The recommendation was included in a preliminary report released Wednesday, following a 10-day review by IAEA's 19-member team -- headed by Juan Carlos Lentijo, the agency's Director of Nuclear Fuel Cycle and Waste Technology -- to observe the decommissioning process at the plant, stricken by an earthquake and tsunami in March 2011.
Tepco last month started the delicate operation of removing more than 1,000 nuclear fuel-rod assemblies from the spent fuel pool inside the damaged No. 4 reactor building. Tepco expects to complete that process by the end of 2014.
The overall decommissioning work at the stricken nuclear plant, however, is expected to take as long as 40 years.
In addition to the decommissioning process, Tepco continues to grapple with the ongoing problem of managing the massive amount of radioactive water accumulating at the plant. Although the utility has set up about 1,000 tanks to store the toxic water, the substance continues to accumulate at a rate of about 400 tons a day.
The possibility of accidental leaks from those tanks is a concern.
"It is necessary to find a sustainable solution to the problem of managing contaminated water at Tokyo Electric Power Co.'s Fukushima No. 1 nuclear power station," the IAEA preliminary report says. "This would require considering all options, including the possible resumption of controlled discharges to the sea."
The IAEA team said Tepco first should assess the potential radiological impact to the population and the environment.
The chairman of Japan's Nuclear Regulation Authority, Shunichi Tanaka, acknowledged during a news conference Wednesday that keeping all low-level contaminated water at the site would create an obstacle for the decommissioning work.
"You cannot keep storing the water forever. We have to make choice comparing all risks involved," Tanaka said, The Wall Street Journal reported.
The IAEA team suggested waste facilities be planned to support the decommissioning process for its lifetime and a laboratory be established for waste characterization.
While the IAEA team acknowledged Japan's commitment to the decommissioning of the facility, it warned that challenging issues remain.
"Japan has established a good foundation to improve its strategy and to allocate the necessary resources to conduct the safe decommissioning of Fukushima Daiichi," said Lentijo, the IAEA team leader, in a statement. "The situation, however, remains very complex, and there will continue to be very challenging issues that must be resolved to ensure the Plant's long-term stability."
The IAEA team plans to submit its final report to Japan by the end of January.