US Insurance Fund Can't Cover Major Nuclear Disaster

The United States nuclear insurance fund would be unable to cover losses caused by an epic disaster similar to the one that hit the Fukushima nuclear reactor in Japan in March, according to a report in the Newark Star-Ledger.

 

The insurance fund, created under the Price-Anderson Act of 1957, only has $12.6 billion in reserves — far less than the $74 billion to $260 billion the Japanese government estimates it will cost to clean up the destruction and rectify the economic losses associated with the Fukushima disaster caused by a giant tsunami and earthquake.

 

There is plenty of disagreement over the safety of U.S. nuclear plants and whether they can withstand severe earthquakes or other disasters, according to the Star-Ledger.

 

But there is apparently little disagreement over massive costs that would be involved in a cleanup along the lines of the ongoing one in Japan.

 

“If you have an accident or something like Fukushima, then Price-Anderson can’t handle those kinds of losses,” Wharton School public policy professor Howard Kunreuther told the newspaper.

 

“The Japan power plant failure is far worse than almost anything we’ve ever had. Maybe Chernobyl, from the point of view of people affected, but certainly not in the case of economic damage,” added Kunreuther, who co-wrote a paper several years ago on the potential costs to the U.S. government of catastrophic nuclear disaster.

 

Plants in the United States aren’t threatened by tsunamis, but they can be damaged by earthquakes or other natural occurrences, and possibly terrorist attacks.

 

The Star-Ledger, quoting an Associated Press report from last month, noted that while the risk of an earthquake-related accident at a U.S. nuclear facility may be small, it is at least 24 times far more likely to occur than previously thought.

 

The newspaper also noted that the Nuclear Regulatory Commission (NRC) recommended last week that all nuclear power plant operators immediately re-evaluate earthquake and flooding hazards at their facilities.

 

An NRC official quoted in the article pointed out that there was “a one in 1,000 years chance” of a large tsunami overwhelming the Fukushima plant sea wall.