13 Comments

Just ran across this on Semafor, for those interested in this issue:

https://www.semafor.com/article/08/25/2023/japans-climate-ira-missed-opportunity

Expand full comment

Thanks for another thought-provoking article. I live near Japan's largest geothermal energy plant in Kyushu. While it took a while for the locals--including many onsen proprietors--to accept this facility, now everything seems to be going smoothly. Why not develop this abundant natural resource throughout the country?

Expand full comment

It's just amazing to see the determination not just in Japan but elsewhere to stick heads in the sand and avoid serious confrontation of these issues. You'd think that with red lights flashing everywhere, policymakers would engage their brains and will to find credible solutions. But apparently not. The survival of most of humanity doesn't seem to be a big enough motivator. What are these people drinking?

Expand full comment

Mr. Katz, METI's vision that you dissect here is absolutely critical, not only for molding the entire character of Japan's energy policy, but also for the future of the energy transition throughout the Asia-Pacific. METI's pessimism toward renewables creates a justification for its support for "advanced" fossil fuel technologies, which it claims are green and pushes to other Asian countries.

I'll be writing about the role that these narratives play in the next week or so. I'll keep you posted.

Expand full comment

Thanks. Please call me Rick

Expand full comment

This proselytizing for fossils in developing Asia is really important and really bad. Keep me posted.

Expand full comment

Here's a fairly long piece that elaborates on what I think is Japan's energy transition narrative. I think it fits well with your reading of METI's views on renewables.

https://open.substack.com/pub/powerjapan/p/g7-pseudo-decarbonization?r=2140fn&utm_campaign=post&utm_medium=web

Expand full comment

Thanks. I'll read it.

Expand full comment

Japan as a whole gradually slides into a developing country. More Japanese investments keep sliding down internationally. I haven't seen any Japanese company (an individual one not a whole group of companies pooling together) taking a single project of billions of dollars like what Samsung/TSMC does with semiconductors or Chinese companies with electric cars/AI or American companies at doing anything. Japan's credit rating is dangerously reaching to A- as it's currently at A. If Bank of Japan fails to suppress yield rates, then it will be a trip down below A- which will be lower than Malaysia. Officially, Japan will become a developing country by that measure since credit rating is highly crucial for any company/any nation to gain financial resources globally. A good Nikkei Asia article on this matter.

https://asia.nikkei.com/Economy/Bank-of-Japan/BOJ-unwinding-stokes-fears-of-government-bond-downgrade

https://asia.nikkei.com/Editor-s-Picks/Interview/Japan-s-SMFG-looks-outside-traditional-banking-for-growth-CEO

https://asia.nikkei.com/Economy/Japan-s-low-credit-rating-keeps-good-companies-down

If any of you spends times to actually reading Japanese articles in Yahoo News, more Japanese experts echo this sentiment more. It's just JICA and METI pretending Japan to be "rich" which still is. More like the Argentinian type of richness. At least, Shinzo Abe was well aware of Japan's decline to force the weakening of the Yen through Abenomics. It helped to rally foreign investors (Asians but mostly Chinese) into Japan that can now enable some growth in the country at the detriment of poor Japanese population akin to the UK being swallowed by Indian/Middle Eastern elites for years!

Expand full comment

METI's lack of "ambition" is the real issue.

Expand full comment

They don't have any money or power to rally foreign capitals. They just draw fancy projects to pretend Japan being rich. Just think about the fabled semiconductors projects that METI announced. Nothing is yet to be done about the fable of 2nm fabs!!

The company behind that project is already calling for Japanese government to inject taxpayer money and allow it being publicly listed! WITHOUT a single fab or any production! Under METI, JOLED as a state-owned enterprise also went bankrupt recently.

Expand full comment

The thing is I don't really think it is a matter of Money...and the foreign capital companies are keen to run the projects...if the government/METI were willing to assist with some of the key issues here (ie. winning over the local stakeholders, making the process of bidding on projects clearer, and driving the T&D companies to provide adequate service to these projects).

Expand full comment

The problem here is the Japanese pride. These elites in Japan manage to rule over the country for years through creating the mythical threats of foreigners invading them to ruin the Japanese ways of life. That's why you see TV shows about foreigners praising Japan or highlights of foreign crimes in Japan. In shadow, these same elites receive money from the Unification Church, while they dehumanize Koreans at every attempt possible. This also applies to various foreign entities that Japanese media constantly portrays negatively.

You're right that they don't fear foreign ownership or takeover. However, It's absolutely critical for them to trick the Japanese populace with the illusion of Japanese "control" over foreign capitals within Japan. However, this myth gradually dies down as more Japanese people become poorer and take any chance to make more income including to sell out assets to foreigners (mostly Chinese and other SEA).

The only thing matters to boost more renewable projects in Japan is the profit for foreign capitals. I talk to Asian investors in this field, and they think the current incentives in Japan aren't attractive profitably. They can make more money within their nations comfortably due to better incentives. Meanwhile, Chinese investors tell me bluntly that Japan has become poor.

Expand full comment