Insight Nuclear Energy Forum Toronto March, 2012

1. Exploring the Impact of Fukushima on the Nuclear Industry Insight Nuclear Energy Forum Toronto March, 2012

2. Lessons for nuclear industry Nuclear is the best – not least worst way to generate electricity!

3. The Great Tohoku Earthquake (followed by Tsunami) Occurred 2:46 PM March 11, 2011 • Magnitude: 9.0 on the Richter scale • A tsunami of approximately 15 meters in height struck less than one hour later • These are natural disasters of historic proportions

4. Impact of Earthquake and Tsunami • Huge devastation • About 20,000 people dead • Entire communities wiped off the map • At least 332,400 buildings; 2,100 roads; 56 bridges; and 26 railways were destroyed or damaged. • Electricity, gas and water supplies, telecommunications, and railway service were disrupted. • The total economic loss in Japan is estimated to be about $500 billion • A true catastrophe

5. Fukushima Daiichi Accident • Fukushima Daiichi has 6 units, Units 1-3 were operating at the time of the accident while units 4 to 6 were shut down • The reactors automatically shut down upon earthquake; all safety systems actuated • Tsunami “knocked out” all off-site and on-site AC power • Reactor heated up and water pressure relieved to suppression pool, reducing inventory in reactors • Fuel cladding oxidized, lost integrity and generated H² by exothermic reaction with water • Hydrogen explosions in units 1 and 3 caused most of structural damage • Release of radiation to the environment (~37 TBq of Cesium isotopes) • >110,000 people evacuated from their homes Before Accident After Accident

6. Consequences of Accident • 3 deaths (industrial) • No radiation fatalities • Worker dose rates • Six workers exceeded total allowable emergency dose • 408 exceeded the normal worker dose • Average worker dose small at 22.4 mSv • Off site doses minimal • No long term radiation deaths anticipated • Huge social upheaval • Evacuees • Food production • Social stigma

7. Dose Rates Near Fukushima • Affected sites in Fukushima Prefecture • Namie, lite: 10-50 mSv • Katsurao, Minami-Soma, Naraha, Iwaki: 1-10 mSv • Rest of Fukushima Prefecture: 1-10 mSv • Neighboring prefectures • 0.1 to 10 mSv • Background radiation • 1 – 100 mSv • Avearge 2.4 mSv • Areas with a dose of 20 mSv/year above background should be cleaned up • to reduce doses by 50% for adults and by 60% for children within 2 years • to bring them to a long-term level of 1 mSv/year above background 1 mSv = 100 mRem

8. Nuclear in Japan • Fukushima Daiichi, Daimi, Oganawa and Tokai plants all shut down due to the earthquake • Remaining Japanese nuclear units have been going off line for routine maintenance but have not been allowed to restart • Today only 2 of 54 reactors (30% of generation) now operating and all will be down by mid summer • Performing “stress tests” to ensure safety • Need local permission to resume operations

9. The World Reacts • Germany • Decision to phase out nuclear power • 8 units down not to restart • Remainder to be closed by 2022 • Switzerland • Cancelled new build program • Will phase out nuclear power • China • Continued with plants under construction • Temporarily stopped new approvals to review impact of accident • Now restarted program • US • Remain committed to nuclear • Issued first license for a new plant in 32 years • UK • Remain committed to new build nuclear • Canada • Remain committed to nuclear power (both refurb and new build)

10. IEA WEO 2011 Low Nuclear Scenario – what happens if we give up on nuclear power? “Following this trajectory would depend on heroic achievements in the deployment of emerging low-carbon technologies, which have yet to be proven. Countries that rely heavily on nuclear power would find it particularly challenging and significantly more costly to meet their targeted levels of emissions.” • In this scenario by 2035, • coal demand increases to over twice the level of Australia’s current steam coal exports. • The increase in gas demand is equal to two-thirds of Russia’s natural gas exports in 2010.  • The increase in renewables-based generation is equal to almost five-times the current generation from renewables in Germany.  • Energy-related CO2 emissions also rise with increased use of fossil fuels in the power sector. Sources: IEA NEA “World Energy Outlook 2011"

11. Many Reports

12. Public Relations War • Nuclear industry is focused on showing the accident proves nuclear is safe • Opponents are focused on showing the accident proves that nuclear is dangerous! Everyone thinks of changing the world. No one thinks of changing themselves. (Leo Tolstoy)

13. World public opinion Shifting opinions Agree: Nuclear Power is relatively safe/important electricity source/should build new plants % Source: BBC World Service/Globe Scan, November 2011.

14. Understanding the public viewpoint Germany • Nuclear • Excellent safe operating nuclear power plants • No risk of tsunami or reason to believe that Fukushima can happen • Organic Farming • Contaminated bean sprout farm • 50 dead and 4000 sick throughout Europe Why is Germany committed to closing nuclear power plants and yet there is no great concern with organic farming safety?

15. The Answer • The public believes that organic farming is fundamentally safe and this was an isolated incident that can be corrected • The public believes that nuclear power is inherently dangerous and Fukushima supports this belief • And why do they believe this? • Because the industry taught them to……… • Even supporters often note that if we had other options we would use them, but since we don’t – we need to continue to use nuclear! “there is a common belief that while nuclear power may be safe; we are safely managing doomsday machines.” (John Rich, Executive Director WNA)

16. In Japan - People are afraid • Nobody knows when they can return to their homes • They fear long term effects of radiation What will happen to me?

17. The Current View of Nuclear Power • We must avoid severe accidents because the consequences can be catastrophic • Kill thousands of people immediately • Render entire communities and even countries uninhabitable for decades or longer • Kill even more people over time through radiation induced cancers • We must work hard to ensure the risk of an accident is very very low probability • Safety is paramount in everything we do • Talk about safety incessantly (increasing the fear) WRONG!

18. The Reality • Accidents do indeed happen • 14,000 reactor years of operation • 3 severe accidents (core melt) • Yet we often quote core damage frequencies as 10-5 to 10-7 • Fukushima was a very serious accident • Multiple units with core damage • Large infrastructure failures • Significant releases to the environment • Yet there have been no radiation fatalities and none are expected in the future • And Japan is not rendered uninhabitable • 20 km evacuation zone • Hope to get most residents back home

19. Important Lessons from Fukushima • Accidents happen – The industry must stop trying to convince the public that they won’t • Nuclear plants are very safe • As we learn, plants continue to get safer as we improve • We cannot imagine the unimaginable • There will be more accidents in the future • Increase focus on mitigating consequences and protecting the public from the highly improbable

20. Important Lessons from Fukushima • Even though bad accidents are unlikely and very rare, their consequences are manageable and are not apocalyptic - nuclear power will not destroy the world • To date accidents have had a limited impact in terms of fatalities (better than many other industries) • Fukushima demonstrates that there is no doomsday scenario and that people can be protected • Improvements will greatly reduce the risk of radiation releases • The biggest health impact is fear • Requires developing TRUST with the public

21. Important Lessons from Fukushima • Build confidence through improved global cooperation because an accident somewhere is an accident everywhere • Strengthen international peer reviews and the responsibility to respond by organizations such as the IAEA and WANO • WANO has stated that operators will be put under peer pressure if they fail to carry out WANO requirements on schedule, penalties can go as far as exclusion from the organization. • Among WANO’s post-Fukushima measures, a project team is also studying whether the association should require design modifications to be implemented at members’ nuclear plants If an operator is recalcitrant, or fails to implement measures from operating experience feedback reports, “we’ll go to CEOs [of all the other nuclear utilities] and tell them, ‘so-and-so is putting all the rest of you in danger.’” (Laurent Stricker WANO Chairman)

22. A new paradigm • Nuclear power is the best, not least worst way to generate electricity • Economic, reliable, clean and safe while providing high quality jobs to the community • Changing the thinking will take much effort and a long time but it needs to be done • It starts with the industry itself “That’s been one of my mantras – focus and simplicity. Simple can be harder than complex: You have to work hard to get your thinking clean to make it simple. But its worth it in the end because once you get there, you can move mountains.” (Steve Jobs)

23. The alternative.......

24. Thank You Milton Caplan MZConsulting Inc. - President milt.caplan@mzconsultinginc.com www.mzconsultinginc.com +1.647.271.4442