Compensation

June 27, 2012

TEPCO head defends utility's safety steps / Katsumata believes nuclear compensation law needs to be revised to stipulate who is responsible

The Yomiuri Shimbun

http://www.yomiuri.co.jp/dy/national/T120626005085.htm

Tsunehisa Katsumata, chairman of Tokyo Electric Power Co., says the safety measures the utility has taken at the Fukushima No. 1 nuclear power plant are "sufficient."

In his first interview with The Yomiuri Shimbun since the March 11, 2011, disaster triggered the nuclear crisis at the Fukushima plant, Katsumata said, "We take note of all new information [such as from the government and academic societies] and make decisions based on established findings."

Asked about a report that then TEPCO President Masataka Shimizu told the government the company planned to withdraw all workers from the Fukushima plant, Katsumata said, "From the start, we never considered pulling out all our staff."

"The plant director at the time [Masao Yoshida] told the leader of each team to ask suitable people to stay, and about 70 did so," he added.

On another issue, Katsumata criticized the Nuclear Damages Compensation Law as "flawed."

"The law should state whether nuclear power should be handled by the private sector or the state and stipulate who is liable and responsible [for nuclear power]," he said.

Katsumata apparently views the law as a more pressing issue than TEPCO's responsibility as the operator of a plant that caused the nuclear crisis.

"When an accident occurs, can we force [workers] to stay [on-site] if we thought they would die? It's a difficult legal issue," he said.

As for the government's decision to help TEPCO pay compensation by providing public funds totaling 1 trillion yen, Katsumata said, "I think the government reached the conclusion that TEPCO should not go bankrupt because of the enormous burden the public would have to shoulder if the state had to cover all costs arising from compensation, decommissioning of reactors and decontamination."

Katsumata became TEPCO president in 2002 and assumed the current chairmanship in 2008. After the nuclear crisis occurred, he took command to bring the crippled plant under control and dealt with the compensation issue.

He is expected to resign as chairman and become a "shayu" (company friend) of the utility at its general shareholders meeting on Wednesday.

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Ambiguity of compensation law

By Chiaki Toyoda / Yomiuri Shimbun Staff Writer

The Fukushima nuclear crisis has shed light on the ambiguity of the Nuclear Damages Compensation Law, which has led to a delay in compensation payments to people affected by the nuclear crisis and implementation of decontamination measures.

The government has decided to review the law, but discussions have made no progress.

The law discharges an electric power company from liability for a nuclear accident caused by a massive natural disaster or social convulsion. TEPCO could ask for this provision to be applied to the crisis at the Fukushima plant.

However, Katsumata apparently believes the utility would not receive public funds and financial aid from banks and could end up going bankrupt if it fights prolonged lawsuits. People directly affected by the crisis and public sentiment would become even more hostile toward the utility.

TEPCO's decision not to take advantage of the provision could mean it cannot effectively be used whenever a nuclear crisis occurs.

The Diet decided to review the law a year after the onset of the nuclear crisis. However, the government has yet to hold discussions on the matter as it has not even decided on a midterm plan on the share of generation of each energy source.

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Responsibility is unclear

The Fukushima crisis also has posed a great challenge to the utility over how to protect the lives of workers who fought to bring the situation under control.

Four days after the disaster hit the Fukushima plant, then Prime Minister Naoto Kan visited TEPCO's headquarters and reportedly said: "Withdrawal is impossible. It doesn't matter if senior officials aged over 60 go to the site and die."

Kan's reported action indicates the nation lacks clear legal provisions on responding to a serious nuclear accident. Discussions, such as whether nuclear power should be managed and operated by the state, are needed.

Asked how he would have dealt with the crisis if it had become more serious, Katsumata said it was legally difficult for the company to order its staff to stay at such a dangerous site.

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Who should cover costs?

The law is also unclear as to whether TEPCO or the state should pay compensation and shoulder the cost of decommissioning the reactors and decontamination.

The government believes TEPCO should pay for decommissioning of reactors and the decontamination work. It also thinks the cost of decontamination already paid by the central and local governments should eventually be repaid by TEPCO. However, if TEPCO is forced to foot the entire bill, the utility could go bankrupt.

If that happens, TEPCO's stocks would become scrap paper and creditor banks would suffer massive losses. Problems in the framework that supports TEPCO may become more evident and a review on the law will become inevitable.