westinghouse's bankruptcy proceedings and that the administration expects all companies to "honor their commitments" to finish the project.16 If Westinghouse cannot complete the reactors, repayment of the loans will likely be delayed, in which case the government would take on the debt. Nikkei Asian Review reported on March 11: "It remains unclear how Washington and Toshiba would split the costs in this case. But the possibility that American taxpayers could bear some of the burden has spurred negotiations involving the U.S. and Japanese governments to settle the matter."17

The BBC noted on March 29 that Toshiba's share-price has been in freefall, losing more than 60% since the company first unveiled the massive cost overruns with US reactor projects in December 2016.18

Standard & Poor's cut its credit rating on Toshiba on March 17, down two notches to CCC-, pushing it further into junk status after previous downgrades in December and January.19

Toshiba is selling profitable businesses to stave off bankruptcy, including its highly-profitable memory chip business. Toshiba will need to earn about ¥1 trillion (US$9.1bn) from the sale to bring its net worth out of the red.15

Toshiba, Hitachi and Mitsubishi Heavy Industries were planning an integration of their nuclear fuel operations due to the protracted weakness of Japan's nuclear industry ‒ but that has stalled due to Toshiba's current crisis.20

A broader integration between the three companies would make sense according to Tom O'Sullivan from energy consultancy Mathyos Japan. "It would make sense. There's no point in having three companies chasing a dying market in Japan," he said.21 But Mitsubishi president and chief executive Shunichi Miyanaga ruled out a merger in mid-February22 and a Hitachi spokesperson said there are no discussions on merging the companies' overall nuclear operations.21 Nevertheless, the Japanese government might use whatever leverage it has to force a tie-up between the three companies.

There are conflicting reports as to whether Tokyo might use government funds to rescue Toshiba. Most of the statements from the government suggest that there will not be a government bail-out.23 But Nikkei Asian Review reported on March 18 that the Toshiba/Westinghouse crisis was discussed at a meeting between Japan's minister of economy, trade and industry and the US commerce secretary and energy secretary, and speculated that the two governments "seem to be softening on their previous stance that the company's restructuring is a private-sector matter."24

In February, Toshiba said it plans to exit the reactor construction business and focus its nuclear business on design, equipment supply and engineering services.25 That probably remains the plan, but comments by Toshiba chief executive Satoshi Tsunakawa on March 29 suggest a more complete withdrawal from the nuclear industry outside of Japan. "This is a de facto withdrawal from the overseas nuclear business for us. Therefore, we don't see any more risk," he said.

Whatever Toshiba does, it is still on the hook for multi-billion dollar liabilities associated with the AP1000 projects in the US.

References:

1. Chris Martin and Chris Cooper, 29 March 2017, 'How an American Tech Icon Bet on Nuclear ‒ and Lost its Way', www.bloomberg.com/news/articles/2017-03-29/how-an-american-tech-icon-bet...

2. Diane Cardwell and Jonathan Soble, 29 March 2017, 'Westinghouse Files for Bankruptcy, in Blow to Nuclear Power', www.nytimes.com/2017/03/29/business/westinghouse-toshiba-nuclear-bankrup...

3. Kana Inagaki and Song Jung-a, 5 March 2017, 'Kepco seen as potential buyer for Toshiba's ailing nuclear unit', www.ft.com/content/32f14d76-f8e6-11e6-9516-2d969e0d3b65
4. Makiko Yamazaki and Taiga Uranaka, 14 March 2017, 'Toshiba pushes sale of nuclear unit Westinghouse as crisis deepens', www.reuters.com/article/us-toshiba-accounting-idUSKBN16L02X

5. Song Jung-a in, 22 March 2017, 'Kepco rules out buying Westinghouse stake', www.ft.com/content/cd70d392-0ec8-11e7-b030-768954394623

6. Stephen Stapczynski, 13 March 2017, 'Troubled Nuclear Builder Seen Best Fit for Asian Ambitions', www.bloomberg.com/news/articles/2017-03-13/troubled-nuclear-builder-seen...

7. Jennifer Jacobs, Saleha Mohsin, and Jennifer A Dlouhy, 5 April 2017, 'Trump Team Takes Steps to Keep Chinese From Westinghouse', www.bloomberg.com/politics/articles/2017-04-04/trump-officials-alarmed-c...

8. Anya Litva, 11 April 2017, 'Westinghouse CEO tries to spread optimism despite bankruptcy', http://powersource.post-gazette.com/powersource/companies/2017/04/11/Wes...

9. Tom Hals and Jessica DiNapoli, 27 March 2017, 'Factbox: Toshiba's options in U.S. nuclear bankruptcy', www.reuters.com/article/us-toshiba-westinghouse-factbox-idUSKBN16Y2QP?il=0

10. World Nuclear News, 29 March 2017, 'Westinghouse files for US bankruptcy protection', www.world-nuclear-news.org/C-Westinghouse-files-for-US-bankruptcy-protec...

11. BBC, 14 Feb 2017, 'Toshiba chairman quits over nuclear loss', www.bbc.com/news/business-38965380

12. Reuters, 26 April 2016, 'Toshiba Takes $2.3 Billion Writedown on U.S. Nuclear Unit Westinghouse', http://fortune.com/2016/04/26/toshiba-writedown-westinghouse-nuclear/

13. Toshiba Corporation, 11 April 2017, 'Toshiba Announces Consolidated Results for the First Nine Months and the Third Quarter for Fiscal Year 2016, Ending March 2017', www.toshiba.co.jp/about/ir/en/finance/er/er2016/q3/ter2016q3e.pdf

14. Nikkei Asian Review, 10 April 2017, 'Japan's nuclear technology faces extinction', http://asia.nikkei.com/Business/Trends/Japan-s-nuclear-technology-faces-...

15. Nikkei Asian Review, 6 April 2017, 'Cutting Westinghouse loose puts Toshiba in a deeper hole', http://asia.nikkei.com/magazine/20170406/Business/Cutting-Westinghouse-l...

16. Peter Maloney, 3 April 2017, 'Westinghouse bankruptcy puts $8.3B in federal loan guarantees for Vogtle plant at risk', www.utilitydive.com/news/westinghouse-bankruptcy-puts-83b-in-federal-loa...

17. Nikkei Asian Review, 11 March 2017, 'Toshiba scrambles to stem further bleeding from Westinghouse', http://asia.nikkei.com/Spotlight/Toshiba-in-Turmoil/Toshiba-scrambles-to...

18. BBC, 29 March 2017, 'Toshiba's Westinghouse files for US bankruptcy', www.bbc.com/news/business-39424634

19. AFP, 17 March 2017, 'S&P cuts troubled Toshiba's credit rating', www.businesstimes.com.sg/consumer/sp-cuts-troubled-toshibas-credit-rating

20. Japan Times, 23 Feb 2017, www.japantimes.co.jp/news/2017/02/23/business/hitachi-toshiba-mitsubishi...

21. Aaron Sheldrick, 31 March 2017, 'Big in Japan? Hope at home for Toshiba's nuclear arm after U.S. debacle', www.reuters.com/article/us-toshiba-nuclear-idUSKBN17211S

22. Financial Times, 16 Feb 2017, 'Mitsubishi Heavy rules out Toshiba nuclear rescue', www.ft.com/content/0238df8c-f44f-11e6-8758-6876151821a6

23. Samantha Cheh, 3 April 2017, 'Never-ending misfortunes: Toshiba stuck in the news cycle from hell', http://techwireasia.com/2017/04/toshiba-stuck-newscycle-hell/

24. Nikkei Asian Review, 18 March 2017, 'Toshiba's trials entangle Tokyo, Washington', http://asia.nikkei.com/Spotlight/Toshiba-in-Turmoil/Toshiba-s-trials-ent...

25. Makiko Yamazaki, 14 Feb 2017, 'Delays, confusion as Toshiba reports $6 billion nuclear hit and slides to loss', http://uk.reuters.com/article/us-toshiba-accounting-idUKKBN15T033

26. Russell Gold and Mayumi Negishi, 31 March 2017, 'Ire at Toshiba's nuclear backdown', www.wsj.com/articles/toshibas-westinghouse-electric-files-for-bankruptcy...

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