* Japan aims to bring radiation levels below 20 millisieverts annually
* Thorough cleanup of areas frequented by children also a priority
* Group launched which will form core of new nuclear watchdog (Adds details on launch of new regulatory group)
By Shinichi Saoshiro
TOKYO, Aug 26 (Reuters) - Japan aims to halve radiation over two years in places contaminated by the Fukushima nuclear crisis, removing soil, plants and trees as well as cleaning roofs of buildings in an area spanning thousands of square kilometres.
The cleanup could cost tens of billions of dollars, and thousands of evacuees may not be able to return home for years, if ever.
Radiation in a contaminated area is estimated to fall naturally by about 40 percent over two years, and the government wants to speed up the process by another 10 percent through human efforts, according to guidelines for the cleanup unveiled on Friday.
"We aim to reduce radiation levels by half over the next two years in affected areas, and by 60 percent over the same period for places used by children," nuclear crisis minister Goshi Hosono told a news conference.
Another key government goal is to bring radiation below 20 millisieverts per year, the threshold level for evacuation, in areas where it is exceeded. Some places in the evacuation zone have levels that far surpass this, government data showed this week.
"Ultimately we want to achieve this goal in a shorter period. Technology is continuing to advance and with enough government funding and effort it can be done," Hosono said.
Japan has banned people from entering within a 20 km (12 mile) radius of the Fukushima Daiichi plant, which had its reactor cooling systems knocked out by the March 11 earthquake and tsunami, triggering meltdowns and a radiation crisis. Some 80,000 people have been evacuated from the area around the plant.
The guideline also calls for thorough cleanups in places frequented by children such as schools and parks, eventually pushing radiation levels in those places below 1 millisievert annually.
The total area in need of cleanup could be 1,000-4,000 square km (386-1,544 square miles), about 0.3 to 1 percent of Japan's total land area, and cost several trillion yen to more than 10 trillion yen ($130 billion), experts say.
One major problem the government faces is that removal of farmland topsoil could ruin fertile agricultural areas, and it plans to come up with guidelines to address this problem next month.
The government said it will take full responsibility for the soil and debris removed in the cleanup, but that as yet it does not have a permanent solution for storing the radioactive material and it would have to be kept within local communities for the time being.
"I reiterate that Fukushima prefecture will not become the final place of treatment for the debris," Hosono said.
NUCLEAR WATCHDOG
The disaster at Fukushima has prompted Japan to thoroughly rethink its energy policy including its enforcement of nuclear safety standards.
This month the government said it is setting up a new nuclear watchdog which will no longer be supervised by the trade ministry, which has traditionally promoted nuclear power.
Instead the organisation will be supervised by the environment ministry, seen as relatively untainted by the collusive ties with industry which plagued the existing agency.
"Crisis management, which had not been fully established before, will be embraced by the new organisation. The group gathered today includes personnel from law enforcement and national defence to achieve this purpose," said Hosono on Friday at an inauguration ceremony for a group that will form the core of the new regulatory body.
The group consists of members from various government ministries as well as the private sector and will form the basis of the new body to be launched in April. (Editing by Edwina Gibbs and Michael Watson)
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