The UN's nuclear watchdog on Monday kicked off a review of Japan's efforts to shut down the disaster-hit Fukushima plant after its operator began removing nuclear fuel.

In a ten-day mission, a 19-strong team from the International Atomic Energy Agency (IAEA) will look at progress so far in the complicated decommissioning process, as well as future plans for containing the worst nuclear accident in a generation.

"In particular, it will focus on the efforts to manage the contaminated water at the site and on the activities to transfer the fuel assemblies from the Unit 4 to a safer storage condition," said Juan Carlos Lentijo, the director of the IAEA's division dealing with the nuclear fuel cycle and waste technology who is leading the mission.

The mission, the second of its kind, which will take place until December 4, is expected to include a visit to the battered plant as well as interviews with people in the Japanese government, Fukushima operator Tokyo Electric Power (TEPCO) and other experts.

Last week TEPCO released video footage from inside the building housing Reactor No. 4, where an unprecedented operation is under way to remove spent fuel from a cooling pool, where they were being kept when a tsunami smashed into Fukushima in March 2011.

"It is maybe remarkable to say that they (have) started... the removal of the spent fuel in Unit 4," Lentijo told reporters Monday, adding that the task will allow workers to learn "lessons to be applied to the removal of the spent fuel in other units."

But he also said the issue of contaminated water was "one of the most important and challenging problems".

Thousands of tonnes of water used to keep fuel cool is being stored in huge tanks at Fukushima, with no clear plan for what will happen to it.

"To discuss with TEPCO in a detailed way on this issue, the mission team has included experts," Lentijo said. "This will permit us to assess the situation in detail and provide TEPCO additional advice if needed."

The IAEA will issue a preliminary report on December 4 and a full assessment around two months later.