Japan's Current Nuclear Energy Policy

JapansCurrentNuclearEnergyPolicy

Hirobumi Kayama

AgencyforNaturalResourcesandEnergy,METIJune,2015

1. Nuclear Energy Policy in New Strategic Energy Plan of Japan

2. Efforts toward Restoration and Reconstruction of Fukushima

3. Existing Light Water Reactors

4. Reconstruction of Safety Culture

5. Promotion of Strategic Development of Technologies and

Human Resources

6. Establishment of Appropriate Business Environment under the

More Competitive Market

7. Contribution to Peaceful Use of Nuclear Power and Nuclear

Non-proliferation in the World

Table of Contents

1

2.Basicpolicyregardingmeasuresconcerningenergysupplyanddemand

1.IssuesrelatedtotheenergysupplydemandstructureinJapan Concerns over the safety of nuclear power generation and deteriorated public confidence in the

government and operators Outflow of national wealth and increase in dependency on the Middle East, price of electricity and

greenhouse gas emission in Japan due to higher dependency on fossil fuels North America's move toward independency of its energy supply by the shale-gas revolution and

widening gap of regional energy prices in the world

We will do our utmost to achieve the reconstruction and recovery of Fukushima while reflecting on thepains felt by the people affected by the accident at TEPCOs Fukushima nuclear accident. Needless tosay, that is the starting point for rebuilding Japans energy policy.

Introduction

To pursue "Energy Security", "Economic Efficiency" and "Environment" on the premise of "Safety" as the basic viewpoint, in consideration of "global viewpoint" and "economic growth

"Multilayered" supply structure where the strength of each energy source is to be maximized byappropriately offsetting each other's weakness

More "flexible and efficient" energy supply-demand structure where various options are to be preparedby various suppliers

Description in the Strategic Energy Plan of Japan

1. Nuclear Energy Policy in the New Strategic Energy Plan of JapanDecided by the Cabinet in April, 2014

2

TheGreatEastJapanEarthquake,TEPCOsFukushimanuclearaccident(March2011)

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0

500

1000

1500

2000

2500

3000

3500

1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012

Thermalpowerratio

Nuclearpowerratio

1973oilcrisis(October1973)

ThreeMileIslandaccident(March1979)

Chernobylaccident(August1986)

ActivationoftheFrameworkConventiononClimateChange(March1994)

MalreportingincidentbyTEPCO(August2002)

NiigataChuetsuEarthquake,temporaryshutdownofTEPCOsKashiwazaki KariwaNPS(2007~)

1979oilcrisis(1979)

hundredmillionkWh

AftertheGreatEastJapanEarthquakeandTEPCOs FukushimaDaiichiNuclearaccidentin2011,allnuclearpowerplants(NPPs)areinastateoftemporaryshutdown.

(Ref.)ChangeofNuclearPowerGenerationOutputinJapan

3

Increase in dependency on fossil fuels from overseasFuel for 88% of total power generation is imported from overseas. FY2013

Before the Earthquake, it was 61% in FY 2010. dependency on the Middle EastCrude oil (83), Natural gas (30)Ratio of renewable energy : About 2.2% of total power generation (where Hydro

power generation is not included) FY2013Increase in fuel cost (due to increase in thermal power generation)

About 3.4 trillion yenNational burden is about 30 thousand yen/person.)estimation in FY2014Increase in price of electricity

An average of about 20% increase from the level before the disastermonthly price of standard familyTEPCO about 6,300yen about 8,600yen

KEPCO about 6,400yen about 8,200yenExpenditures for the Feed-in-Tariff system of renewables is about 650 billion

yen/year which corresponds to 2,700yen/year for standard family)FY2014

Increase in greenhouse gas emissions as of FY2013The amount of CO2 emissions from general electricity utilities increased by about 110 million tons in FY2013 compared to FY2010. (about 9% of the total Japans CO2 emission)

EnergySecurity

NationsLifeand

Economy

ClimateChange

(JPY1,000=EUR7.6)

(Ref.)AdverseEffectsduetoShutdownofNPPsaftertheDisaster

4

Nuclear power is an important base-load power source as a low carbon and quasi-domestic energy source, contributing to stability of energy supply-demand structure,on the major premise of ensuring of its safety, because of the perspectives;

i. superiority in stability of energy supply and efficiency,ii. low and stable operational cost andiii. free from GHG emissions during operation.


5

(Ref.)ConstitutionofElectricPowerSupplyCorrespondingtoDemand

(1)Suppliercountriesbyfuels

Enriched uranium fuel is superior to oil and gas in terms of stable supply because locations of the uranium mines are relatively diversified.

The energy efficiency of uranium is much better than that of oil, gas and coal, when generating electricity. In fact, an uranium fuel can burn for about a year without reload, and thus this can be seen as a more effective strategic stockpile.

In addition, spent nuclear fuel can be recycled by reprocessing. With these reasons, nuclear energy can be evaluated as a quasi-domestic energy source.

Enriched Uranium Approx.2years

LNG Approx.13daysOil Approx.67days

NationalStockpile:Approx.85days

Coal Approx.33days

(3)DomesticFuelStockpilesbyprivatecompanies

Enriched Uranium

LNG

Oil

Coal

21 tons: 2.1 units of 10-ton truck

0.95 million tons: 4.75 LNG ships

1.55 million tons:7.75 large oil tankers

2.35 million tons:11.75 large coal vessels

DataSource:Nuclear2010byANRE

(2) Fuelforoneyearoperationof1,000MWpowerplant

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Saudi Arabia

UAE

Qatar

KuwaitIran

IraqOman

RussiaIndonesia

VietNamOthers

Qatar

UAEOman

Australia

Malaysia

Indonesia

Brunei

Russia

Nigeria

Australia

Indonesia

ChinaRussia

Canada

Canada

Kazakhstan

UzbekistanAustralia

Niger

MalawiSouthAfrica

Oil LNG Coal Uranium

NorthAmerica

Otherareas

Europe

MiddleEast

Africa

Asia

Regions

Datasource:TradeStatistics2012byMOFofJapan

DependenceonME83%DependenceonHolmes80%

DependenceonME30%DependenceonHolmes25%

OthersOthers Others

(Ref.)EvaluationofNuclearPowerGeneration (1) EnergySecurity

6

3.1 2.1 1.0

12.15.8 8.5 7.6 3.0

3.8~11.4

17.923.9

1.1 2.20.63.3

1.7 0.6

3.4

5.1 2.312.8

4.2

2.6~7.7

3.0

3.4

1.7 2.31.5 5.5 10.8

21.0

21.7

15.6~17.5

24.7~30.1

3.01.3

2.5

1.6

2.5

0.31.30.04 0.02

6.06.0 0.2

2.8

1.6

0.01

3.3

2.1

0.03

0.03

0.0

5.0

10.0

15.0

20.0

25.0

30.0

35.0

40.0

Nuclear Coal LNG Wind Geothermal Hydropower Small- &medium-hydraulic

Biomass Oil Solar(10kW more)

Solar(less than

10kW)

Gascogeneration

Oilcogeneration

Policyrelatedcost

Accidentriskcost

CO2

Fuel

Operation& manage

ment

Additionalsafety

measurescost

Capital

Legend

Yen/kWh

Nuclear Coal LNG Wind GeothermalHydropo

wer

Small &mediumhydraulic

Biomass OilSolar(10kWmore)

Solar(lessthan10kW)

Gascogeneration

Oilcogeneration

CapacityFactorOperation Year

7040years

7040years

7040years

2020years

8340years

4540years

6040years

8740years

301040years

1420years

1220years

7030years

4030years

GenerationCostYen/kWh

.()

Deduction of heat value(7.7~9.3)

Deduction of heat value(6.3~7.0)

() : Costs without policy related cost

Capacity factor in 2011 calculationCoal:80LNG:80Oil5010

The result of the sensitivity analysis of the change in fossil fuel price.

(Ref.)EvaluationofNuclearPowerGeneration(2)EconomicEfficiency

Source Extraction (preliminary translation) from documents released in the 7th Working Group on Verification of Power Generation, Long-term Energy Supply and Demand Outlook Subcommittee, Advisory Committee for Natural Resources and Energy, METI 7

Theimpactofthe10%changeofthefossilfuelpriceYenkWh

Coal

LNG

Oil

Sensitivityanalysisofthefossilfuelpricechange

AdditionalsafetymeasurescostdoublesDecommissioningcostdoublesDecommissioningandcompensationcostincreasesby1TYenReprocessing and MOXFuel fabricationcostdoubles

Sensitivityanalysis

Projected costs of generating electricity (2014 model plant)

The cost of nuclear power generation is estimated with consideration not only of costs directly related to power generation, but also of :

Accidentriskcost(0.3Yen/kWh)The accident response cost of the Fukushima Daiichi accident is estimated 12.2Tr. Yen which can becorrected to 9.1Tr. Yen in consideration of power output of model plant etc.

The lower limit of the estimated value is presented because the damage compensation cost mayincrease in the future.

Policyrelatedcost(1.3Yen/kWh)The cost includes a 345BYen (2014FY) subsidy for power plant siting 130BYen/year and R&D cost forMonju 130BYen/year etc.

Costofadditionalsafetymeasures(0.6Yen/kWh)Add60.1BYenwhichistheestimatedcostforadditionalsafetymeasuresfornewregulation

Nuclearfuelcyclecost(1.5Yen/kWh)Halfofthespentfuelisstoredfor20yearsandreprocessedafterthat,andtheotherhalf isstoredfor45yearsandreprocessedafterthat.

Thecostcontainsfrontend costs(0.9Yen),backend costs(total:0.6Yen,reprocessing:0.5Yen,highlevelradioactivewaste0.04Yen.

Capitalcost 3.1Yen

Operatingandmaintenancecost

3.3Yen

Nuclearfuelcyclecost 1.5Yen

Policyrelatedcost 1.3Yen

Accidentriskcost 0.3Yen

Additionalsafetymeasurescost 0.6Yen

Nuclear power generation cost 10.1Yen/kWh

Capitalcost(3.1Yen/kWh)Buildingcost (0.37MYen/kW440BYen/plant),fixedassettax (1.4),decommissioningcost (71.6BYen)

Public cost

Pow

er generation cost

Capacity: 1.2GWOperating rate: 70 Discount rate: 3Operating period of plant: 40 years

Operatingandmaintenancecost(3.3Yen/kWh)Employmentcost(2.05BYen/year),repaircost(2.2),overheadcost (8.44BYen/year)

8

(Ref.)EvaluationofNuclearPowerGeneration

Source extracted (preliminary translation) from documents released in the 8th Long-term Energy Supply and Demand Outlook Subcommittee, Advisory Committee for Natural Resources and Energy, METI

future costs including decommissioning, nuclear fuel cycle, and permanent disposal of radioactive waste,

accident risk costs including nuclear damage compensation and decontamination, policy related costs including subsidies for power plant siting and R&D expenses for Monju etc.

0200400600800

1,0001,2001,4001,600

1990 2005 2012 2050

Nuclearpowerisawellestablishedlargescalelowcarbonpowersourcewhichdoent emitGHGduringoperation.Itisstillinternationallyconsideredasoneoftheimportantsolutionstotheglobalwarming,thoughitassumessomechallenges.

Incaseofsubstitutingacoalfiredplant(1GW,capacityfactor80)byanuclearpowerplant,0.4%ofCO2emission(5.8Mt)outofthetotalemissionofJapancouldbereduced.i.e.,4%reductionby10plants)

IntergovernmentalPanelonClimateChangeIPCC WGIIIreport(April2014)Nuclear energy is a mature lowGHG emission source of baseload power,butitsshareofglobalelectricitygenerationhasbeendeclining(since1993).Nuclearenergycouldmakeanincreasingcontributiontolowcarbonenergysupply,butavarietyofbarriersandrisksexist.

LifecycleCO2emissionforeachpowersource

CO2 emissionfrom utilities

Energy orientedCO2 emission

Energy orientedGHG except CO2emission

.2 . .

Bt-CO2GHG emission andlongtermtarget

Target after 2020 to be presented prior enough to COP21 (2015)

36.227.621.82010

1.6

1.41.2

1.0

0.8

0.6

0.40.2

SourceCRIEPI

Wind power

Solar power

Geothermal energy

Hydropower

Nuclear power

Coal-fired

Coal-fired

LNG-fired (combined)

LNG-fired (steam)

Fuel (direct) Others (indirect)FY1990 FY2005 FY2012 FY2050

emission

TowardthenextconferenceofCOP21,JapansreductiontargetonGHGemissionhasbeendecidedtobe26%,bythegovernmenttakingJapansenergypolicyanddiscussiononthebestenergymixintoconsideration.

(Ref.)EvaluationofNuclearPowerGeneration(3)environmentaladaptability

9

GreenhouseGasEmission

WorstrecordofCO2 emission* inFY2013,duetoNPPsshutdownreplacedbyadditional thermalpowergeneration*Originatedfromenergysupply

InternationallycomparabletargetofGreenhousegasreduction

GoalforEnvironment

A METIs advisorycommittee on energy best mix set up 3 goals corresponding to 3E onthe premise to secure safety, in order to compile an outlook of 2030 demand & supplystructure of energy in Japan.

SecureS afetyPrem

ise

ElectricityCost

Lowerthecostlessthanpresentlevel

GoalforEconomicefficiencySignificantriseinelectricityprice

since 3.11approx.30%upforindustryapprox.20%upforhousehold

SurchargeforFIT;1.3trillionyeninFY2014

SelfSufficiencyRate

Only6%atpresentApprox.25%,exceedingthelevelbefore3.11approx.20%

GoalforEnergysecurity

10

Source Extraction (preliminary translation) from documents in the 8th Long-term Energy Supply & Demand OutlookSubcommittee, Advisory Committee for Natural Resources & Energy, METI

(Ref.)EnergyBestMix TargetLevelonthePremiseofConsideringtheEnergyBestMix

2030Solar 74.9 7.0%Wind 18.2 1.7%

Geothermal 10.211.3 1.01.1%Hydropower 93.998.1 8.89.2%Biomass 39.449.0 3.74.6%

Composition of electricity sources and electricity generationbillion kWh 2030

Oil 31.5 3%

Coal 281.0 26%

LNG 284.5 27%

Nuclear power 216.8231.7 2022%

Renewableenergy 236.6251.5 2224%

Total 1065.0 100%

2030

Renewable energy 22~24% (approx.)

LNG 27% (approx.)

Coal26% (approx.)

Oil 3% (approx.)

LNG 27%

Oil 12%

Coal 24%

Average in the last 10 years before 3.11

Nuclear power 27%

Renewable energy 11%

Nuclear power 20~22% (approx.)

All the numbers are approximatelySource extracted (preliminary translation) from documents released in the 8th Long-term Energy Supply and Demand Outlook

Subcommittee, Advisory Committee for Natural Resources and Energy, METI 11

Based on 3 goals presented in the previous page, the current draft is as follows (Nuclear power is 2022%). The draft is now under the public comment process, and will be officially announced thereafter.

(Ref.)EnergyBestMix OutlookofCompositionofElectricPowerSources

Efforts towards restoration and reconstruction of Fukushima is a starting point torebuild Japanese energy policies.

GOJs playing more proactive roles in the decommissioning of Fukushima DaiichiNPPs and the countermeasures for the contaminated water issue (CWI).

GOJs playing more proactive roles in proceeding compensation, decontaminationand operations of intermediate storage facilities.

Conducting necessary studies for the establishment of R&D center fordecommissioning and of industrial cluster for the fabrication/maintenance aroundthe Fukushima Daiichi site.

2. Efforts toward Restoration and Reconstruction of Fukushima Description in the Strategic Energy Plan of Japan

12

Number of evacuees from FukushimaAbout 157 thousand About 119thousandDecember 2012 Jan 2015

Number of evacuees from the evacuation zoneAbout 110 thousand About 73 thousandDecember 2012 Jan 2015

(Ref.)AssistanceofFukushimaevacueesfrombothaspectsofquickreturnandquicklaunchofnewlife

Measuresforliftingofevacuationordersandreturn

Expansionofassistanceforlaunchingnewlife

MeasuresforsafetyandremovinganxietiesReductionofradiationexposure/healthconsultation

AdditionalcompensationforreturnImprovingenvironmentforreturnbyusingSubsidyforAccelerating

FukushimaReconstructionDecontamination incollaborationwiththereconstructionandpolicy

measuresafterthedecontaminationwork

Materializationofliftingofevacuationordersthroughdialogueswithhostmunicipalitiesandlocalresidents

AdditionalcompensationnecessaryfornewlifeDevelopingreconstructioncentersinoroutoftheevacuationzoneConsideringhowtoimplementregionalconstructionand

decontaminationworkinlightoffutureperspectivesofdecontaminationbusiness,etc.

Materializationofmidandlongtermvisioninawideareathroughdialogueswithhostmunicipalitiesandresidents

Evacuation order areas of Fukushima Dai-ichi Nuclear Power Plant (as of October 2014)v

13

Perioduptothecompletionofdecommissioningmeasures(30to40yearsinthefuture)

Phase3EffortstostabilizetheNPP Phase1 Phase2

Perioduptothestartofthefuelremovalfromthespentfuelpool(within2years)

Period up to the start of the fuel debris removal (within 10 years)

FuelremovalfromSpentFuelPools

FueldebrisremovalfromUnit1 3

removal equipment

Installation of fuel debris

removal equipment

Dose reduction, Leakage identification &Stop leakage

Fuel debrisremoval

Present

Unit 1

Unit4Removalwascomplete

StepsforSpentFuelRemoval;RubbleRemoval&DoseReductionInstallingFuelHandlingMachineFuelRemoval

Unit2

Unit3

Preparingforrubbleremoval

Dosereductionisunderway

Rubbleremoval&dosereductionisunderway

ColdshutdownachievedAchievecoldshutdown Significantlyreduceradiationreleases

December2011 November2013 December2021 30to40yearsinthefuture

(Ref.)MidandLongTermRoadmaptowardstheDecommissioning

ThecurrentRoadmap wasrevisedinJune,2013.TheGovernmentofJapanisnowintheprocessoftherevision,takingaccountoftheStrategic

PlanwhichNDFisdeveloping.

14

Unit 1

Unit 2

Unit 3

Unit 4

Hydrogen explosion Core melt

No hydrogen explosion Core melt

Hydrogen explosion Core melt

Hydrogen explosion No core melt Fuel removal cover

Water

Water

615

566

392 Currently, toward thefuel removal from SPF,removal of rubbles isunderway.

The building cover isplaned to be dismantledaround April 2015, withsufficient measures toprevent the scattering ofradioactive materials.

On December 22,2014, all (1533) fuelremoval from Unit 4SPF was completed.

(Ref.)CurrentStatusofEachUnitatFukushimaDaiichiNPPs

15

3. Existing Light Water Reactors

On the premise that safety comes before everything else and that every possibleeffort is made to resolve the peoples concerns, judgment as to whether nuclearpower plants meet the new regulatory requirements will be left to the NuclearRegulation Authority (NRA)

In case that the NRA confirms the conformity of nuclear power plants with the newregulatory requirements ,which are of the most stringent level in the world, GOJwill follow NRAs judgment and will proceed with the restart of the nuclear powerplants.


16

PWRBWR

Tomari

Ohma

Onagawa

Fukushima Daini

Hamaoka

Tokai

Fukushima Daiichi

Kashiwazaki Kariwa

Sendai Ikata

Genkai

Shimane

Shika

Tsuruga

Takahama

Ohi

Mihama

Higashidori(Tokyo)

Higashidori(Tohoku)

ABWR

Reactor-type

Under NRA Review for basic design and concept (Total 25 Units

AgeCapacity

(Applied Date for NRA Review)

Not Start Operation

Permitted in Feb. 2015

Permitted in Sep. 2014

(Ref.) Nuclear Power Plants in Japan (As of June 16, 2015)

17

Decided to be permanent shutdown in April 2015 (Total 5 Units

**Based on the Basic Act on Disaster Control Measures and the Act on Special Measures concerning Nuclear Emergency Preparedness

Preparationandenhancementofthedisasterpreventionandevacuationplan

*Notrequiredbythenuclearreactorlaw

Safety Reviews and Inspections process of NRA

Local acceptance process* No legal requirements Localacceptanceprocess

Disaster prevention and evacuation plan *Not a legal prerequisites for restart

Date Reactor Applicant

Sep.102014

SendaiNPS,Unit1 and 2

Kyusyu ElectricPower

Feb.122015

Takahama NPS,Unit3and4

KansaiElectricPower

Permitted reactors

Review of basic design and concept (for permission of reactor

installment license change)

Review of detailed design (for approval of construction works plan)

Assessment of Operation management systems, etc. (for approval of operational

safety programs

(Ref.) Outline of processes for restart of NPPs

18

Date Reactor Applicant Date

Mar.182015

SendaiNPS,Unit1 Kyusyu

ElectricPower

May 272015May22

2015SendaiNPS,

Unit2

Approved reactors

2. Disaster prevention and evacuation plan Aregionaldisasterpreventionplan(includingevacuationplan)againstnucleardisastershouldbeformulatedbylocalauthoritiesbasedontheBasicActonDisasterControlMeasures.

Althoughformulationofregionaldisasterpreventionplanisnotalegalrequirementforrestart,theplanisimportanttoensuresafetyoflocalresidents.Thegovernmentsupportslocalauthoritiestomakeasufficientplan.

KyushuElectricPowersubmitteditsapplicationtomakechangestothereactorinstallmentlicenseofSendaiNPSUnit1and2inJuly2013.

NRAcompiledadraftevaluationreporton16th July2014whichadmitsthatSendaiNPPssatisfiesnewregulatoryrequirements.

Afterthepubliccommentprocess(until15th August)andreviewingofthesubmittedopinions,NRAgrantedapermission(changestothereactorinstallmentlicense)on10th

September2014forthebasicdesignandsafetyfeaturesofSendaiNPPs.Afterthat,NRAapprovedthedetaileddesignandconstructionofSendaiNPSUnit1and2on18thMarch2015and22thMay2015,respectively.Andthen,NRAapprovedtheoperationmanagementsystemsofSendaiNPSUnit1and2on27thMay2015.

SendaiNPSUnit1and2canberestartedaftercompletingpreserviceinspectionofoperationalsafetyprograms.

1. NRAs Safety Review Sendai NPP

18,600pagedocumentwasreviewed&62reviewmeetingswereheldfor110hours

3. Local Consent of the restart of Sendai NPPs BoththegovernorofKagoshimaprefectureandMayorofSatsumasendai City,hostingSendaiNPPs,approvedtherestartoftheNPPs,whichmeansthelocalconsentprocesswascompletedforthosetworeactors.

(Ref.)EffortstowardsrestartofSendaiNPPs

19

Nuclear industry as well as GOJ must shed the so-called safety myth, and pursue the worlds highest level of safety for operations through continuous and voluntary safety improvement.

The industrial circles, including nuclear operators, need to set up business schemes to persistently pursue safety and make efforts to foster safety culture that places top priority on the safety of nuclear facilities.

Each nuclear power operator, with a firm resolve that it will never let another nuclear accident to happen, should establish an appropriate risk management system and implement objective and quantitative risk assessments such as probabilistic risk assessment (PRA).


4. Reconstruction of Safety Culture

20

One of the lessons from the TEPCOs Fukushima nuclear accident is that preparation for unexpected situations was not sufficient.

GovernmentIndependency of the regulatory body was not sufficient

and there was a regulatory capture.Measures to prevent or deal with severe accidents were

not subject to regulation.The government had publicly reiterated that nuclear

facilities were safe. That led to a loss of opportunities for improvement of regulation.

Nuclear operatorsThey had publicly reiterated that nuclear facilities were

safe because they complied with regulatory requirements.An unanimous decision-making process among operators

on regulatory issues has discouraged them from voluntary safety improvements.

A study by TEPCO employees warning of a possible inundation of 15.7m was not taken seriously by its executives.

Nuclear vendors Considerations for their clients, operators, had prevented

them from proposing additional safety installations.

CountermeasuresNuclear Regulation Authority (NRA) independent of the other governmental bodies was established.

NRAs new regulation covers measures to prevent or deal with severe accidents.

Conformity to new regulatory requirements does not mean absolute safety.Dr. Tanaka, the Chairman of NRA

ChallengesNo common understanding of residual

risk with local communities and residents.

Dependence of operators on venders and an utility association on safety issues.

Lack of proper incentives for voluntary improvement of nuclear safety in the current regulatory scheme.

21

(Ref.) Lessons from TEPCOs Fukushima Nuclear Accident

22

(Ref.) Challenges of Nuclear Operators

Proper risk management should take root in each utility based on a firm commitment by top executives to nuclear risk information

Proper communication on residual risk with various stakeholders such as local residents near NPPs or general citizens should be established

Thorough site-specific risk assessments should be implemented

On-site operators who have experiences in owners engineering during construction, and are familiar with detail designs of NPPs and able to take appropriate actions in case of unexpected accidents should be properly trained.

A METIs Advisory Committee published the proposals on what the industrys initiative tovoluntarily improve safety should look like were on 30th of May 2014.

Proposals for Voluntary and Continuous Improvement of Nuclear Safety (May 30, 2014)Implementation of risk management under an appropriate risk governance frameworkActivities required to be implemented based on lessons learned from the accident at TEPCOs Fukushima

Daiichi NPS as the starting pointImplementation of exhaustive and comprehensive risk assessments including lowfrequency eventsReduction of residual risk through strengthening defense in depthIdentifying the accident sequences and cliff edges at each plant, focusing on external events such as earthquakes and

tsunamis, which are particular to Japans geographical conditions, and improving resilience including response to, andrecovery from unexpected incidents that are not properly addressed by the existing ordinary system

Reorganization of research for improving the safety of lightwater reactors that are commercially operated in Japan andreinforcement of research coordination among organizations at home and abroad

Attitudes especially required to steadily proceed with these activities and have them take rootCreation of an organizational culture with a critical mind and power of imagination concerning residual risksSwiftly introducing stateoftheart information and opinions from both home and abroad, and making Japans efforts known

overseas

Involvement of external stakeholders Improving human and intelligence bases across industry Sharing roadmaps to be constructed by each industrial actor based on the WGs proposals and pursuing for the overall optimization

through constantlymonitoring actions based on the roadmaps and continuously revising the roadmaps

(Ref.) Proposals for Voluntary and Continuous Improvement of Nuclear Safety

23

Established within the Central Research Institute of Electric Power Industry (CRIEPI) onOctober 1, 2014.

Utilizing PRA, this center is to perform R&D of safetyenhancing technologies which isbeyond merely fulfilling regulatory requirements and to examine and propose effectiveproblemsolving measures at individual plant, etc.

The authorities of nuclear safety with strong leadership experience were invited to serveas the NRRCs executives.

Head: Dr. George Apostolakis (A former member of the U.S. NRC) Executive Advisor : Dr. Richard A. Meserve (A former Chairman of the U.S. NRC)

(Ref.) Establishment of the Nuclear Risk Research Center (NRRC)

24

A METIs Advisory Committee overhauled how the efforts toward voluntary improvement ofnuclear safety have been conducted by each actor (utility, vendor, scientist, government) basedon the proposals in 2014, and published the proposals on further improvement of voluntaryefforts toward safety enhancements on the 27 of May 2015.

Proposals for further Improvements of Voluntary Efforts for Improvement of Nuclear Safety (May 27, 2015)

25

(Ref.) Proposals on Further Improvement of Voluntary Efforts to Safety Enhancements

Examples of good practices1. Shikoku Electric Power Co. has participated in the NRRCs research project on seismic level 2 PRA

using the Ikata NPS unit 3 as a model plant of the research.2. Kansai Electric Power Co. has worked on the development of human resources who are deeply

familiar with its plant design and installation in the case of accident.3. Tokyo Electric Power Co. has established a council headed by the nuclear divisions manager in

charge of a risk management and the council has been directly reporting to a executive committeeon risk management chaired by the president as necessary.

Major proposals on further improvement of voluntary efforts1. It is necessary for the electric utilities to utilize PRA for daily risk management including

operation and maintenance of nuclear plants.2. It is necessary for the electric utilities to implement appropriate risk communication with various

stakeholders presuming the possibility of a severe accident.3. It is desirable for the nuclear industry to voluntarily set a safety goal in light of accidents at sites

with multiple units such as the TEPCOs Fukushima Daiichi NPS.

5. Promotion of Strategic Development of Technologies and Human Resources

1. Maintaining and developing high-level nuclear technologies and human resources is imperative for smoothly decommissioning aged nuclear power plants, which are expected to increase in the future, as well as TEPCOs Fukushima Daiichi Nuclear Power Plants.

2. Because enhancing the nuclear safety in surrounding countries ensures the safety of Japan, maintaining and developing high-level nuclear technologies and human resources which enable Japan contribute to their safety enhancement is essential.

3. GOJ promotes the development of technologies that contribute to safety improvement of LWRs including countermeasures against severe accidents and enhance their reliability and efficiency in order to reduce risks in case of an accident.

4. Under international cooperation, GOJ also facilitates R&D of nuclear technologies that serves the safety improvement of nuclear use, such as high-temperature gas-cooled reactors which are expected to be utilized in various industries including hydrogen production and which has an inherent safety.


26

The draft of the Light Water Reactor Safety Technology and Human Resource Roadmap wascompiled on 27th of May 2015 through the interaction between a METI's advisory committeeand the Atomic Energy Society of Japan.

This roadmapwill be reviewed at least once a year.

(Ref.) Basic Policy for Formulation of Light Water Reactor Safety Technology and Human Resource Roadmap

Present solutions and the draft of the roadmap

Present issues from public perspectiveWorking Group on Voluntary Improvement of Safety,

Technology and Human Resource

Atomic Energy Society of Japan

Share the process of compilation and revision in an intelligible manner

A structure of formulating the roadmap

Nuclear Energy Subcommittee

Confirm Share

Public / Local municipalityRequests compilation of the roadmap compatible with basic principles of the Strategic Energy Plan

2020 2030

Issue A

2050

To steadily implementefforts forwardautonomous safetyimprovement based onscientific disciplines andknowledge and toconstruct a framework inwhich operatorscontinuously maintain anddevelop technologies andhuman resources for LWRsafety while incorporatinginternational knowledge.

To establish an internationalcollaborative scheme basedon public confidence in theframework and efforts towardautonomous safetyimprovement and to reduceresidual risks by implementingsteady investments neededfor ensuring safety so thatnuclear power is usedappropriately as an importantbase-load power source in theenergy supply-demandstructure.

To contribute to theinternational community inboth technologies and humanresources by furtherpursuing the reduction of thedisadvantages and theenhancement of theadvantages regarding the useof nuclear power so thatnuclear power plays a stableroles in providing sustainableenergy supply and takingcountermeasures againstglobal warming.

Conceptual image of the roadmap

An objective at each milestones

Milestones

Evaluation elements

Get priorities of issues by utilizing appropriate evaluation elements

Issues

Issue B

27Sourcehttp://www.meti.go.jp/committee/sougouenergy/denkijigyou/jishutekianzensei/009_haifu.html, Working Group on Voluntary Improvement of Safety, Technology and Human Resource, Nuclear Energy Subcommittee, Advisory Committee for Natural Resources and Energy (The 9th Meeting)

6. Establishment of Appropriate Business Environment under the More Competitive Market

Nuclear operators are also required to 1) maintain high-level nuclear technologies and human resources,2) smoothly go through decommissioning work, which will increase in the future3) quickly take the best safety measures in response to regulations reinforced

after the TEPCOs Fukushima nuclear accident and 4) contribute to global warming countermeasures and stable electricity supply

utilizing base-load power sources.

Therefore, GOJ will explore an appropriate business environment in which nuclear power operators can meet the above challenges even under the more competitive environment promoted by the electricity system reform, learning lessons from the overseas examples.


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1st Reform:passedinExtraordinaryDietin20131) EstablishmentoftheOrganizationforCrossregional

CoordinationofTransmissionOperators(OCCTO)2) Actionprogramsfor2nd and3rd Reforms etc.

2nd Reform:PassedinOrdinaryDietin20141) Fullretailcompetition2) Revisionofapplicableandregulationsassociated

withtheabolishmentofGeneralElectricityUtilitysystem

3rd Reform:OrdinaryDietin20151) Legalunbundlingof

transmission/distributionsectors

2) CodeofConduct

1 streform

CabinetDecisiononthePolicyonElectricitySystem

Reform

Abolishment of retail tariff

Legal unbundling of transmission

/distribution sector

2015 (approx.):Transition to new regulatory organizations

1st Step2015

2nd Step2016

3rd Step2018-2020

2 ndreform3 rdreform

The1stBill

(1st bill)2013

Establishment of the Organization for Cross-regional Coordination of Transmission Operators

(OCCTO)

Full retail competition

Periodoftransitionalarrangementforretailtariff

(2nd bill)2014

(3rd bill)2015

The2ndBill

(Ref.) Roadmap for Electricity Market Reform in Japan

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Historically,utilitieshaverunnuclearbusinessbasedontheguaranteedrecoveryoftheirinvestmentsthroughregionalmonopolyandregulatedprices (rateofreturnregulation).Bythiselectricitymarketreform,regionalmonopolyandregulatedpricesaretobeterminated.

Utilitieswillhavetorunnuclearbusinessesinanenvironmentwheretherecoveryoftheirinvestmentswillnotbeguaranteed.

VerificationforElectricityMarketReform Inadvancingmarketreform,GOJhastoverifytheenforcementstatusofeachbill,theimplementationstatusof

theStrategicEnergyPlanandtheelectricitysupplydemandsituationatfollowingopportunities:beforefullretailcompetition,beforelegalunbundlingoftransmission/distributionsector,andaftertheenforcementoflegalunbundling.

Dependingontheoutcomeofeachverification,GOJhastotakenecessarymeasures.

7. Contribution to Peaceful Use of Nuclear Power and Nuclear Non-proliferation in the World

GOJ will promote dialogues with the international community on such occasions as meetings of the IAEA, where information will be promptly and accurately disseminated. As nuclear power generation is expected to be increasingly used in emerging nations, including Asian nations, it is a responsibility that Japan must fulfill and the world expects it tofulfill to make proactive contributions to improvement of nuclear safety, peaceful use of nuclear power, nuclear non-proliferation and nuclear security in the world, by sharing the experiences and lessons learnt from the TEPCO's Fukushima nuclear accident. It is imperative for Japan to proactively contribute to formulating international standards of nuclear safety, such as the IAEA standards. Japan will contribute to improvement of nuclear safety in the world by continuing to share nuclear technologies with our enhanced safety and improved safety culture with other countries based on the experiences and lessons learnt from the accident, while confirming that a proper consideration is given to nuclear facilities' safety secured mainly by hosting countries in reference to the Convention on Nuclear Safety and the IAEA safety standards when public finance is offered on providing nuclear power technologies to overseas, including exports of nuclear power plants.

By making use of its experience as a non-nuclear armed country, Japan will also actively contribute to strengthen nuclear nonproliferation through reinforcement of the IAEA safeguards and stringent export control and international nuclear security through actively participating global initiative such as nuclear security summits. In particular, in the non-proliferation field, it is important to intensify the efforts toward the nuclear non-proliferation by promoting international collaboration in enhancing proliferation resistance of nuclear fuel, and R&D to strengthen technology of nuclear forensics, detection and safeguards, etc. Japan will go through these efforts in cooperation with the countries such as the U.S. and France. GOJ will also set up an integrated implementing body to support development of human resources, institutional infrastructure and others for countries that will newly introduce nuclear power, through cooperation with international organizations such as the IAEA.


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(i)Apermanentshutdownwillalsostymieresponsibleinternationalnucleardevelopment,asdevelopingcountrieswillcontinuetobuildnuclearreactors. Chinacouldeventuallyemergeasasignificantinternationalvendor. AsChinaplanstojoinRussia,SouthKorea,andFranceinthemajorleaguesofglobaldevelopmentinciviliannuclearpower,Japancannotaffordtofallbehindiftheworldistobenefitfromefficient,reliable,andsafereactorsandnuclearservices.(ii)JapanandtheUnitedStateshavecommonpoliticalandcommercialinterestsinpromotingsafeandreliableciviliannuclearpowerdomesticallyandinternationally.(iii)Safe,clean,responsiblydevelopedandutilizednuclearpowerconstitutesanessentialelementinJapanscomprehensivesecurity. Inthisregard,U.S.Japancooperationonnuclearresearchanddevelopmentisessential.

The3rdArmitageNyeReportissuedbyCSISonAugust15,2012(Excerpt)

Japaniscommittedtosecuringnonproliferationaswellasnuclearsafetyandsecurityintheworld byprovidingproventechnologieswithUSallies,givengrowinginfluenceofRussiaandChinaintheworldnuclearmarket.

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(Ref.) Expectations for Japans Nuclear Technology after Fukushima

1. OECDmemberstatesareobligedtocompeteagainstRussianwiththerestraintsofpublicfinancingstipulatedintheNuclearSectorUnderstanding(NSU)ofOECDExportCreditArrangementintheworldnuclearmarket.

2. RussiaandChina,whicharenonOECDmemberstates,haveanadvantageinpromotingnuclearexportintheworldmarketwithbettertermsandconditionsofpublicfinancing.

Russias advantage in the field of public financing

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(Ref.) Current Situations in the World Nuclear Market

Case1:Hungary

Hungarian Government was to start a bidding process for their NPP new construction. In January 2014, the Hungarian Prime Minister officially and suddenly announced that

Russia was selected as Hungary's exclusive partner for their NPP construction during his official visit to Russia.

The Hungarian Prime Ministers office web site says that Russian loan for the EUR 10-12 billion investment would be provided for a 30-year term which covers 80% of the total cost.

Russias advantage in the field of public financing

33


Case2:Finland Fennovoima (FV), a NPP operator in Finland requested bidders for its reactor project to

procure 100% debt finance. FV identified Toshiba as a preferred bidder. Toshiba proposed a finance arrangement

from Japanese ECAs (Export Credit Agencies) based on the NSU terms and conditions (which did not cover full debt portion).

After receiving Toshibas proposal, FV decided to start negotiation with Rosatom. FV entered into a plant-supply agreement with Rosatom and terminated negotiation

with Toshiba. A FV executive noted that finance was the most important factor as Rosatom confirmed full debt finance arrangement for the project.

Case3:CzechRepublic The Operational Vice President of Rosatom Overseas noted that We are ready to

provide anything from a small part of the financing to 100 percent. It is up to the Czech Republic to decide how much they want.

CEZ, a NPP operator requested U.S. and Japan that they should provide 100% debt finance as well. US EXIM and JBIC offered a matching with the Russian finance.

China is promoting installation of Generation-III reactor technology and own domestic production. State Nuclear Power Technology Corp (SNPTC) is now deploying the first four units of Westinghouse

AP1000 (Generation-III plants) in China. SNPTC has also been developing CAP1400, which has larger-scale based on AP1000 as well as includes more indigenous components at Huaneng'sShidaowan site.

China National Nuclear Corporation (CNNC) and China General Nuclear Power Group (CGN) are working together to develop domestic reactor Hualong One by integrating the technologies of CNNCs AP1000 and CGNs ACPR1000+. The first Hualong One will be deployed for Fuqing 5&6(CNNC).

China is strongly promoting nuclear export globally toward such countries as Turkey, Sudan and Pakistan. Especially in Turkey, according to media sources, SNPTC committed to invest in AP1000 construction project at the third site following Akkuyu and Sinop. In return for the investment, SNPTC will gain a wider coverage of manufacturing of AP1000 components.

1.ChinasEffortsforselfsufficientinreactordesignandconstructionCAP1400,Hualong One

China and UK signed a MOU in October 2013. The MOU stipulates the strategic framework for collaboration on investment, technology, construction and expertise in the field of civilian use of nuclear energy.

In the same month, EDF officially announced that EDF and Chinese companies(CGN and CNNC) agreed to jointly invest in Hinkley Point C nuclear power station. The total share of Chinas equity is expected to be 30-40%.

2.Chinasentrytothe UKnuclearmarket

3.Chinasactivitiesintheworldnuclearmarket

Expansion of Chinas presence in the world nuclear market

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Japan's Current Nuclear Energy Policy

Documents

Transcript of Japan's Current Nuclear Energy Policy