By Mari Saito
TOKYO Dec 14 Nearly two years after a massive
earthquake and tsunami caused meltdowns at the Fukushima nuclear
plant, Japan is failing to keep a pledge to tap global expertise
to decommission its crippled reactors, executives at nuclear
contractors from the United States and Europe say.
The result, they warn, is that a process expected to take
more than 30 years and cost at least $15 billion could take
longer and cost more as contracts are channelled through
domestic heavyweights such as nuclear reactor makers Toshiba
Corp and Hitachi Ltd, and general contractors
such as Taisei Corp.
A review of bidding records by Reuters shows companies from
outside Japan have failed to win any of the 21 contracts awarded
this year to develop technologies crucial for the unprecedented
job of scrapping the four damaged reactors at Fukushima.
"There appears to be a desire to treat this as a science
project and reinvent the wheel," Jeffrey Merrifield, senior vice
president of U.S. nuclear engineering firm Shaw Group Inc's
power division told Reuters.
Contracts awarded since January represent only the initial
work at Fukushima. But a half-dozen executives at companies with
nuclear industry experience raised questions about the Japanese
government's and Tepco's oversight of the process.
Some executives worry that being shut out now risks their
ability to tap a growth market, since Japan could scrap dozens
of reactors over the coming decades. Most asked not be named for
fear of jeopardizing their ability to win future work in Japan.
Takuya Hattori, president of the Japan Atomic Industrial
Forum, a group representing the nuclear industry in Japan, said
the government has not been responsive to complaints about the
bidding process. "They are shutting that criticism out
incredibly deftly," said Hattori, a 36-year veteran of Tokyo
Electric Power Co Inc, the operator of the Fukushima
A 9.0 earthquake on March 11 triggered a 15-metre tsunami
that smashed into the 40-year-old seaside Fukushima Daiichi
nuclear plant, setting off a series of events that caused its
reactors to start melting down.
Hydrogen explosions scattered debris across the complex and
sent up a plume of radioactive steam that forced the evacuation
of more than 80,000 residents near the plant about 240 km (150
miles) northeast of Tokyo.
The repeated failures that dogged the government and Tepco
in the months after the disaster undercut confidence in their
response to the disaster and dismayed outside experts, given
corporate Japan's reputation for relentless organisation.
After that, Japan promised to accept more outside
The Fukushima plant was declared to be in "cold shutdown" a
year ago, a stable phase when water used to cool fuel rods
remains below its boiling point. That marked the start of a
decommissioning process that could take 40 years.
Under a roadmap drafted by Tepco, radioactive fuel rods will
be removed from Reactor No. 4 starting next November. After
that, melted fuel inside three other reactors damaged by
meltdowns and hydrogen explosions would be extracted. The work
is projected to take more than a decade.
A government oversight panel has estimated it will cost $15
billion to decommission the reactors, not counting for the costs
of disposing of radioactive waste.
But large uncertainties hang over the overall cost of the
disaster. Tepco recently said compensation for evacuated
residents and decontamination of areas outside the boundary of
the Fukushima plant could double from previous estimates to
almost $125 billion.
Louisiana-based Shaw Group worked on clean-up projects after
the Three Mile Island and Chernobyl accidents and in
decommissioning eight U.S. commercial reactors.
"There seems to be a real desire to rely on Japanese
contractors to do this work," Merrifield said. "You can try and
do it all yourself, which takes a lot more time without benefit
of prior experience, making a lot of mistakes along the way."
But an executive with a Japanese nuclear firm said that
given the long-term nature of the clean-up project, it makes
sense to go with firms at home.
"Foreign firms simply sell their product without providing
back-up services or maintenance. We can't sign a contract with a
company that we can't get in touch with immediately and one that
will rush to deal with any problems right away," the executive
TRANSPARENCY 'NO. 1 PRIORITY'
The majority of contracts for Fukushima have been awarded
directly by Tepco, which outsources decontamination and
debris-clearing to general contractors. Decontamination
contracts outside of the plant site are handled by Japan's
environment ministry and local governments.
Japan's Ministry of Economy, Trade and Industry has so far
allocated about $11 million to Toshiba Corp, Mitsubishi
Heavy Industries and Hitachi GE Nuclear to fund
technology development for the year to March. That includes a
project to develop sensing robots that can enter highly radiated
areas to pinpoint the site of the meltdown.
"This is a project we are pursuing with taxpayer funds, so
we believe it is our No. 1 priority to be transparent," said
Kentaro Funaki, director of the ministry's nuclear accident
Funaki said METI was pushing to double the bidding period
to four weeks and pointed to a recent contract offered by
Japanese radiation management firm Atox Co Ltd specifically to
foreign contractors as a sign of increased openness.
METI and the heavy manufacturers held workshops in March and
April to gather information on foreign technology that could be
used at Fukushima.
British Amec PLC, Areva, Westinghouse and the Idaho
National Laboratory pitched technologies that can be used to
remotely inspect and repair damaged reactors.
Japan's three major nuclear companies say they post notices
of bids on their websites.
Hitachi GE Nuclear posts bid notices on its website in both
English and Japanese. The company said it was working as quickly
as possible to restore and rebuild Fukushima and the short
bidding periods were not designed to shut out foreign firms.
Toshiba said it posted contracts on its website, but deletes
them after a vendor is selected. Contracts are awarded by an
outside panel of experts with the highest score given to
technology and cost. Toshiba declined to comment on the lack of
foreign involvement in research contracts.
Mitsubishi Heavy recently posted a notice on its website
that it would soon invite bids for equipment to investigate the
pressure containment vessels at the Fukushima Daiichi plant.
"THE DOORS ARE OPEN"
Japan's government and Tepco have emphasised the importance
of international involvement in the Fukushima clean-up. In an
interview with Reuters in October, Tepco president Naomi Hirose
said the utility was seeking expertise from all over the world.
To be sure, U.S. and European companies have had some
California-based Kurion and French nuclear giant Areva
designed the first water purification systems at
Fukushima. That was followed by equipment supplied by Toshiba
and Shaw that doubled Tepco's ability to process contaminated
water. The latest water purification equipment made by Toshiba
and Utah-based Energy Solutions was installed earlier
"I would tell you that if the roles were reversed, Americans
would want American firms leading the way," said John Raymont,
president and CEO of Kurion. "For companies that have the
special know-how that is transferable, the doors are open."
Shaw's Merrifield said his company was no longer working on
any projects in Fukushima. Shaw sold its stake in nuclear plant
company Westinghouse Electric Co to Toshiba for $1.6 billion in
Many of Japan's 50 nuclear plants are expected to be
decommissioned in the coming years. The Japanese government has
pledged to eliminate nuclear power from the energy mix by the
2030s and popular opinion is turning against the industry.
"At the end of the day, it's not about just Fukushima," said
one executive at an overseas engineering company, who asked not
to be named because of the company's business interests in
Japan. "You get in now, establish a relationship and build trust
and there is a lot of work that you can do."