Lessons from Fukushima by Fortune Editors @FortuneMagazine March 28, 2011, 9:43 AM EST E-mail Tweet Facebook Google Plus Linkedin Share icons Japan’s nuclear catastrophe has triggered a wave of debate across nations about the future of nuclear energy, but everyone can agree that safety improvements are needed now. By Charles Perrow, contributor FORTUNE — We continue to populate our planet with systems that have catastrophic potential despite the known risks. Case in point: Nuclear power plants, which house fearful concentrations of hazardous materials, are often located in densely populated areas, and whose owners wield great political clout thanks to consolidation in the nuclear power industry. Unfortunately we are now seeing the consequences of this centralization. Japan, an island without other energy sources, has sprinkled its coastline with nuclear power plants; two, the Fukushima and the Onagawa facilities, were built in an area known for its seismic activity. Documents show regulators and managers in Japan treated “worst case” events as outliers—not real risks. In 2006 a group called the Nuclear Safety Commission recognized the danger of tsunamis hitting Japan’s coastal plants but reassuringly concluded: “Even for a nuclear plant situated very close to sea level, the robust sealed containment structure around the reactor itself would prevent any damage to the nuclear part from a tsunami, though other parts of the plant might be damaged. No radiological hazard would be likely.” We now know how inadequate those containment structures proved to be. The nuclear industry is dominated by a handful of companies. Westinghouse was bought by Toshiba; the French company Areva dominates in Europe and is now in joint projects in the U.S., one company supplies it with a third of its electric power. Exelon EXC and Entergy ETR run most of them in the U.S. Consolidation has given companies size and influence to lobby governments for less oversight, which helps them operate more efficiently–and maximize profits quarter after quarter. (Though the industry by necessity has to think long term—due to permissions and planning it may take 10 years to build a facility that will have a 40- to 60-year life span—nuclear power companies are as beholden to Wall Street’s short-term mentality as any corporation.) But perhaps a more threatening form of concentration in this dangerous industry is at the facility level. One of Tokyo Electric’s facilities has 7 plants on one site; Fukushima Daiichi has 6 and plans to build two more there. This makes them obvious targets for a “common mode” failure such as loss of off-site power and flooding of sources of emergency power, increasing the danger six-fold. Had the facilities been required to disperse their plants, at some small economic penalty, earthquake and tsunami risks would be greatly reduced. The silver lining? Regulators now say they will use lessons from the disaster at Fukushima to improve nuclear plant safety. On March 12 the American Nuclear Society noted the dire events, but continuing the tradition of risk analysis in the industry reassured us: In an event like this, “containing the radioactive materials could actually be considered a ‘success’ given the scale of this natural disaster that had not been considered in the original design. The nuclear power industry will learn from this event, and redesign our facilities as needed to make them safer in the future.” In our disasters is our salvation. –Charles Perrow, emeritus professor of sociology, Yale University, is the author of The Next Catastrophe. More from Fortune on the future of nuclear power: The biggest threat to nukes might be Wall Street Japan’s nuclear crisis won’t derail world energy markets What’s next for nuclear power?