As the region proliferates its nuclear power footprint, what must risk manager do to prepare?

Few topics garner such a visceral initial reaction that nuclear power. The prospect of a nuclear power plant opening fills us with images from Chernobyl and Fukushima – high-profile disasters which have sullied nuclear power’s reputation.

However, nuclear power plants have a carbon footprint comparable to renewable energy sources such as solar farms and wind farms, making them considerably greener than fossil fuel operations. Nuclear power’s more recent safety record has also done much to allay fears of its usage.

As such, nuclear power continues to expand. In Asia, there are about 140 operable nuclear power reactors with 35 under construction, plans for an additional 40 to 50, while many more are proposed. Asia’s future nuclear plans outstrip any other continent in the world.

Regardless of any given view on the utility of nuclear power, one aspect is certain – risk managers in Asia must be prepared for their organisations to operate in regions and countries with nuclear power.

So, just how safe is nuclear power? And which risk management provisions need to be in place if a plant operates near a business’ operations. 

The ‘risk trade-off’

When considering the growth of nuclear power in the region, it is important to acknowledge that Asia-Pacific is the most disaster-prone region in the world. Nearly 45 percent of the world’s natural disasters take place in the region, and more than 75 percent of those affected by natural disasters globally live in the region.

When the Fukushima Daiichi Nuclear Power Plant disaster in Japan hit in March 2011, it was caused by damage from a magnitude 9.0 earthquake and tsunami.

Mariko Nishizawa, director and founder of the Litera Japan Corporation is a risk policy and communications expert, and a member for both the Science Council of Japan and the International Atomic Energy Agency (IAEA).

In the wake of the Fukushima Daiichi Nuclear Power Station accident in 2011, Nishizawa served as an advisor for the Iitate Village in the Fukushima Prefecture. 

“After the Fukushima accident, I was utterly shocked,” says Nishizawa. “Working as an advisor after the disaster, I have seen the actual sufferings of the people. Many were forced out of their homes and made to stay in sheltering houses during severe winters. Many of the elderly died.”

Despite Nishizawa’s first-hand experience of the suffering from a nuclear disaster, she states that international conditions around global warming and sky-rocketing energy prices highlights the value of nuclear.

“In terms of CO2 emission, nuclear power is much cleaner, with virtually zero emissions. It is remarkable how much energy even a small nuclear reactor can produce. However, during operations, there is a big risk, because nuclear energy generation itself is a risk. This is a risk trade-off though,” says Nishizawa.

Such risk trade-off include consideration around how to dispose of nuclear waste. Countries such as Finland and Sweden have decided to bury their nuclear waste. While continuing this practice is a consideration for future generations, so too is leaving them with a hotter planet.

Safety improvements

While nuclear technology has been around for a very long time, to date there has only been three major incidents – the Three Mile Island accident in 1979, the Chernobyl disaster in 1986, and the Fukushima disaster in 2011.

“The effect of the Chernobyl accident is by far the most catastrophic compared to the other two,” says Nur Azha Putra, a certified risk manager and research fellow at the Energy Studies Institute, National University of Singapore (NUS).

“But since then, much has been done by the global nuclear energy community to strengthen international cooperation and the global regime on nuclear safety and security. 

“Good governance of nuclear energy continues to be pivotal in ensuring that nuclear power is safe for civilian application. Yes, there are certain risks involved, but these risks can be managed and mitigated to a large extent through good governance and compliance with the international regime and norms on nuclear safety and security,” says Putra.

“Nuclear power is the safest form of energy in use in the world today,” claims Henry Preston, external communication manager of World Nuclear Association.

“Globally, air pollution from fossil fuels kills around seven million people a year. Nuclear power has avoided about 74Gt of CO2 emissions, by displacing fossil fuels over the past 50 years – the equivalent of nearly two years’ worth of total global energy-related emissions. Therefore, nuclear can be said to have saved lives.”

APAC expansion

As the concerns which spawned from the Fukushima disaster wane, Asia is again becoming more receptive to nuclear energy, as evidenced by the power plant expansion plans in the region. The region’s major economies – China, India and Japan – all have sizable nuclear expansion plans, making the region the leader for new nuclear power plants. So what are the risk management implications of this nuclear expansion across Asia?

“There will always be risks. Good governance includes recognising and addressing these risks ahead of time,” says Putra. “This is particularly true for newcomer states that have plans to implement a civilian nuclear energy programme for the first time, and new build states that are planning to build or add new nuclear power installations.

“From a safety and security perspective, it is imperative that the state – if it has not already done so – become a contracting party to the relevant international treaties on nuclear safety, security, liability, and safeguards,” he says.

Asia is the main region in the world where electricity generating capacity, and specifically nuclear power, are growing significantly.

“The greatest growth in nuclear generation is expected in China. Asia has consistently delivered new nuclear projects on time and on budget, therefore this area of world is well placed to handle such its expansion,” says Preston.

Asia’s expansion would leave it closer aligned with the rest of the world, such as the US which already has 92 reactors, while France – with 56 reactors – currently has more plants than Asian superpower China with 54.

“The US and France have been running several nuclear reactors for several years and has no major disasters,” says Nishizawa, who suggests the strict risk management approaches of these nations can show the way as Asia’s nuclear footprint expands.

Risk management implications

The message for risk managers, from all organisation types, is that nuclear power will inevitability be expanding across Asia.

While the chances that a nuclear power plant being built near their organisation are small – and the probability of a major accident even slimmer – the risk management planning implications remain vital. A nuclear incident has far-reaching implications on communities and supply chains.

Risk managers looking to mitigate against nuclear expansion, a first consideration is evaluating major incidents at previous nuclear plants to comprehend the lessons learned.

“Risk managers should research the Three Mile Island incident in the US or Fukushima in Japan. See what can be learned and that can be the starting point for their own risk contingency plan,” says Nishizawa.

Putra says there are several strategies that risk managers can opt for, starting with developing a business continuity plan (BCP) which takes into consideration how the company could continue to operate in the event of a nuclear power plant accident, especially if the situation requires prolonged emergency response and treatment.

“Additionally, risk managers should form a working relationship with the operator of the nuclear power plant, the regulatory authority, and the designated incident manager in the case of an emergency response,” says Putra.

“A good measure of an effective working relationship with the nuclear power plant operator is that the company is kept informed should any nuclear incidents lead to atmospheric dispersion of radioactive pollutants regardless of their severity.

“Even if the atmospheric dispersion is relatively low, the reporting of such incidents creates trust and confidence, mitigates panic, and prevents misinformation and disinformation from external parties.” 

When dealing with the regulator, the risk manager should be kept informed, updated, and even contribute towards the emergency preparedness and response (EPR) framework for nuclear and radiological incidents and emergencies, especially in the areas of crisis communication.

As fears around the safety of nuclear power have eased in recent years, its Asian expansion is now in full flow. Risk managers in the region must be alive to this reality, weaving preparedness into their emerging risk horizons.