So You Think Nuclear Plant Liabilities Are Covered?

Issue Brief
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Nuclear Intelligence Weekly

So You Think Nuclear Plant Liabilities Are Covered?

Nuclear industry supporters are eager to allay public fears about the potential for another severe nuclear incident like Fukushima. A major issue is the possibility of extensive damaging consequences and compensation for those losses, with cyber being a topmost concern. The nuclear liability regime, a complicated labyrinth of national laws and treaties, promises victims will be compensated in the event of a severe nuclear incident. But is that true? Not necessarily, according to a panel of legal and insurance experts assembled by the Stimson Center in London last fall. Huge gaps remain, with cyber risks representing one of the greatest holes in the framework.

The nuclear liability framework helped encourage private investment in commercial nuclear power by capping operator liability in the event of an incident. An important feature is channeling of liability to the operator, meant to avoid lengthy litigation to establish legal responsibility and to provide a ready source of funds to compensate victims. But the international and domestic framework with liability caps may be irrelevant in the face of today’s range of threats, including perhaps most importantly cyber.