- The Washington Times - Thursday, May 5, 2011

TOKYO | The relationship between Japan's government and its private electrical power industry is like a free-spinning revolving door, with bureaucrats and business executives trading places at the expense of nuclear safety.

The disaster at a nuclear plant owned by the Tokyo Electric Power Co. that sent the country in an emotional meltdown illustrates the point.

The government’s regulatory policy amounted to this:

Trust Tepco and do not verify.

A review of Japan’s approach to nuclear plant safety shows how closely intertwined relationships between government regulators and industry have allowed a culture of complacency to prevail.

Perhaps no one illustrates the movement between business and government and back again better than Tokio Kano. He joined Tepco in 1957 and became a leader in the utility’s nuclear unit in 1989. By 1998, he entered Japan’s parliament as a candidate for a seat given to the nation’s largest business lobbying group.

In parliament, Mr. Kano helped rewrite national policy that enshrined nuclear power as the energy of Japan’s future.

After two six-year terms, he returned to Tepco in July as an adviser. The utility declined to make him available for an interview.

Regulators, meanwhile, simply did not see it as their role to pick apart Tepco’s raw data and computer modeling to judge for themselves whether the plant was sufficiently protected from a tsunami, like the massive wave that struck after the March 11 earthquake and flooded the cooling pumps at the utility’s Dai-ichi nuclear plant in Fukushima in northeastern Japan.

This kind of willful ignorance was not unique within a sympathetic bureaucracy at the Ministry of Economy, Trade and Industry. The agency has multiple functions - some that easily can be viewed as having conflicting goals.

The ministry is charged with touting the benefits of nuclear energy, selling Japanese technology to other countries and regulating domestic nuclear plant safety.

Until January, it was led by a former engineer in the nuclear-plant-design section at Hitachi Ltd.

The ministry’s promoter-regulator conflict makes Japan unusual among nuclear-power-producing countries.

The United States split those two functions nearly 40 years ago with the closure of its Atomic Energy Commission. Now the U.S. Department of Energy promotes nuclear power, while the U.S. Nuclear Regulatory Commission handles safety.

In Japan, where government has long supported major industries, the power utilities that run nuclear plants have enjoyed direct access to regulators.

Both regulator and regulated share an interest in promoting nuclear power as an energy source free of greenhouse gases that reduces the island nation’s heavy reliance on imported fossil fuels.

Regulator and regulated also share people in a free-spinning revolving door.

In a practice known in Japanese as amakudari, which translates as “descent from heaven,” top government officials nearing the end of their careers land plum jobs within the industries they regulated, giving Japan’s utilities intimate familiarity with their overseers.

Meanwhile, top industry officials are appointed to positions on policy-shaping government advisory panels.

Toru Ishida, for example, became an adviser at Tepco in January, just four months after retiring as the head of the Agency for Natural Resources and Energy, the organization that promotes the nuclear industry.

After becoming a post-tsunami symbol for amakudari, he resigned.

Mr. Ishida was not the first senior energy agency official to depart for the utility. Susumu Shirakawa held a senior agency post before he joined the Tepco board and eventually became a vice president.

The Associated Press examined the business and institutional ties of 95 people currently at three main nuclear regulatory bodies, either as bureaucrats or members of policy-setting advisory panels.

Overall, 26 of them have been affiliated either with the industry or groups that promote nuclear power, typically with government funding. Twenty-four people held prior positions at those three regulatory bodies.

Industry is heavily involved elsewhere in Japan's government. At the Japan Atomic Energy Commission, which backs research and promotes Japan’s nuclear industry, one of the five commissioners is an adviser to Tepco, while another is a former executive at the Central Research Institute of Electric Power Industry, an industry group that includes former utilities employees.

“Tepco participates when its expertise is required on various panels related to nuclear issues,” said Linda Gunter, a company spokeswoman until April 20, when she also resigned.

A spokesman for the Central Research Institute said regulatory panels need insiders because nuclear energy is a specialized field.

“It’s the question of balance,” spokesman Kiyoshi Sato said. “Hearing from a different viewpoint can be refreshing.”

The aftermath of the magnitude 9 earthquake and tsunami may finally persuade a nation long enchanted with nuclear power that intimate ties between regulator and regulated can create significant potential conflicts of interest.

The government’s chief spokesman, Yukio Edano, promised recently to curb the ability of bureaucrats to depart for jobs at utilities.

“Regardless of whether this is illegal or not, this should not be allowed,” he told reporters.

As Fukushima Dai-ichi deteriorated into a disaster as serious as Chernobyl, the main spokesman at Japan’s Nuclear and Industrial Safety Agency maintained that the regulatory structure was fine. But after a month, NISA spokesman Hidehiko Nishiyama wavered.

“Our thinking up to now was that safety will be maintained by the same group that both promotes and regulates the industry,” Nishiyama said.

Under Japan’s nuclear regulatory system, NISA carries out plant inspections once every 13 months and checks on safety measures every quarter. There are no surprise inspections.

After Tepco was found to be misrepresenting inspection videotape and other records in 2002, the maximum that companies could be fined for a false report was raised to $1.2 million. No utility has received that penalty, and Tepco has never paid any fines related to falsifying records.

What Tepco did do in 2002 was clean house by firing its leadership. But three top executives who departed the utility in disgrace found their way back. Currently advising Tepco are Nobuya Minami, Hiroshi Araki and Toshiaki Enomoto - the former president, chairman and vice president, who resigned amid the scandal.

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