The operator of the crippled Fukushima nuclear plant on Friday admitted it had played down the risks to the facility of a tsunami for fear of the political, financial and reputational cost.

The admission is one of the starkest yet by Tokyo Electric Power Company (TEPCO), which has been criticised for trying to shirk responsibility for the worst nuclear disaster in a generation.

The report says before the huge waves of March 2011 smashed into the plant the company was aware defences against natural disaster were insufficient, but did not act because of the possible consequences.

"There was a latent fear that plant shutdown would be required until severe accident measures were put in place," Tokyo Electric Power Company (TEPCO) said in a report.

The document, entitled "Fundamental Policy for the Reform of TEPCO Nuclear Power Organization" says insufficient planning was done to prepare for a natural disaster.

It said "severe accident" measures were taken in 2002, but nothing since because of worries about how it would appear to people living nearby.

"There was concern that if new severe accident measures were implemented, it could spread concern in the siting community that there is a problem with the safety of current plants.

It also said any action might "add momentum to anti-nuclear movements".

The company, one of the world's largest utilities, admitted it was frightened by the prospect of getting sued if it acknowledged the safety regime in place was not up to scratch.

TEPCO, which has been lambasted as a secretive, elitist institution in cahoots with its regulator, produced the report after convening a panel of outside experts to review its nuclear programmes.

Friday's admission of failure is a sharp about-face from previous claims that the tsunami was beyond conventional scientific expectation and there was no way they could have reasonably prepared for it.

However, two separate investigation panels, set up by the government and the legislature, both found TEPCO had been blinkered to the potential risks.

Those risks became reality on March 11, 2011, when a towering tsunami triggered by a record offshore earthquake slammed into Fukushima Daiichi nuclear plant, knocking out cooling systems and sending reactors into meltdown.

The crippled units spewed radioactive materials across a wide area, contaminating a swathe of farmland in one of land-strapped Japan's key food-producing areas.

They also forced tens of thousands of people from their homes, many of whom are still living in temporary accommodation. Some may never be allowed to return.

The clean-up of the land and demolition of the reactors are expected to take decades, while many communities remain deserted.

The giant utility, which has since been nationalised, faces colossal compensation claims in addition to the cost of dismantling the Fukushima plant.

No one is officially recorded as having died as a direct result of the nuclear accident, although the natural disaster is believed to have killed almost 19,000 people.