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REFLECTIONS ON THE EU-IRAN HIGH-LEVEL SEMINAR ON INTERNATIONAL NUCLEAR COOPERATION, 26-27 NOVEMBER 2018

We have previously commented on the Iran “nuclear deal”, more correctly known as the Joint Comprehensive Plan of Action (JCPOA), and the potential consequences of the Trump Administration’s withdrawal from it some six months ago.  

JCPOA

We noted there that Iran had “shown off” its capability to enrich uranium to worrying quantities, pushing the boundaries of the agreement in a manner designed not only as a retaliatory statement against Israel and the US, but also the EU if it did not live up to its side of the bargain. The EU, along with China and Russia, remains a supporter of the deal.

That threat came a step closer this week with a statement by Ali Akbar Salehi, Vice President and head of the Atomic Energy Organisation of Iran, who stated that Iran may resume enriching uranium to 20 per cent, well above the level needed for civil nuclear power plants. In an interview with Reuters, Salehi mentioned that Iran is failing to see the economic benefits of the 2015 deal, adding:

If we cannot sell our oil and we don’t enjoy financial transactions, then I don’t think keeping the deal will benefit us anymore.”

Sanctions

Clearly, US sanctions imposed after their withdrawal from the agreement are having an effect and making it difficult for Iran to trade, even though the EU has announced its intention to create a Special Purpose Vehicle (SPV) to “facilitate payments related to Iran’s exports (including oil) and imports, which will assist and reassure economic operators pursuing legitimate business with Iran”.

In the US context, it is worth noting that the International Atomic Energy Agency (IAEA) maintains that Iran is keeping its side of the agreement. In a statement to the IAEA’s Board of Governors on 22nd November, Director General Yamano stated: “Iran is implementing its nuclear-related commitments under the Joint Comprehensive Plan of Action (JCPOA). It is essential that Iran continues to fully implement those commitments.”

EU-Iran Seminar

Ali Akbar Salehi’s statement was made ahead of the third EU-Iran High-level Seminar on International Nuclear Cooperation, held in Brussels on Monday and Tuesday of this week with the aim of building confidence in the exclusively peaceful nature of Iran’s nuclear programme. In the margins of the seminar, Vice President Salehi met with the EU’s High Representative for Foreign Affairs and Security Policy/Vice-President of the European Commission, Federica Mogherini.

Salehi and Mogherini re-affirmed their commitment to the continued full and effective implementation of the JCPOA, took stock of recent developments and expressed their determination to preserve the nuclear agreement as a matter of respecting international agreements and a key pillar for the European and regional security. During their meeting, Federica Mogherini also reiterated the EU position on issues of concern, such as Iran’s role in the region.

Future Activities

The seminar also identified a number of future joint activities related to the nuclear governance framework, as well as research and training relating to nuclear safety and radiation protection.

These activities will include:

  • the organisation of seminars on nuclear law and on reporting under the Joint Convention,
  • participation in key European nuclear stakeholder conferences
  • sharing of experience and methodology for performing nuclear stress-tests
  • enhanced collaboration in the field of R&D
  • a further package of safety related projects financed under the Instrument for Nuclear Safety Co-operation
  • organisation of a stakeholders’ conference to leverage international support for the establishment of the Nuclear Safety Centre.

Participants also agreed to continue to implement the agreed roadmap on R&D co-operation, including a joint project on radioactivity measurement capabilities.

The seminar reconfirmed the existing understanding that international nuclear co‑operation, and nuclear governance, are important elements that should be developed in parallel in order to optimise benefits for all sides.

The EU and Iran expressed satisfaction at progress achieved so far in the areas of nuclear co-operation and governance, and agreed to hold a follow-up high-level seminar in 2019. However, the success of that may depend on the success of the SPV.

About the Author

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

Previous Articles

11th June 2018 Article about Iranian Uranium Enrichment

6th December 2016 Article about business in Iran, further to the lifting of sanctions

13th October 2016 Article about Dollar transactions with Iran

26th July 2016 Article about Iran’s quest for a credit rating

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FURTHER REFLECTIONS ON THE INTERNATIONAL NUCLEAR LAW ASSOCIATION GATHERING IN ABU DHABI

The reports from the International Nuclear Law Association (INLA) gathering in Abu Dhabi, from my colleague at Prospect Group William Wilson, have made for interesting reading. At the INLA conference there was a whole session on nuclear liability and insurance which covered interesting and pertinent topics, but some of the other papers also caught my eye.

Nuclear Damage Compensation

Professor Dagauchi of Japan’s Waseda University highlighted the current state of compensation following the Fukushima nuclear accident.

He reported that to date, the amount of compensation paid to accident victims had reached approximately $80 billion. The entity established to handle claims was the Nuclear Damage Compensation Facilitation Corporation and its funds have largely been provided by the Japanese Government, with repayment due over time with future recoveries from the Japanese nuclear operators.

Although there is certainly more compensation to be paid out, Professor Dagauchi notes that 85% of cases so far have been settled largely without dispute, and this is attributable to, in part at least, TEPCO’s ‘positive attitude towards proposals for settlement’. However, part of this positive attitude includes leaving the way open to claims against TEPCO from the existing claimants for any further damage occurring in future. TEPCO had little choice but to accept this future potential liability in order to ensure claims were settled.

Radiation Measurements

In another INLA paper by Roger Coates (President of the International Radiation Protection Association), entitled “A Practitioner’s View of Radiation and the Law”, the complexity of the current radiation measurements are noted as being confusing and maybe contradictory, with dose limits for man-made radiation often much lower than actual doses received by the public from natural sources.

Mr Coates points out that this has resulted in operators and authorities spending vast resources on achieving compliance so that small numbers of people receive tiny doses, whilst hundreds of thousands of people can go on vacation in high radon areas and receive higher doses. This confusion matters because, as the paper points out, although the risk from low doses is assumed to be very small, there remains scientific uncertainty as to the level of risk from radiation at low doses.

Nuclear Accident Insurance

From the perspective of an insurer, both these papers demonstrate some of the uncertainties that exist for the providers of financial security to the nuclear industry. This uncertainty is one of the reasons why a financial gulf exists between the $80 billion plus cost of a nuclear accident at Fukushima and the c. $1.2 billion statutory financial security available in Japan.

Not having a clear understanding of how much compensation will be paid, and when it will be paid, holds back insurers, who cannot easily estimate the loss scenarios required for their capital models. If political or public pressure leads to a wider scope of compensation being paid after the event (as in Japan), this can make a material difference to the insurers’ commitment.

Similarly, if inconsistent dose limits mean much greater expenditure is required to remedy nuclear damage, nuclear exposure compares unfavourably to other classes of insurance with more certain claim patterns.

Clarifying these (and other) issues in advance of a future accident will help to attract more insurance support to the nuclear sector. With greater certainty, over time the level of private insurance available for severe nuclear accidents could begin to catch-up with the tens of billions of dollars readily available for other more regularly occurring catastrophes.

Mark Tetley, Prospect Law Ltd

About the Author

Mark Tetley has wide experience gained from senior positions across the London insurance market as both an underwriter and a broker , in a variety of sectors. He provides advice and assistance on a wide range of insurance and risk issues, including comprehensive nuclear liability and property insurance assistance, complex infrastructure project programme design and review, claims and policy reviews, assistance with project insurance design and implementation in developing countries, and many other aspects of risk mitigation.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

Articles by William Wilson

Part 1

Part 2

Part 3

Part 4

Part 5

Part 6

Part 7

For a PDF of this blog click here

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REFLECTIONS ON THE INTERNATIONAL NUCLEAR LAW ASSOCIATION CONGRESS IN ABU DHABI (PART 7 OF 7): NUCLEAR TRANSPORT

Prospect has been invited to attend the bi-annual meeting of the International Nuclear Lawyers Association (INLA) in Abu Dhabi from 4-8 November 2018 – click here to see further information about the event 

On 6th November 2018, The International Nuclear Law Association congress in Abu Dhabi held important sessions on Nuclear Transport.

The following is a sample of the topics covered by the Nuclear Transport section of the International Nuclear Law Association congress in Abu Dhabi on 6 November 2018. We hope to be reporting more fully on this topic on a future occasion.

Tracy Murray, Sellafield Ltd, UK, described ‘Consignor Duties/Obligations During Transport Outside Transport Contracts’.

Khalil Bukhari, International Nuclear Services, UK spoke on the ‘Recovery of Nuclear Material During a Transport Incident – Risk, Liability and Insurance’. 

He discussed the particular transport risks inherent in loading/unloading, entering/exiting ports, canals and high seas, and the strategies for addressing and limiting these risks. He gave one example of a canal authority requiring shipowners to use the canal authority’s pilot, but still subjecting them to unlimited liability for any damage done to the canal. He showed a video of best and worst practice of loading/unloading.

He went on to discuss nuclear transport contracts, when liability passes, liability limits, exclusions and excesses and some of the day to day headaches of nuclear transport in practice. Residual liability issues such as salvage could be very significant. The key lay in careful preparation, and he advocated a focus on avoiding incidents.

Jean-Dennis Treillard, ELINI, France discussed the application of different liability conventions, and their impacts on the practical risks described by Khalil Bukhari. For a nuclear incident, responses would depend whether there was or was not radioactivity leakage. He reviewed the detailed implications set out in the different conventions for a radioactivity release for liability and applicable law. Both the Paris and Vienna Convention were silent about matters such as salvage liability and costs.

Ben Whittard, International Nuclear Services, UK had presented in an earlier session on ‘Cyber Security in Nuclear Transport’.

About the Author

William Wilson is a specialist environmental, regulatory and nuclear lawyer with over 25 years experience in government, private practice and consultancy. He worked as a senior lawyer at the UK Department of the Environment/DETR/Defra, and helped to build up the environmental and nuclear practices at another major law firm, as well as running his own environmental policy consultancies. William has experience of all aspects of environmental law, including water, waste, air quality and industrial emissions, REACH and chemicals regulation, environmental protection, environmental permitting, litigation, legislative drafting, managing primary legislation, negotiating EU Directives and drafting secondary legislation.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

For a PDF of this blog click here

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REFLECTIONS ON THE INTERNATIONAL NUCLEAR LAW ASSOCIATION CONGRESS IN ABU DHABI (PART 6 OF 7): RADIATION PROTECTION

Prospect has been invited to attend the bi-annual meeting of the International Nuclear Lawyers Association (INLA) in Abu Dhabi from 4-8 November 2018 – click here to see further information about the event 

On 6th November 2018, The International Nuclear Law Association congress in Abu Dhabi held important sessions on Radiation Protection.

This session of the International Nuclear Law Association congress in Abu Dhabi was highly technical but serious and important.

Roger Coates, OBE, former President International Radiological Protection Association gave the keynote speech on a ‘Practitioner’s View on Radiation and the Law’. This note attempts to do justice to his points, but is written by a non-scientist, who is responsible for any inexactitudes.

He noted that the IRPA had links with 52 Associate Societies in 67 countries and 18,000 individual members. It aimed to be the international voice of radiation protection worldwide.

He showed a slide measuring ‘likelihood of effects’ against ‘radiation dose’. The challenging point was at the lower end of the spectrum, where there was no direct evidence of effects. This was the area of uncertainty in which much regulated activity took place.

The primary aim of the system of regulation was to protect people and the environment from the harmful effects of radiation without limiting its beneficial effects. He ran through the principles of Justification, Optimization and Dose limitation, and Planned, Emergency and Existing exposure situations, ICRP publications and IAEA Standards. He then turned to some of the practical considerations applying to this system.

Mr Coates said that Dose limits are always seen as central to the rules of radiation protection, but in practice exposures are essentially determined by ‘optimisation’. The language of ‘limits’ suggested delineation between safety and danger. Natural exposure for everyone was at least 2mSv/y – but in emergencies 20mSv/y were allowed, which was confusing for the public.

Natural background dose could be increased by individual decision, such as flying, or living in a radon area. But much money was spent, for example, in getting potential doses from radioactive waste down to ‘clearance’ levels.

A ‘trivial’ dose of 0.1microSv/a was routinely required of the system of radiological protection, whereas holidaymakers in Cornwall might receive a few mSv of dosage without thinking about it. The challenge was how to bring that discrepancy into balance.

The principle of Optimisation or the ‘As Low As Reasonably Achievable’ ‘ALARA’ test had been an important and successful principle. But there was a growing concern amongst regulators that interpretation of this principle was moving towards ‘minimisation’. How low is ‘low enough’, when this costs more and more money?

On the concept of ‘prudence’, he illustrated the difference by showing a photograph contrasting the equipment needed to hike on an Alpine glacier with that needed for a stroll round his home village. Multiplying the factors of prudence and taking a conservative view limited the ‘clearance’ of material and escalated costs. He thought that we had to do better to get good value for society.

The ‘graded approach’ was recommended in many standards, such as those governing Naturally Occurring Radioactive Material ‘NORM’ in mining. Material above 1Bq/g was classed as ‘radioactive’ but often constituted little or no risk.

He thought that standards delivered by practitioners were generally higher than basic legal requirements. But he questioned the continuing efforts to spend resources on achieving ever lower levels of radiation at high cost to society.

About the Author

William Wilson is a specialist environmental, regulatory and nuclear lawyer with over 25 years experience in government, private practice and consultancy. He worked as a senior lawyer at the UK Department of the Environment/DETR/Defra, and helped to build up the environmental and nuclear practices at another major law firm, as well as running his own environmental policy consultancies. William has experience of all aspects of environmental law, including water, waste, air quality and industrial emissions, REACH and chemicals regulation, environmental protection, environmental permitting, litigation, legislative drafting, managing primary legislation, negotiating EU Directives and drafting secondary legislation.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

For a PDF of this blog click here

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REFLECTIONS ON THE INTERNATIONAL NUCLEAR LAW ASSOCIATION CONGRESS IN ABU DHABI (PART 5 OF 7): NUCLEAR SAFETY AND NON-PROLIFERATION

Prospect has been invited to attend the bi-annual meeting of the International Nuclear Lawyers Association (INLA) in Abu Dhabi from 4-8 November 2018 – click here to see further information about the event  

On 6th November 2018, The International Nuclear Law Association congress in Abu Dhabi held important sessions on Nuclear Safety and Non-Proliferation.

This session was chaired by Carlton Stoiber from the USA, a highly experienced Nuclear Lawyer. Carl is co-author of the IAEA’s ‘Handbook on Nuclear Law’, has helped develop, revise and improve nuclear laws in dozens of countries, and has taught and mentored hundreds of nuclear lawyers through IAEA schools, workshops and publications. Apart from a most distinguished career in public service in the USA, which included fascinating experience at the US Department of Justice during the Civil Rights Movement period, he is also a well known cartoonist, and punctuates meetings with the production of sly cartoons, to general consternation. Working with Carl on the nuclear law in a country in the Far East was a chance to learn from a genuine expert.

Kathryn Rauhut, Stimson Centre, USA discussed the concept of Design Basis Threat or ‘DBT’, and the distribution of responsibilities for security between the state and the operator. She covered the evolution of the DBT concept, from the Cold War and Cuban threats in the 1960s to its modern evolution and NRC requirements for aircraft impact assessment and provision for cyber security. She asked “How do you calculate risk when an AK-47 becomes a laptop computer?”, and discussed emerging threats from cyber attacks.

Jacqueline Kempfer, Stimson Centre, USA, said that on cyber attacks, utilities in Connecticut have reported more than a million probes into their systems, on infrastructure such as pipelines and dams. She argued that it was paramount that operators prepared, and showed that they had met the necessary standard of care. The standard of care required was constantly evolving as technology and the challenges to it evolved. In response to questions, the speakers agreed that the operators were truly in the front line for responsibility to defend against cyber attacks, except possibly in some cases of state sponsored attacks. Participants also discussed the low tech threats from people and insiders, for example causing sabotage or introducing viruses, or unwittingly responding to cyber attacks carelessly and thereby increasing exposure to them.

Anthony Wetherall, National University of Singapore spoke about the Amendment to the Convention on the Physical Protection of Nuclear Materials ‘CPPNM’. This covered physical protection provisions, criminalization and related provisions and international cooperation provisions. The CPPNM had originally focussed mainly on physical protection. The Amendment finally entered into force in 2016. Its provisions included new offences of smuggling and illicit trafficking, new definitions, a new suite of relevant IAEA guidance and a set of fundamental principles.

He discussed the application of the Amendment to international and maritime nuclear shipments, and the levels of protection required, as well as the awareness of their obligations of states where nuclear shipments, export and imports or transit took place in a flagged ship within their legal responsibility.

Abdelwahad Biad, Professor in International Law, University of Rouen spoke about the Treaty on the Prohibition of Nuclear Weapons. He said that the Treaty was prompted by the lack of any real progress in nuclear disarmament, and the failure of Nuclear Weapons States to meet their obligations under the Non Proliferation Treaty for negotiations in good faith to end the arms race at an early date.  It targeted the comprehensive abolition of nuclear weapons. No nuclear power had participated in the conference on the Treaty.

Ben Whittard , Head of Security & Resilience, International Nuclear Services, contributed a paper on the highly topical subject of ‘Cyber Security in Nuclear Transport’.

About the Author

William Wilson is a specialist environmental, regulatory and nuclear lawyer with over 25 years experience in government, private practice and consultancy. He worked as a senior lawyer at the UK Department of the Environment/DETR/Defra, and helped to build up the environmental and nuclear practices at another major law firm, as well as running his own environmental policy consultancies. William has experience of all aspects of environmental law, including water, waste, air quality and industrial emissions, REACH and chemicals regulation, environmental protection, environmental permitting, litigation, legislative drafting, managing primary legislation, negotiating EU Directives and drafting secondary legislation.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

For a PDF of this blog click here

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REFLECTIONS ON THE INTERNATIONAL NUCLEAR LAW ASSOCIATION CONGRESS IN ABU DHABI (PART 4 OF 7): FINANCIAL ASPECTS OF NUCLEAR LIABILITY

Prospect has been invited to attend the bi-annual meeting of the International Nuclear Lawyers Association (INLA) in Abu Dhabi from 4-8 November 2018 – click here to see further information about the event 

On 5th November 2018, The International Nuclear Law Association congress in Abu Dhabi held important sessions on Nuclear Liability and Insurance.

In the continuing session of the International Nuclear Law Association congress in Abu Dhabi, on 5 November 2018, on Nuclear Liability and Insurance, speakers covered some new developments in the area of nuclear liability and insurance, and returned to the familiar topic of the ‘channelling principle’ and whether there should be a right of recourse by nuclear operators against suppliers.

Jamie Fairchild, Canada talked about ‘Canada’s New Nuclear Civil Liability Regime: its key features and Operationalization’. He described the Nuclear Liability and Compensation Act, which came into force on 1 January 2017, and replaced the earlier Nuclear Liability Act. Operator exclusive liability would rise from CAN$75 million to CAN$1 billion.

Ben McRae, Assistant General Counsel, U.S. Department of Energy, USA gave a talk on ‘Examination of Continued Viability of the Channelling Principle, Taking into Account Recent Issues Raised by the Treatment of the “Right of Recourse” in Certain National Laws’.

Mr McCrae referred to section 17 of the Indian nuclear liability law, providing for a statutory right of recourse. In subscribing to the Convention on Supplementary Compensation ‘CSC’, India deposited a declaration that this was consistent with the CSC. Mr McCrae said that he personally thought that a right of recourse, by the operator against suppliers, made no sense, as it simply increased costs and the needs for extra insurance, although he conceded that it might be possible under the Convention. He thought that it would not be to the benefit of individual victims to have to be mired in tort litigation trying to attribute fault between parties.

Helena Kazamaki, ABB, France gave an address on the topic ‘Is Channelling at Risk?’, asking whether the principle in nuclear liability conventions that exclusive liability be channelled to the nuclear operator was under threat, and consider what implications that might have.

As a supplier, she said that ABB saw the right of recourse as an issue relevant to intentional acts, for negotiations by contract, or where the right of recourse was mandated by law, as in India. She gave a sobering assessment of the potential impacts of allowing a right of recourse against suppliers to become established in nuclear liability laws, and thought that the role of insurance in providing cover would be very important.

Alain Quéré , Switzerland and Achim Jansen-Tersteegen, Germany gave a useful introduction to the work of nuclear insurance pools. Ken Manne of NEIL, USA, presented on the comparative merits of captive mutual insurance, insuring over 90 operation nuclear units in the US and generating multi-billion dollar surpluses in coverage.

About the Author

William Wilson is a specialist environmental, regulatory and nuclear lawyer with over 25 years experience in government, private practice and consultancy. He worked as a senior lawyer at the UK Department of the Environment/DETR/Defra, and helped to build up the environmental and nuclear practices at another major law firm, as well as running his own environmental policy consultancies. William has experience of all aspects of environmental law, including water, waste, air quality and industrial emissions, REACH and chemicals regulation, environmental protection, environmental permitting, litigation, legislative drafting, managing primary legislation, negotiating EU Directives and drafting secondary legislation.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

For a PDF of this blog click here

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REFLECTIONS ON THE INTERNATIONAL NUCLEAR LAW ASSOCIATION CONGRESS IN ABU DHABI (PART 3 OF 7): 5 NOVEMBER 2018

Prospect has been invited to attend the bi-annual meeting of the International Nuclear Lawyers Association (INLA) in Abu Dhabi from 4-8 November 2018 – click here to see further information about the event

On 5th November 2018, The International Nuclear Law Association congress in Abu Dhabi held important sessions on Nuclear Liability and Insurance.

The first of these covered Post-Accident Consequences on Nuclear Liability Legislation: The Case of Japan.

Professor Masato Dogauchi, University of Tokyo, from Japan, spoke on ‘The Role of Nuclear Damage Compensation Facilitation Corporation in the Fukushima-Dai-ichi Accident’.

Professor Dogauchi said that TEPCO had in effect been “kept alive by an unlimited blood transfusion”. He stated that by 17 August 2018, the total amount TEPCO had paid to victims was about US$83 billion. For up to date figures, reference was made to the TEPCO Compensation webpage. A Dispute Reconciliation Committee and Nuclear Damages ADR Centre had been established. Such claims however do not foreclose claims for additional damage, and TEPCO remains at risk of further claims over time. Some 284 cases had been concluded, but 173 cases were still pending.

The Nuclear Damage Compensation Facilitation Corporation was established to fund TEPCO to use funds for compensating victims, and to require other nuclear operators to pay contributions to enable this Corporation to operate, based on annual operating revenue. Contributions are also required from the eight electric power companies. The government of Japan justified this by making it clear that the nuclear industry had not adequately accumulated enough funds: consumers had enjoyed cheaper electricity as a result. It was too late to accumulate funds from consumers after the event, but it was fair to impose this levy on electricity companies.

The system exposes TEPCO to truly unlimited liability. However, Professor Dogauchi concluded that the system was not necessarily apt to provide for another nuclear incident. A Retroactively Accumulated Reserve Fund was an important part of Japanese government policy, but was not necessarily a stable basis for all that may be required.

Julius F. Weltzdorfer, Germany gave an address on ‘Problems of Liability for Mental Distress in Fukushima: Evacuation Stress, Solitary Deaths, Suicides and Excess Abortions’ with news of academic research on the emerging Japanese caselaw and its implications for the revision of nuclear liability law to cover wider impacts.

Taro Hokugo, MEXT, Japan described a ‘Review of the Japanese Compensation Framework based on the Lessons Learned.’ Amongst other aspects of a review of legislative developments, he reported that the Bill to Amend the Compensation Act has just been decided by the Japanese Cabinet on 2 November 2018 and it was submitted to the Diet.

About the Author

William Wilson is a specialist environmental, regulatory and nuclear lawyer with over 25 years experience in government, private practice and consultancy. He worked as a senior lawyer at the UK Department of the Environment/DETR/Defra, and helped to build up the environmental and nuclear practices at another major law firm, as well as running his own environmental policy consultancies. William has experience of all aspects of environmental law, including water, waste, air quality and industrial emissions, REACH and chemicals regulation, environmental protection, environmental permitting, litigation, legislative drafting, managing primary legislation, negotiating EU Directives and drafting secondary legislation.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

For a PDF of this blog click here

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REFLECTIONS ON THE UAE NEW NUCLEAR PROGRAMME FROM THE INLA CONFERENCE (PART 2 OF 7): 4 NOVEMBER 2018

Delegates to the International Nuclear Law Association ‘INLA’ congress in Abu Dhabi on 4 November 2018 have now heard several key presentations about the UAE nuclear programme from knowledgeable speakers.

Prospect has been invited to attend the bi-annual meeting of the International Nuclear Lawyers Association (INLA) in Abu Dhabi from 4-8 November 2018 – click here to see further information about the event

Jacques Lavoie, INLA President and General Counsel of the Emirates Nuclear Energy Corporation ‘ENEC’ introduced the UAE programme, and was able to report that the Barakah NPP was 90% complete, with Unit 100% complete.

Obaid Al Mutawa, Deputy General Counsel at ENEC gave a brief history of the UAE programme, established to meet an anticipated trebling in energy demand in the Emirates.

David Scott, Advisor to the Executive Affairs Authority, gave a more detailed account of the evolution of the UAE programme. He reviewed and recalled the 2008 UAE White Paper, reflecting leading commitments to the highest principles and best practice, transparency, non-proliferation, safety and security, and cooperation with the IAEA.

2002 had seen a sharp oil price rise. There had been high growth in energy demand, population, and development, outstripping energy infrastructure. By 2006 there was not enough natural gas to support demand for air conditioning during the Gulf summer. Energy security reflections led to the establishment of a working group to consider options, the UAE then being 96% dependent on gas generation. By 2008, nuclear energy was recommended as part of the energy mix.

The UAE programme saw the establishment of an International Advisory Board. This worked both ways, bringing in know-how, and generating confidence overseas. Early reports were quite critical, but the public saw them being resolved. The UAE saw this as an important way of generating confidence in the programme in the early stages, now being replaced by more structured IAEA reviews. Town hall style meetings had also taken place to go out and engage with the public.

On non-proliferation, the UAE addressed the issue straight out in the legislation, which made it illegal to proceed otherwise. The UAE had ratified the Additional Protocol with IAEA.

FANR was set up as a substantially independent regulator in 2009. KEPCO was chosen as Prime Contractor. The UAE wanted an established design, and found that it worked better for a new nuclear country to use established technology. The UAE joined WANO, and joined the Convention on Nuclear Safety and the Joint Convention on Spent Fuel Management. Supervision by regulators included oversight by the Critical Infrastructure authority.

Cooperation with the IAEA was assured by full and unfettered access, but UAE has also always drawn on their expertise. The UAE has signed Bilateral Agreements on Nuclear Cooperation with a number of countries, including the UK, and the regulator FANR had signed corresponding agreements with foreign regulators and TSOs, again including the UK.

On sustainability, the UAE had been building nuclear capacity, through education, scholarship and training programmes, so now UAE has hundreds of trained engineers, PhDs, and qualified personnel, with the contribution from UAE itself increasing.

Dr Zoryana Vovchok, Director of the Department of Legal Affairs, FANR spoke about the establishment of FANR by the law of 2009, and FANR’s approach to the licensing of the first UAE NPP, from initial licences to construction stage licensing. By 2016, FANR had progressed to issuing Licences for transportation of Unirradiated Nuclear Fuel to ENEC, and for Handling and Storage of Unirradiated Nuclear Fuel to NAWAH ENERGY COMPANY.

Dr Vovchok gave an account of the extra work to take into account lessons learned from Fukushima, and further directions to ENEC to undertake assessments and extra stress tests and described FANR Regulations and Regulatory Guides, and the need to keep them updated.

About the Author

William Wilson is a specialist environmental, regulatory and nuclear lawyer with over 25 years experience in government, private practice and consultancy. He worked as a senior lawyer at the UK Department of the Environment/DETR/Defra, and helped to build up the environmental and nuclear practices at another major law firm, as well as running his own environmental policy consultancies. William has experience of all aspects of environmental law, including water, waste, air quality and industrial emissions, REACH and chemicals regulation, environmental protection, environmental permitting, litigation, legislative drafting, managing primary legislation, negotiating EU Directives and drafting secondary legislation.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

For a PDF of this blog click here

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PROSPECT LAW ATTENDS INTERNATIONAL NUCLEAR LAW ASSOCIATION CONGRESS IN ABU DHABI (PART 1 OF 7)

Prospect has been invited to attend the bi-annual meeting of the International Nuclear Lawyers Association (INLA) in Abu Dhabi from 4-8 November 2018 – click here to see further information about the event

Speaking on the first day of the International Nuclear Law Association congress in Abu Dhabi on 4 November 2018, Peri Lynne Johnson, Legal Adviser and Director at the IAEA Office of Legal Affairs, described some of the IAEA’s assistance to nuclear power programme developments in 144 countries.

She discussed developments since Fukushima in the application of the Convention on Nuclear Safety and the Joint Convention on Spent Fuel and Radioactive Waste Management, and the development of non-binding Codes of Conduct, including a new one published in 2018.

On nuclear liability, she referred to the ongoing work of the IAEA INLEX expert group, and for nuclear security, the IAEA’s work with the 39 state parties that had not yet joined the CPPNM Amendment.

For nuclear safeguards, she noted that 181 states were applying safeguards, and that 133 states have agreed to apply the Additional Protocol. However, as North Korea is amongst the states that have not signed up to these measures, there is still perhaps some way to go. With nuclear assistance, Ms Johnson noted that the IAEA reviewed about 20 states’ nuclear laws per year, and trained over 300 individuals in nuclear law.

About the Author

William Wilson is a specialist environmental, regulatory and nuclear lawyer with over 25 years experience in government, private practice and consultancy. He worked as a senior lawyer at the UK Department of the Environment/DETR/Defra, and helped to build up the environmental and nuclear practices at another major law firm, as well as running his own environmental policy consultancies. William has experience of all aspects of environmental law, including water, waste, air quality and industrial emissions, REACH and chemicals regulation, environmental protection, environmental permitting, litigation, legislative drafting, managing primary legislation, negotiating EU Directives and drafting secondary legislation.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query, please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

For a PDF of this blog click here

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RISK MANAGEMENT IN UK NEW NUCLEAR – EXPANSION OR EXPLOSION?

As HMG grapples with challenging decisions on how best to sustain energy security in the UK through potential investment in new nuclear power generation, ultimately it is appropriate risk management approaches that should remain at the heart of such decisions.

Mark Vickers, from Prospect’s Project Finance team, sets out an introduction to the issue.  

Risk Management & Nuclear New Build

There are few major infrastructure projects which share the fiendish complexity, costs and regulatory matrix of a new build nuclear power station.  Whether the UK public purse (and electricity consumers) end up supporting directly (or indirectly) SMRs or large-scale reactors (or a combination of technologies), the allocation and management of risk is a fundamental driver of how these projects should be developed.

The risk allocation is not simply between public and private balance sheets but also between the UK and overseas governments. As part of a comprehensive risk management approach, insurances can play an important role in this process, during design, construction, commissioning, operation and decommissioning phases.

In common with other safety critical industries, nuclear power developments are very closely controlled through national and international regulations, which govern all critical safety and security aspects. However, even the most comprehensive legislation and stringent supervisory  regimes can prove susceptible to human error, poor management culture and inappropriate behavioural standards.  No amount of insurance can remove these risks. Indeed, continuing corporate governance and accounting failures in non-nuclear industries, such as at Carillion and Tesco, demonstrate that the poor general business risk management lessons of the past need to be relearned with greatly sustained and continuing effort. The apparent or proximate cause of a failure of risk management processes may not in fact be the root cause.

Approach

So, against a more dynamic risk environment, whether arising from emerging cyber, domestic terrorism or climatic risks (or simply the changing nature of traditionally well understood nuclear risks), what risk management approach might HMG now adopt?

The environment for high risk investments in new nuclear (as indeed in many other infrastructure sectors) can increasingly be characterised as being “VUCA” (i.e. volatile, uncertain, complex and ambiguous).   As both promoter and steward of the UK’s industrial strategy, it is encouraging that HMG recognises the place for new nuclear developments in the National Policy Statement.  Nevertheless, a more holistic, less industry specific and non-siloed approach to nuclear risk management would seem appropriate for the modern age.

Whistleblowing & IT Security

For example, whistleblowing policies in nuclear projects will only prove effective if staff have the moral courage to challenge openly their leaders’ decisions where they believe such decisions clearly erode the integrity of risk management, safety or security standards. Further, the risks of embedded design faults, malevolent IT technology malware or inadequate staff background checks may require closer integration with national cyber security strategy and relevant expert agencies such as GCHQ.

Conclusion

New nuclear is certainly no exception to the typical infrastructure risks such as construction delays and cost overruns. These are present in all major infrastructure projects.  However, nuclear project risks increasingly exist alongside other, complex and emerging societal risks, which demand a more sophisticated analytical understanding and approach, especially so where the public purse is the ultimate risk taker.

About the Author

Mark Vickers is an experienced public and private sector complex risk consultant, with a focus on financing projects in energy and infrastructure. He was Director of Project Finance for NuGen’s planned 3.8GW new nuclear plant in Cumbria in the UK and is a director of a new energy start up technologies platform. Mark was previously a commercial & investment risk advisor at The Crown Estate, focused on new marine energy technology investments in UK waters, such as wave & tidal power, floating wind turbines and offshore transmission grids.

Prospect Law is a multi-disciplinary practice with specialist expertise in the energy and environmental sectors with particular experience in the low carbon energy sector. The firm is made up of lawyers, engineers, surveyors and finance experts.

This article remains the copyright property of Prospect Law Ltd and Prospect Advisory Ltd and neither the article nor any part of it may be published or copied without the prior written permission of the directors of Prospect Law and Prospect Advisory.

This article is not intended to constitute legal or other professional advice and it should not be relied on in any way.

For more information or assistance with a particular query please in the first instance contact Adam Mikula on 020 7947 5354 or by email on adm@prospectlaw.co.uk.

For a PDF of this blog click here