Making Victims Whole: Compensation of Nuclear Incident Victims in Japan and the United States

Transcription

1 Making Victims Whole: Compensation of Nuclear Incident Victims in Japan and the United States Ken Lerner and Edward Tanzman Argonne National Laboratory REP National Conference Minneapolis, MN April 24, 2012

2 Compensating Victims of a Nuclear Power Plant Accident Overview this presentation will review: Compensation to people affected by the Fukushima Daiichi accident. Compensation in the United States the Price- Anderson Act. Disaster Assistance in the United States Stafford Act. Other models for implementing disaster claims (Cerro Grande and Deepwater Horizon) How well prepared are we? Is this function well integrated into REP? 2

3 Fukushima Daiichi accident: protective action timeline March 11: Evacuated residents within 3 kilometers (1.9 miles) and shelter-in-place for residents within 10 kilometers (6.2 miles). March 12: Evacuated residents within 20 kilometers (12.4 miles). About 77,000 people evacuated. March 15: Began sheltering residents from 20 to 30 kilometers ( miles). About 62,000 people sheltered. April 11: Planned Evacuation Areas (also sometimes referred to as deliberate evacuation area ) and Evacuation Prepared Area established in the areas beyond 20 kilometers (12.4 miles). April 14: Sheltering-in-place recommendation lifted for kilometer ( miles) zone. Many residents in this area voluntarily evacuate. April 21: Restricted area within 20 kilometers (12.4 miles) established to allow temporary access and exclusion area of 3 kilometers (1.9 miles) established for members of the public. 3

4 Fukushima Daiichi: Protective Action Areas Source: IAEA Fukushima Daiichi Status Report, 23 February

5 Human Impact About 80,000 evacuees. About 10,000 businesses affected including farms, fishing, and other businesses located within the affected area. Some accounts give the total number of people affected as 1.7 million. 5

6 Human Impact Several fatalities were associated with evacuation of sick and elderly from hospitals and senior care centers. 6

7 Compensation Cost Estimates About $6 billion (mostly provided by the government, but channeled through TEPCO) already paid for evacuation costs, lost income, living expenses, and mental suffering. As of March 29, 2012, the company has requested another $10 billion from the government to cover compensation costs. Permanent settlements for damage are still upcoming: Negotiations have just started on evaluating homes, farmland, fishing rights, and businesses that were damaged or rendered worthless. -- Yuka Hayashi, WSJ April 3, Estimated future costs are $55 billion over the next 2 years. 7

8 Compensation System in Japan The key statute for nuclear accident compensation in Japan is the Act on Compensation for Nuclear Damage. It says: Where nuclear damage is caused as a result of reactor operation etc. during such operation, the nuclear operator who is engaged in the reactor operation etc. on this occasion shall be liable for the damage, except in the case where the damage is caused by a grave natural disaster of an exceptional character or by an insurrection. 8

9 Compensation System in Japan The key statute for nuclear accident compensation in Japan is the Act on Compensation for Nuclear Damage. It says: Where nuclear damage is caused as a result of reactor operation etc. during such operation, the nuclear operator who is engaged in the reactor operation etc. on this occasion shall be liable for the damage, except in the case where the damage is caused by a grave natural disaster of an exceptional character or by an insurrection. 9

10 Compensation System in Japan Japanese nuclear operators must maintain 120 billion yen (about $1.5 billion) in financial security. TEPCO meets requirement through an insurance policy from the Japan Atomic Energy Insurance Pool (JAEIP). The JAEIP policy excludes earthquake and tsunami damage. The law authorizes Japan s federal government to provide assistance if liability will exceed the financial security amount. The Diet (Japanese national legislature) recognized early on that this would be needed. Diet created Nuclear Damage Compensation Facilitation Corporation, funded by the government and by contributions from nuclear facility operators - $7 billion approved in November

11 Compensation System in Japan 11

12 Compensation System in Japan 12

13 Compensation Process First Mailing April 2011: TEPCO begins provisional payments. Dispute Reconciliation Committee for Nuclear Damage Compensation established. September 2011: first packages to evacuees sent out to cover expenses from the date of the accident through August 31 (about 6 months). About 60,000 claim application packages were sent out. The packages included: Three forms to fill out, one of which was 56 pages long. A 156-page instruction booklet. Receipts required for expenses. Required waiver of challenge to compensation. The claims packages were not well received. 13

14 Compensation Process Second Round In December 2011: (for expenses Sept. Nov.) Claim form simplified to 4 pages. Waiver requirement dropped. 100,000 yen per month (about $1300) for mental suffering. By December 14, 2011: 98.5 billion yen ($1.2 billion) had been paid to approximately 160,000 individuals and households. About 32 billion yen ($400 million) was paid to agricultural and fishery associations, and 8.3 billion yen ($100 million) to 7,300 small and medium businesses. 14

15 Compensation Process Recent Developments Expected Annual Dose Over 5 REM zones where residency is prohibited for an extended period 2-5 REM "zones with restricted residency. Compensation Full value of home plus 6 million yen (about $73,000) (equivalent to 5 yrs. of monthly payments) Continued monthly payments or 2.4 million yen (about $29,000) (equivalent to 2 yrs. of monthly payments) Less than 2 REM "zones being prepared for residents' return. Voluntary Evacuees km zone Continue monthly payments Continue monthly payments through August 2012 only 15

16 Compensation Process Staffing 3,300 TEPCO employees (8% of its payroll) 9,800 contract workers 16

17 Compensation Process in the United States Price-Anderson Act (PAA) First enacted in Updated and amended several times since, most recently in the Energy Policy Act of 2005 (extended the term of the Act for another 20 years). Scope includes power reactors, test and research reactors, Department of Energy nuclear and radiological facilities, and transportation of nuclear fuel to and from a covered facility. Requires financial protection in the amount of liability insurance available from private sources. 17

18 Compensation Process in the United States - PAA Licensees have satisfied the requirement by purchasing insurance from American Nuclear Insurers (ANI), a joint underwriting association formed specifically for this purpose. Covers any legal liability arising out of or resulting from a nuclear incident or precautionary evacuation (including all reasonable additional costs incurred by a State, or a political subdivision of a State, in the course of responding to a nuclear incident or a precautionary evacuation). 18

19 Compensation Process in the United States PAA Sets up 2-tier system: First Tier: $375 million policy carried by each reactor unit. Second Tier: Each unit required to kick in up to $117 million retrospective premium if damages exceed primary coverage. Total: $12.6 billion 19

20 Compensation Process in the United States PAA Experience at TMI, 1979: Accident began March 28, Much less serious than Fukushima: only one unit involved, partial melting of fuel. Release of radioactive noble gasses and some radioiodine. Doses downwind estimated to be no more than 100 mrem to any one person, average 8 mrem to those downwind within 10 miles. Governor recommended evacuation of pregnant women and pre-school-age children within 5 miles. Large voluntary evacuation estimated at over 100,000 people. Insurance representatives arrived the next day. An office was open by March 31 st and began paying living expenses to evacuees. 20

21 Compensation Process in the United States PAA Experience at TMI, 1979 cont d: By April 2nd, funds had been advanced to 2400 people. Total of about $1.2 million in evacuation claims was paid to 3170 claimants. Over $92,000 in lost wage claims paid to 636 individuals. To settle litigation, $20 million put into economic-recovery fund and $5 million into public health fund. Litigation continued for over 20 years; total payout by ANI included $42 million in settlements and $28 million in litigation expenses. 21

22 Compensation Process in the United States PAA ANI Planning and Preparation according to ANI: ANI has an Emergency Response and Planning Department to be prepared for a nuclear accident. ANI retains a claims contractor with the resources and expertise necessary to reimburse evacuees in the event of a covered nuclear loss. Anticipates that internet and telephone claims intake would be available within 24 hours of an accident and that claims centers would be operational within hours. Claims documentation is streamlined and designed by experienced professionals from the contractor. Claims information would be published through all available media including social media. 22

23 Disaster Assistance in the United States Stafford Act The Stafford Act authorizes financial and other forms of assistance to individual households, businesses, and state and local governments affected by a disaster. Activated by presidentially-declared major disasters and emergencies. Used frequently for natural disasters such as floods, hurricanes, tornadoes, winter storms, earthquakes and wildfires, where there is widespread physical damage to homes, businesses and community infrastructure. Intended to set community people and community on their feet, not for total compensation. 23

24 Stafford Act for Nuclear Plant Emergency? NRC RCM-96, Sec. P: An accident at a nuclear power plant does not fit the definition of a Major Disaster under the Stafford Act. FEMA criteria for declaration include whether it is best handled under another program: We also consider programs of other Federal agencies because at times their programs of assistance might more appropriately meet the needs created by the disaster. There may be a coincident natural disaster e.g., earthquake, flood. There could be a declaration with only certain programs activated to fill in the gaps e.g., lost tax revenues to local government. 24

25 Stafford Act for Nuclear Plant Emergency? 25

26 Other Options and Models for Compensation Cerro Grande Fire May 4, 2000: National Park Service prescribed burn escaped containment, ultimately burning 48,000 acres and over 200 residential structures in New Mexico. Stafford Act declaration and response but did not provide complete compensation. Cerro Grande Fire Assistance Act (CGFAA) was passed, setting policy and directing implementation by FEMA. Claims centers were operational by August. 138 staff were processing claims as of January 2001; about $600 million was paid altogether. This system was essentially created from scratch and moved quickly since the federal government was responsible for the event. 26

27 Other Options and Models for Compensation Deepwater Horizon April 20, 2010: Explosion and fire on drilling rig kills 11 crewmen and injure 17. Four to five million barrels of oil leak into Gulf of Mexico. Containment and cleanup response by USCG. British Petroleum (BP) set up $20 billion escrow fund for compensating victims. Sets up Gulf Coast Claims Center. As of March 22nd, 2012, over one million claims had been filed by 576,094 claimants, including 454,351 individuals and 121,743 businesses. Over six billion dollars had been paid to 221,748 claimants. The process was controversial and a court ruling in March 2012 turned over management of the claims center to a courtappointed master. 27

28 Why this is important: How well prepared are we? Any nuclear power plant emergency, even if only a precautionary evacuation, would lead to claims. Resolution of claims would be very visible would affect the public s perception of how well the situation is being handled. Resolution of claims is also substantively important to personal and community recovery. Recently federal doctrine has placed a greater emphasis on planning and preparation for recovery: (National Disaster Recovery Framework) The speed and success of recovery can be greatly enhanced by establishment of the process and protocols prior to a disaster for coordinated post-disaster recovery planning and implementation. All stakeholders should be involved to ensure a coordinated and comprehensive planning process, and develop relationships that increase post-disaster collaboration and unified decisionmaking. 28

29 How well prepared are we? Compensation receives relatively little attention in REP: One of the 16 regulatory planning standards touches on recovery: Development of general recovery and reentry plans NUREG-0654/FEMA REP-1, Rev. 1, addresses recovery: Each organization, as appropriate, shall develop general plans and procedures for reentry and recovery and describe the means by which decisions to relax protective measures (e.g., allow reentry into an evacuated area) are reached. This process should consider both existing and potential conditions. Neither of these mentions compensation, nor does the REP Manual. The fact that compensation is carried out by a different organization under different authority probably accounts for the scarcity of attention. 29

30 How well prepared are we? Measures to consider: Review whether the coverage provided by the PAA is adequate, given the estimated costs associated with Fukushima Daiichi. Review the relationship between the PAA and the Stafford Act; consider policy on declaration of disaster after a nuclear power plant accident. Review preparedness and coordination regarding compensation. Are state, local, and federal plans integrated with ANI s plan consistently with FEMA recovery guidance? Are there points of interaction that should be considered? How should an integrated compensation function be planned and exercised? Is there a need for additional authority to carry out the above planning and coordination? 30

31 Compensating Victims of a Nuclear Power Plant Accident Questions? The submitted manuscript has been created by UChicago Argonne, LLC, Operator of Argonne National Laboratory ( Argonne ). Argonne, a U.S. Department of Energy Office of Science laboratory, is operated under Contract No. DE-AC02-06CH The U.S. Government retains for itself, and others acting on its behalf, a paid-up nonexclusive, irrevocable worldwide license in said article to reproduce, prepare derivative works, distribute copies to the public, and perform publicly and display publicly, by or on behalf of the Government. 31