Utilities may get caps on liability in time of serious nuke accidents

In the event of a serious nuclear accident, the government is considering capping the liability of electric power companies and placing the burden beyond that on the public in the form of taxes or higher electricity rates.

The Cabinet Office plans to submit the plan to an experts’ panel along with the current program, which does not contain such caps, sources said.

The experts’ panel will start to discuss both from Oct. 3 and issue the results of its discussions within this fiscal year, which ends in March 2017. After that, the science ministry will consider revising the related laws, they added.

In the accident at the Fukushima No. 1 nuclear power plant in March 2011, the compensation paid by the operator, Tokyo Electric Power Co., has reached 6 trillion yen (about $60 billion).

The amount is much higher than the 120 billion yen in total that can be currently covered by a private insurance program and governmental expenditures.

Because of that liability, electric power companies are asking the government to place a cap on the compensation they must pay at the time of serious nuclear accidents.

According to the sources, the setting of an upper limit would require utilities to shoulder a considerably higher amount of compensation.

In the event that the actual compensation exceeds that amount, the utility would also have to pay the portion beyond the limit if the nuclear accident is completely attributable to their actions.

If the nuclear accident is mainly caused by natural disasters, however, the portion beyond the upper limit would be chiefly covered by governmental compensation and only a part of that portion would fall on the utilities, depending on the extent of their culpability.

The government’s compensation would be eventually shouldered by taxpayers.

The push to set a cap is apparently being led by the belief of electric power companies that now is a good time to ask the public to share part of the burden with the prevailing mood in the current administration to restart nuclear reactors.

However, some experts say that if an upper limit is adopted, electric power companies will become less concerned about safety.

There is a possibility that those companies will place less importance on investing in safety measures,” said Tadashi Otsuka, professor of law at Waseda University, an expert on environmental laws and compensation systems.

http://www.asahi.com/ajw/articles/AJ201610020022.html

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