Sustaining Government Support In Japan

Sustaining Government Support In Japan

Masaomi KOYAMADeputy Director

Nuclear Energy Policy Planning DivisionMinistry of Economy, Trade and Industry, Japan

Technical Meeting / Workshop on Evaluation Methodology for Nuclear Power Infrastructure Development

10 - 12 December 2008, Vienna, Austria

Preparing for assuming commitments & obligations

Infr

astr

uct

ure

dev

elop

men

t p

rogr

am1st

. NP

P P

roje

ct

Commissioning

Operation / decommissioning

Nuclear power option included within the national energy strategy

10 – 15 years

PHASE 2

PHASE 3

PHASE 1

MILESTONE 1Ready to make a knowledgeable commitment to a nuclear programme

MILESTONE 2Ready to invite bidsfor the first NPP

MILESTONE 3Ready to commission and operate the first NPP

Feasibility study Bidding process

Pre project Project decision making Construction

Considerations before a decision to launch a nuclear power programme is taken

Preparatory work for the construction of a NPP after a policy decision has been taken

Activities to implement a first NPP

Maintenance and continuous infrastructure improvement

INFRASTRUCTURE DEVELOPMENT PROGRAMME

Is Government Commitment/Involvement needed all the time ?

Long-Term Government Commitment ?

TM/WS on Evaluation Methodology for Nuclear Power Infrastructure Development, 10-12 December 2008

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GOVERNMENT COMMITMENT IN EARLY STAGE


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Government Commitment in early stage (1)

Budget 1954 First national budget for nuclear power development allocated (approved by the Diet)

Legislation 1955 Atomic Energy Basic Act was legislated <Basic Law>Atomic Energy Basic Act is the basic law for the peaceful use of nuclear energy. This act restricts nuclear energy to peaceful purposes only. The 3 principles, democratic, independent and public has not changed for over 50 years.

1957 Act for Regulation of Nuclear Source Material, Nuclear Fuel Material and Reactors was legislated <Law of Safety Regulation>

And other related laws and government orders were established before the first application for the establishment of NPP.

Brief history of the development of NPP in early stage;1954 National Nuclear Power Programme started1961 Construction (Concrete placing) of the first NPP started1965 The first NPP connected to the grid (Commercial operation started in 1966)


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Formation of Governmental Organisation 1955 Establishment of the Atomic Energy Commission (Act for the Establishment of Atomic Energy Commission) 1955 Nuclear development department was established in the Cabinet Office (Amendment Act for the Establishment of Cabinet Office)

Human Resource DevelopmentFiscal Year 1954 Governmental Project on Human Resource Development started Studying Abroad Programme, Human Resource Development Programme at domestic nuclear related organisations.

Nuclear Energy Development Basic Plan1956 Atomic Energy Commission established the first “Long-Term Plan for Research, Development and Utilization of Nuclear Energy”

After the first Long-Term plan, AEC published the plan around every 5 years.



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Feasibility Studies for Siting of NPP1963 Nationwide research for the feasibility of siting started (Boring for geological survey, Climate Survey) – This result was used by electricity utilities for siting NPPs.

Aid for Nationalisation of Reactor Technologies<Example>- Subsidies by Government- Government loan programme by Japan Development Bank- Preferential tax treatment for new technology



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SUSTAINABLE COMMITMENT FOR NPP DEVELOPMENT


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Government of Japan has acted for the development of NPPs continuously since the NPP development programme started. Following event are some examples of Governmental Actions;

1973 Introduced Public Consultation procedure in nuclear development1973 Established an Information Disclosure Office1974 Legislation Act on the Development of Areas Adjacent to Electric Power Generating Facilities 1978 Established the Nuclear Safety Commission1981-85 National project on Advanced Light Water Reactor (ABWR, APWR) 2001 Established the Nuclear and Industrial Safety Agency

Examples of Past Governmental Actions


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PRESENT GOVERNMENT SUPPORT FOR NPP

DEVELOPMENT


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Prime Minister’s Addresses/Cabinet Resolutions

Statement by Prime Minister<Example>Prime minister’s Speech (April 2008, JAIF Annual Conference, Tokyo)-it is critical for us to strengthen the utilization of nuclear energy as a major source of power

Cabinet Resolution<Example> Framework for Nuclear Energy Policy (October 2005) Economic and Fiscal Reform (June 2008) Action Plan for Building Low Carbon Society (July 2008)


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Nuclear Energy Policy = Governmental Commitment

Basic Targets under the Framework for Nuclear Energy Policy (October, 2005)

1) Keeping the share of nuclear power generation at least 30-40% beyond 2030.2) Steady promotion of the nuclear fuel cycle.3) Introduction of the first commercial FBR in 2050


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Policy Packages under the “Nuclear Energy National Plan” (August 2006)

1. Ensuring investments in the construction and replacement of nuclear plants 2. Appropriate use of existing NPPs with assuring safety3. Deploying strategy for acquiring natural resources4. Steady promotion of the nuclear fuel cycle and strategic enhancement of related industries.5. Early introduction of commercial FBR and its fuel cycle6. Secure sufficient levels of technologies and human resources 7. Support international activities of Japan’s nuclear industry8. Active participation in efforts to create an international framework for expanding the use of nuclear energy and ensuring non-proliferation9. Building trust between government and local communities through detailed communication10. Reinforcing the measures for radioactive waste disposal

Implementation of the Framework for Nuclear Energy Policy


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- Reduction and dispersion of investment risks - Reduction and leveling-out of the financial burden of initial investments

and decommissioning- Promotion of broad-area operations- Clear demonstration of the benefits of nuclear power generation

Specific Steps Reduction of backend risks: a provisional reserve system for

the 2nd reprocessing plant 　 Reserve system for leveling out the future financial burden of costs

related to spent fuels other than those handled by the Rokkasho plant.

Provisional system until a detailed plan for reprocessing is fixed.

Leveling-Out of Initial Investment Cost: a pre-operation reserve system for the construction of new nuclear plants

Reserve system for leveling-out the cost of capital depreciation of initial investment

Example of Specific Measures of Nuclear Energy National Plan (1)

Investments for Nuclear Power Plants


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Specific Steps A feasibility study for a next-generation LWR was started under

the fiscal 2006 budget as the first national nuclear project in 20 years. Assistance programmes for training of field engineers on

maintenance work and for transfer of skills to future generations were started under the fiscal 2006 budget.

The “nuclear energy human resources programme” was established under the fiscal 2007 budget.

- Launch of a joint public-private project for the development of a next-generation LWR

- Creation of a nuclear industry with the scale and competitiveness suited to the global market

- Support for training of field engineers and transfer of skills to future generations

- Support for training of university researchers in the nuclear sector


Maintenance of Technology and Human Resources


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Basic Policy As a leader among non-nuclear armed countries engaged in the peaceful use of nuclear energy, Japan will continue to ensure strict export control, follow safeguard arrangements and implement measures to safeguard nuclear materials. Japan will thus serve as a model country to ensure nuclear non-proliferation and the peaceful use of nuclear energy simultaneously.

Specific Steps The Japanese government announces a proposal that

supplements a nuclear fuel supply assurance scheme proposed by six countries in Sept. 2006. (The “IAEA nuclear fuel supply registration system.”)

The Japanese government expressed support for the GNEP initiative immediately after its announcement in Feb. 2006.


Active Involvement in the Global Framework


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　 Because it is important to secure the stable power supply with low price for our stable daily life and economical development, it was required to promote the power stations with scheduled plan. However, the situation for locating the power stations including nuclear power plants was difficult in rapid growth of power demand in 1970s since the regional coordination had been delayed.

　 To deal with above situation, three Acts for the development power sources (‘Tax Act for Promotion of Power Sources Development’, ‘Act on Special Accounts for Electric Power Development Acceleration Measures’ and ‘Act on the Development of Areas Adjacent to Electric Power Generating Facilities’ ) were enacted in 1974 to promote the power resource development, which new tax system was set to impose based on power capacity that electricity company sells and new special account/budget for promotion of power resource development.

【 Background 】

【 Measures 】

Establishment of the Special Account for Promotion of Power Sources DevelopmentEstablishment of the Special Account for Promotion of Power Sources Development

Support for Local Community Development (1)There are some support programmes for the development local communities where power plants sited. This shows a example of the programmes.


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For the purpose of establishing operating power station smoothly, Three Power related Acts; ‘Tax Act for Promotion of Power Sources Development’, ‘Act on Special Accounts for Electric Power Development Acceleration Measures’ and ‘Act on the Development of Areas Adjacent to Electric Power Generating Facilities ’ were legislated in 1974. These Acts support the development local community where power stations sited.

Tax law Law related to special account Law for located area

Consumer

Electriccompany

Government（ Special account for energy ）

Measure for Use

Special subsidy to power utility located area including nuclear

Subsidy for project promotion in located area

etc.

Tax for power resource promotion 　（ Pay 37.5 sen per 1kWh of selling electricity ） For use ： 18.5sen For location ： 19.0sen (* 100 sen = 1 yen)

Fee

Funds for located area

Account for power resource promotionG

eneral account

Measure for Location

Subsidy for measure to power station located area

※One of the laws, Act on Special Accounts for Electric Power Development Acceleration Measures, was abrogated on April 1st 2007, and related works have been taken to Act for Special Account.

Support for Local Community Development (2)


Tax for promotion of

electric power

development

Special A

ccount for E

nergy (Prom

ote for siting pow

er stations )

Locatedprefectures

Related to NPP operation 　(For long-term development)

Related to nuclear location/operation (For Early Stage of siting, Development Power station and other purpose ）

For the development of regions with nuclear power plants, subsidies are granted to 1) Prefectures and municipalities where nuclear power plants are sited,2) Within calculated limits based on energy output, the amount of power generated, and population, etc.,3) For projects in the hardware and software sectors for which these local communities apply, based on their own initiative.

Neighboring municipalities

Sited municipalities

General account

Subsidy for Measures to Power Station Located AreasSubsidy for Measures to Power Station Located Areas



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Public Facilities ProjectFor equip, maintain and operate the public facilities/service including road, water, sport, education/culture.

Public Facilities ProjectFor equip, maintain and operate the public facilities/service including road, water, sport, education/culture.

Local Economy Revitalization projectTo publicity local tourism information, human resource development, to support local industries, etc.

Local Economy Revitalization projectTo publicity local tourism information, human resource development, to support local industries, etc.

Public Information ProjectOrganise the events such as inspections, training, lecture, discussion and make poster/brochure to promote the better understanding for power generation utilities

Public Information ProjectOrganise the events such as inspections, training, lecture, discussion and make poster/brochure to promote the better understanding for power generation utilities

Warm Discharged Warter Related ProjectSeafood-raising, training, research of fisheries, effective use of discharged water etc.

Warm Discharged Warter Related ProjectSeafood-raising, training, research of fisheries, effective use of discharged water etc.

Welfare projectTo give subsidy to the projects for improvement in welfare include equip/maintain the facilities for medical and social welfare, help home help business.

Welfare projectTo give subsidy to the projects for improvement in welfare include equip/maintain the facilities for medical and social welfare, help home help business.

Activation of Industries ProjectPromotion of locating factories such as development of industrial park, development of facilities which promote local industries

Activation of Industries ProjectPromotion of locating factories such as development of industrial park, development of facilities which promote local industries

Benefit projectTo give benefit to take measure for discount of electric fee for households, factories, etc.

（ cf. ）　 In FY2008, each household in Kariwazaki, Niigata received the benefit, total amount about 29,000 yen （ about 25% discount)

Benefit projectTo give benefit to take measure for discount of electric fee for households, factories, etc.

（ cf. ）　 In FY2008, each household in Kariwazaki, Niigata received the benefit, total amount about 29,000 yen （ about 25% discount)

Extensive projects are available to promote the located area effectively.

Example of Projects for the Subsidy for Measure to Power Station Located AreasExample of Projects for the Subsidy for Measure to Power Station Located Areas



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Establish the Council for NPP development with related member of Cabinet leading with prime minister as chairman.

After deliberation at the council, prime minister decides the area or its promotion plan. Based on the plan, the government implements the support measure like increasing the

assistant rate with safety consideration in the area.

It is important that nuclear power generation make steady progress since it is superior to provide stable supply and to measure global warming.

However, the situation over nuclear power plant location has became difficult after criticality accident at JCO’s uranium reconversion plant in 1999.

For stable energy supply in future, it is necessary to take special measures to equip life environment, industry infrastructure totally and widely around the area of nuclear power plants sited since nuclear power is essential for our country’s electricity supply and need to promote it.

From these perspective, this law was approved in 2000 and enacted in FY2001 to promote these area.

Process

Special Measures Act Designed to Promote Local Economies where Nuclear Power Stations are Located

Special Measures Act Designed to Promote Local Economies where Nuclear Power Stations are Located

Council for NPP development

（ Chairman ） Prime Minister（ Member ） Related cabinet members


（ Chairman ） Prime Minister（ Member ） Related cabinet members

Prefecture/Muni.Government/Council

Prefectural governor hears the opinion from Mayer of related municipalities and make plan for the location.

Prefectural governor hears the opinion from Mayer of related municipalities and make plan for the location.

By Prime Minister

Designate the areas for NPP sited

By Prime Minister

Designate the areas for NPP sited



Prefectural governor hears the opinion from Mayer of related city and make plan for promotion of the area.

Prefectural governor hears the opinion from Mayer of related city and make plan for promotion of the area.

＜ Support measure ＞Target ： Road, Harbor, Port, Fire facility, compulsory education facilityIncreasing the assistant rate (e.g. 5.5/10) and other support

＜ Support measure ＞Target ： Road, Harbor, Port, Fire facility, compulsory education facilityIncreasing the assistant rate (e.g. 5.5/10) and other support

By Prime Minister

Decision of promotion plan

By Prime Minister

Decision of promotion plan

Apply deliberation

Submit

deliberation

Implement the promotion plan at

each area

Implement the promotion plan at

each area

Scheme

Support



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Public Acceptance Activities are crucial thing to expand nuclear powerPublic Acceptance Activities are crucial thing to expand nuclear power

Build trust between government and local communities - Create a visible presence in communities where nuclear facilities are

sited, dealing sincerely with their particular concerns in meetings at all levels.

- Stand on a common position of information recipients are very important.

- Enhance direct dialog with local residents (in small face-to-face meetings, etc.).

- Ultimately the responsible persons at the national level should make clear the government’s thinking and policy.

Concrete Measures- Information and opinion exchange between central government and

local residents which lived near nuclear facilities sited to understand accurately about peaceful use of nuclear energy

- Holding experience-based exhibit, open seminars and workshops- Sending experts to various kind of events to provide accurate

information about nuclear energy

Public Information Activities by Government


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Preparing for assuming commitments & obligations

Infr

astr

uct

ure

dev

elop

men

t p

rogr

am1st

. NP

P P

roje

ct

Commissioning

Operation / decommissioning

Nuclear power option included within the national energy strategy

10 – 15 years

PHASE 2

PHASE 3

PHASE 1

MILESTONE 1Ready to make a knowledgeable commitment to a nuclear programme

MILESTONE 2Ready to invite bidsfor the first NPP

MILESTONE 3Ready to commission and operate the first NPP

Feasibility study Bidding process

Pre project Project decision making Construction

Considerations before a decision to launch a nuclear power programme is taken

Preparatory work for the construction of a NPP after a policy decision has been taken

Activities to implement a first NPP

Maintenance and continuous infrastructure improvement

INFRASTRUCTURE DEVELOPMENT PROGRAMME

Government Commitment/Involvement is needed all the time

Long-Term Government Commitment


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Thank You For Your Attention !

Sustaining Government Support In Japan

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