As you read this, you are using something. It’s the same
basic force which allows you to move, allows the earth to spin and your laptop
to turn on. In its crudest form, it’s energy. Oil, Gas and nuclear cores have
all become proponents which are driving factors behind the civilisation of
today. These vital materials construct
the basis of the economy and therefore affect the lives of each and every human
being on the planet.
We’ve recently been bombarded with some home truths about
using these specific materials in peculiar ways which have adverse effects on
the planet. I’m not going to bore you with an Al Gore style memorandum warning you
of the implications of global warming because you’ve most likely heard them an immeasurable
number of times. What I will remind you of however is that green energy has
never really been a viable alternative for many countries, just because of the
lack of innovation, and the timing. Nevertheless, in recent years, the
availability and more so the safety of these traditional energy sources have
become more and more precarious forcing us to seriously consider what the
future holds
In an attempt at keeping it simple, we look to the current energy
situation which is troubling Japan. It’s difficult to look at the worldwide
situation, because each country has its own politics, problems and economics
which determine their needs. In this instance, Japan’s recent energy crisis proves
to be a perfect case study to critically assess to what extent a green
revolution really is viable. In light of the Fukushima disaster, Japan’s energy
crisis has spawned into a multifaceted juggernaut of problems, encapsulating
everything from socio economic woes to political tremors. Luckily, as readily
as energy was the cause for most of their problems, it could also be the answer
to their problems.
Following the Fukushima nuclear disaster, Japan had become
the world’s largest importer of LNG or liquefied natural gas, which is also
known as one of the cleanest options for producing electricity without relying
of nuclear cores. For a while, it looked like Japan had learnt its lesson of
relying on nuclear cores as a main source of energy. However, there have been quiet
rumours within Japanese government of turning the nuclear reactors back on. Unsurprisingly,
58% of Japanese people polled were completely against turning on the reactors
again, and instead favoured alternative methods of energy generation. Of
course, Japan’s government have to look at it from an economic standpoint; LNG
is just too expensive. They spent
$60 billion importing 83.7 million metric tons in 2012. Unfortunately, a key feature of
short time frames and restricted supplies are higher costs. Immediately after
the disaster the only countries which could fulfil Japan’s requirements were
Qatar and Russia, both of which would have charged a premium on LNG after the resource
had been so heavily undervalued for more than a decade. Nonetheless, as more
options of supply appear for Japan, it necessarily becomes a more competitive
and viable long term option for the country. This is not a hypothetical
situation either, as Japan has also taken note that with America’s shale gas
boom, to import American gas, for the same purpose of producing electricity, would
work out cheaper. Nevertheless, there still remains a more
suitable option both economically and environmentally which we will soon explore.
In any case, this situation which Japan has found itself in has
had a multitude of consequences. Most significantly, the political economy is
in turmoil over the apparent lack of communication or support from the
government to the survivors of the tsunami and equally importantly the rumoured
disregard for the wellbeing of Northern Japan. This has led to the vast
majority of the country becoming disillusioned with the current state of the
government.
Essentially, Japan’s problems are
two pronged: One of securing a sustainable energy supply; and also of mending
the broken rapport with its own citizens.
So here’s where the solution
comes in: Green Energy. Sounds a bit anti climatic right? Wrong. Before you
shut it down as green fingered garbage take a second to think about the
economic and investment opportunity which arises from all of this.
To begin, let’s contemplate
investment from an energy/ utility
company’s perspective. Firstly, large utility companies such as E.on and other European
and Asian firms have already begun developing green technologies to harvest
green energy. From a statistical standpoint, between 2010 and 2011, Japan saw a
25% increase in demand for energy from solar power alone. In terms of having
experts in solar farms and the production of solar energy, Japan is being
forced to look abroad to established European energy companies who have
expertise in this area. At the same time, European energy companies are coming
to grips with the fact that the International energy agency has predicted a 2%
decrease in Europe wide demand over the next decade, making Japan and the rest
of Asia a very viable financial prospect. For Japan, what does this mean
exactly? It means a wealth of new investment opportunities which could see it
become a world leader in innovative energy technologies. This would essentially
place Japan not only at the centre of an environmental revolution, but also a
financial one. Since 2002, Japan’s GDP growth has pretty much remained between
-5.5% and 2%. Couple this tragic fact with the knowledge that imports as a percentage
of GDP in the same period have grown by 4% whilst exports have grown by only
1%, you’ve got yourself a dire situation. For Japan to return to the glory days
of being a financial powerhouse, they need something drastic to happen.
Now if we take a sociological
framework and look at the green revolution, we can recognise some immediate
benefits. Turning back on the reactors is one thing, but facing the public
backlash is another; Japanese support for whichever route the government will
go is essential. It’s not always been the case as most Japanese citizens have
refrained from commenting on the government’s choices in the past, but as the
younger and more outspoken generation of Japanese come into the frame, it
becomes a real issue which the politicians must consider. The energy crisis has
actually become a precursor to many underlying political tensions which the
country is currently facing. In the wake of the 2011 crisis, suicide rates sky
rocketed amongst the survivors of the tsunami, who felt they were abandoned and forgotten by the Government;
Even now, in the north of Japan, public opinion is largely against the
Government. Enson Inoue, whose missions we have been following has kept us all
updated on the real situation which still exists in Japan. People are still
living in make shift camps and school halls with little more than the basic
necessities. This sort of reality doesn’t bode well for the politicians in
Tokyo. Let us not be misled here though; Green revolution doesn’t forgive the
government, but it shows that they have learnt from their mistakes and are
safeguarding Japan’s future. Often times it’s not the “sorry” that counts but
the action you take to rebuild.
It’s no longer a case of discussing
things from simply an economic angle because as Keynes said, in the long run
we’re all dead. And although ultimately it will be economics and statistics
which have the final say, we have to look at this situation from a view of
improving society and leaving a legacy to the future which we won’t necessarily
be a part of. This decision will ultimately affect each and every human being
that walks this planet today as well as generations to come. Nevertheless,
caveats of information like this seem to hold little to no bearing upon
politicians who are undeniably satisfying the wills of major corporations. I
was actually a little disturbed today when I found out that right here at home,
Mr. David Cameron went as far as saying that fracking for oil in the UK would
cause no harm to the environment. Absurd, preposterous and naïve- All of the
above can be used to describe this sort of rhetoric, especially when the UK has
some extremely exciting prospects for green energy. With these sorts of short
sighted ideas, options like the one Japan is currently faced with are simply
brushed under the rug, in hopes that this energy crises will simply disappear.
It’s easy to
brush topics like this under the rug, and it’s easy to say what we should and
shouldn’t do, but in today’s world, the only thing which will define the future
is the bottom line. That’s it. It’s that simple, and although we can look at
the green revolution from a moral perspective, the more realistic and
persuasive way of looking at it is through economics and the monetary profits
of it. For the first time ever a well-developed nation has all the right
circumstances and abilities to make this a financial reality as well as secure
a future. What we are witnessing is more so an evolution than revolution to be
honest, humans are meant to evolve and so are economies. This could be the end
of an era, but also the beginning of a new one. Keep your eyes on Japan,
because the moves they make along with the UK in the next few years will surely
determine a future for pretty much all of us.
By Viren Samani
(@VirenSamani1)
