(Refiles to fix word in paragraph 59)
* Tokyo Electric ignored own study on tsunami risk
* Utility decided safety issues, not regulators
* Kept vulnerable vent systems despite quake data
* Tokyo Electric cited the most for safety violations
TOKYO, March 29 (Reuters) - Over the past two weeks, Japanese government officials and Tokyo Electric Power executives have repeatedly described the deadly combination of the most powerful quake in Japan's history and the massive tsunami that followed as "soteigai," or beyond expectations.
When Tokyo Electric President Masataka Shimizu apologised to the people of Japan for the continuing crisis at the Fukushima Daiichi nuclear plant he called the double disaster "marvels of nature . that we have never experienced before".
But a review of company and regulatory records shows that Japan and its largest utility repeatedly downplayed dangers and ignored warnings -- including a 2007 tsunami study from Tokyo Electric Power Co's senior safety engineer.
"We still have the possibilities that the tsunami height exceeds the determined design height due to the uncertainties regarding the tsunami phenomenon," Tokyo Electric researchers said in a report reviewed by Reuters.
The research paper concluded that there was a roughly 10 percent chance that a tsunami could test or overrun the defenses of the Fukushima Daiichi nuclear power plant within a 50-year span based on the most conservative assumptions.
But Tokyo Electric did nothing to change its safety planning based on that study, which was presented at a nuclear engineering conference in Miami in July 2007.
PDF of this special report: r.reuters.com/pum78r
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Meanwhile, Japanese nuclear regulators clung to a model that left crucial safety decisions in the hands of the utility that ran the plant, according to regulatory records, officials and outside experts.
Among examples of the failed opportunities to prepare for disaster, Japanese nuclear regulators never demanded that Tokyo Electric reassess its fundamental assumptions about earthquake and tsunami risk for a nuclear plant built more than four decades ago. In the 1990s, officials urged but did not require that Tokyo Electric and other utilities shore up their system of plant monitoring in the event of a crisis, the record shows.
Even though Japan's Nuclear and Industrial Safety Agency, (NISA) one of the three government bodies charged with nuclear safety, cataloged the damage to nuclear plant vent systems from an earlier earthquake, it did not require those to be protected against future disasters or hardened against explosions.
That marked a sharp break with safety practices put in place in the United States in the 1980s after Three Mile Island, even though Japan modeled its regulation on U.S. precedents and even allowed utilities to use American disaster manuals in some cases.
Ultimately, when the wave was crashing in, everything came down to the ability of Tokyo Electric's front-line workers to carry out disaster plans under intense pressure.
But even in normal operations, the regulatory record shows Tokyo Electric had been cited for more dangerous operator errors over the past five years than any other utility. In a separate 2008 case, it admitted that a 17-year-old worker had been hired illegally as part of a safety inspection at Fukushima Daiichi.
"It's a bit strange for me that we have officials saying this was outside expectations," said Hideaki Shiroyama, a professor at the University of Tokyo who has studied nuclear safety policy. "Unexpected things can happen. That's the world we live in."
He added: "Both the regulators and TEPCO are trying to avoid responsibility."
Najmedin Meshkati, a professor of civil and environmental engineering at the University of Southern California, said the government's approach of relying heavily on Tokyo Electric to do the right thing largely on its own had clearly failed.
"The Japanese government is receiving some advice, but they are relying on the already badly stretched resources of TEPCO to handle this," said Meshkati, a researcher of the Chernobyl disaster who has been critical of the company's safety record before. "Time is not on our side."
The revelation that Tokyo Electric had put a number to the possibility of a tsunami beyond the designed strength of its Fukushima nuclear plant comes at a time when investor confidence in the utility is in fast retreat.
Shares in the world's largest private utility have lost almost three-fourth of their value -- $30 billion -- since the March 11 earthquake pushed the Fukushima Daiichi nuclear plant into crisis. Analysts see a chance the utility will be nationalized by the Japanese government in the face of mounting liability claims and growing public frustration.
AN 'EXTREMELY LOW' RISK
The tsunami research presented by a Tokyo Electric team led by Toshiaki Sakai came on the first day of a three-day conference in July 2007 organized by the International Conference on Nuclear Engineering.
It represented the product of several years of work at Japan's top utility, prompted by the 2004 earthquake off the coast of Sumatra that had shaken the industry's accepted wisdom. In that disaster, the tsunami that hit Indonesia and a dozen other countries around the Indian Ocean also flooded a nuclear power plant in southern India. That raised concerns in Tokyo about the risk to Japan's 55 nuclear plants, many exposed to the dangerous coast in order to have quick access to water for cooling.
Tokyo Electric's Fukushima Daiichi plant, some 240 km (150 miles) northeast of Tokyo, was a particular concern.
The 40-year-old nuclear complex was built near a quake zone in the Pacific that had produced earthquakes of magnitude 8 or higher four times in the past 400 years -- in 1896, 1793, 1677 and then in 1611, Tokyo Electric researchers had come to understand.
Based on that history, Sakai, a senior safety manager at Tokyo Electric, and his research team applied new science to a simple question: What was the chance that an earthquake-generated wave would hit Fukushima? More pressing, what were the odds that it would be larger than the roughly 6-meter (20 feet) wall of water the plant had been designed to handle?
The tsunami that crashed through the Fukushima plant on March 11 was 14 meters high.
Sakai's team determined the Fukushima plant was dead certain to be hit by a tsunami of one or two meters in a 50-year period. They put the risk of a wave of 6 metres or more at around 10 percent over the same time span.
In other words, Tokyo Electric scientists realised as early as 2007 that it was quite possible a giant wave would overwhelm the sea walls and other defenses at Fukushima by surpassing engineering assumptions behind the plant's design that date back to the 1960s.
Company Vice President Sakae Muto said the utility had built its Fukushima nuclear power plant "with a margin for error" based on its assessment of the largest waves to hit the site in the past.
That would have included the magnitude 9.5 Chile earthquake in 1960 that killed 140 in Japan and generated a wave estimated at near 6 meters, roughly in line with the plans for Fukushima Daiichi a decade later.
"It's been pointed out by some that there could be a bigger tsunami than we had planned for, but my understanding of the situation is that there was no consensus among the experts," Muto said in response to a questi