RNPP authority wants govt guarantee, not insurance to cover civil damage liability

The Rooppur Nuclear Power Plant (RNPP) authority wants to cover the civil liability for nuclear damage through furnishing a government guarantee instead of buying insurance policy until the plant begins power generation.
The authority considers it necessary to cover the possible damages during transportation of nuclear fuel from Dhaka airport to the plant site by road which is scheduled to start in October next.
It also wants the government to bear the liability of civil damage instead of the plant operator.
The Ministry of Science and Technology (MoST) in a letter to the Ministry of Finance (MoF) last week sought the guarantee.
Officials concerned said that under the International Conventions on Civil Liability for Nuclear Damage and National Regulatory Law, the operator or licensees are legally responsible for any kind of incidents at the stage of commissioning, operation, maintenance, and transportation of nuclear substances and fuel for nuclear facilities.
At the same time, the convention made mandatory arrangement of required funds to provide compensation for the damages in case of any incident.
According to section-43 of the Bangladesh Atomic Energy Regulatory Act 2012 (BAER Act-2012), local and foreign operators are responsible for any kind of incidents linked to nuclear facilities.
And, they have to buy a required insurance policy or ensure any other financial security to provide a required fund for paying compensation in case of any incident.
The BAER Act-2012 also mentioned that if the operator is unable to meet any civil damage linked financial demands, the government will ensure required funds for the payments.
Officials said that for the Unit-1 and Unit-2 of the RNPP, the financial liability for any civil damage is equivalent to US$450 million. The plant authority or the government has to create a financial coverage of a similar amount through buying insurance or arranging a state guarantee.
Contacted, RNPP project director Dr. Mohammad Shawkat Akbar told the FE on Sunday that there is an obligation for creation of such a fund according to the international convention.
"If the government gives us indemnity, an additional $450 million would not be added in the total project cost," he said.
Mr Akbar said the international convention mentioned the creation of a 'single point liability' to file cases for compensation in case of any civil damage.
"Since the government itself is the owner of the RNPP, we requested the government to give the plant indemnity and take the liability by itself for any civil damage," he added.
He further said no nuclear incident so far occurred globally until now in case of transportation of nuclear fuel.
Alak Chakraborty, head of finance at the RNPP project, said there is no chance of an incident occurring while transporting nuclear fuel even if people come in contact. But the international convention made funding arrangements or insurance coverage mandatory as a precaution.
He said in Bangladesh there is no insurance company that can give full coverage for nuclear liability.
The Sadharan Bima Corporation (SBC), if approached, will go for reinsurance for over 95 per cent to a foreign company that means most of the premium will go abroad.
"We want to buy insurance coverage when the plant goes to commercial operation and make money. Then paying a premium will be easier for the plant from its own earnings," he said.
Mr Chakraborty said the plant is not going for commercial operation just after fuel reaches the plant site - going for production may need one more year.
"Until chain reaction of nuclear fuel starts at the reactors, there is no possibility of radiation," he noted.

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