TT-983 -- The Real Cost of the Fukushima Daiichi Melt Down, e-biz News from Japan

* * * * * * * * * TERRIE'S TAKE - BY TERRIE LLOYD * * * * * *
A weekly roundup of news & information from Terrie Lloyd, a long-term
technology and media entrepreneur living in Japan.
(http://www.terrielloyd.com)

General Edition Monday, Mar 11, 2019, Issue No. 983

- What's New -- The Real Cost of the Fukushima Daiichi Melt Down
- News -- U.S. to quintuple bases charges to Japan?
- Corrections/Feedback -- Bureaucracy holding Japan back
- Travel Picks -- Shochu in Kagoshima, Monkeys in Kyoto
- News Credits

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+++ The Real Cost of the Fukushima Daiichi Melt Down

Today is the eighth anniversary of the Great East Japan Earthquake,
and some days from now for the hydrogen explosions at the Daiichi
power plant in Fukushima, which spewed radioactive particles over a
large swathe of Fukushima prefecture and as far away as Shizuoka and
its green tea plantations. Thus we thought it appropriate to take a
look at the cost of cleaning up the mess.

The Japan Center for Economic Research (JCER), a Tokyo-based think
tank related to the Nikkei newspaper, recently released an update
report stating they think the cost of cleaning up the Fukushima
Daiichi power plant has now risen to around JPY81trn, if the
government persists in its current track of trying to completely
remove the tons of melted down nuclear fuel at the bottom of reactors
1, 2, and 3. This is a hugely more expensive estimate than the
JPY22trn put forward by the Ministry of Economy, Trade, and Industry
{METI) some years ago. Why the 370% difference? It seems that the JCER
team calculates that the treatment and disposal of contaminated water
will be far more costly than the government estimates, to the order of
JPY40trn versus JPY8trn. As can easily been seen from aerial
photographs, the government cost estimate of JPY8trn for containing
the 1.09m tons of contaminated water produced so far (stored in 900
tanks), let alone another 35-40 years (or 200 years, depending on who
you talk to) of similar containment, then treatment, then release,
does seems unreasonably low.

For an overview of the main cost estimation differences between the
JCER quote and the METI one:

* Decommissioning reactors - JPY11trn (METI - JPY8trn)
* Decontamination of site & surrounding areas - JPY20trn (METI - JPY6trn)
* Compensation to victims - JPY10trn (METI - JPY8trn)
* Treating and disposing contaminated water - JPY40trn (METI - JPY0)

The JCER report did say that if the government simply enclosed the
failed power plant with a concrete sarcophagus, as was done in Russia,
then the remediation cost would probably drop to around JPY35trn.
However, the government appears committed to completely remove the
nuclear debris and other site contamination, as a show of solidarity
with locals who otherwise would never be able to return home. As is so
often true with politics, though, this is probably less a case of
worrying about a few thousand people in nearby towns than it is a
signal to all the other local communities around Japan who have
allowed a nuclear power plant to be built nearby. If the worst
happens, the government has your back. And so in return, those same
local communities are expected to vote for resumption of nuclear
power.

The JCER report says that these clean up numbers show the true cost of
nuclear power and that there needs to be a more serious debate at
national level about whether Japan should continue with nuclear. The
LDP as the party-of-the-status-quo is unfortunately "married" to the
fiefdom structure of Japan's power utilities, who despite incompetence
and in some cases criminal liability, remain incredibly powerful
politically. Equally unfortunate is that only nuclear offers a
sufficiently compact and energy-rich power source so as to allow these
entrenched regional elites to not have to share the golden goose with
other companies or worse still (in the case of alternative power
sources like solar) with the public. This political reality is in
addition to the fact that burning hydrocarbons that have to be
imported, also makes nuclear compelling from an economic point of
view.

But what we find interesting is that neither JCER nor METI seem to be
trying to quantify the full economic impact of the Daiichi disaster.

[Article continues below...]

------ Terrie's Slow-Poke Cycling Tour - Kyushu -------

Last year we threatened to run a cycling tour for readers, but got too
busy to actually do it. So this year we're making amends. The first
tour, which will happen in the third or fourth week of April (just
before Golden Week) will be a 5-6 day ride in Kyushu - most likely in
the Nagasaki region. This tour, and a Hokkaido tour in late August or
early September, will have a common format.

1. The tours are potluck, not professionally run. No complaining.
Jokes and helping each other out are mandatory.
2. There will be no support cars or spare bikes or guides. Instead, we
use Google maps and take the most scenic routes to arrive at our
hotels each night.
3. Our bags will be relayed by couriers so you can ride light. Yes, we
will have inner tubes and other basic spare parts.
4. Terrie is a slow poke, so while we will indeed be covering
80km-100km a day, it will take 6+ hours each day, with plenty of time
for lunch, photos, drinks, etc.
5. No hill climbing! Terrie is allergic to tall mountains.
6. Although the rides will run 5-6 days, people wanting to cut out at
3 days will be able to do so.
7. Our bikes will go with us on the Shinkansen. Terrie can show you
how to prepare and break your's down for simple transport.
8. If you don't have a road bike, you can rent one at
https://www.gsastuto.com/. [Excellent supplier, great prices.]
9. Anyone over 16, any gender, welcome.
10. There will be a JPY20,000 organizing fee per rider.
11. Other costs will all be at cost. Usually this works out to about
JPY13,000/day plus Shinkansen tickets.

If you're interested in a long, slow, fun, potluck cycling tour in
Japan, contact Terrie today and he will work with you and the rest of
the group to set the final dates and routes.

For more information, email: terrie.lloyd@japantravel.com
-----------------------------------------------------------

[...Article continues]

For example, one of the biggest importers of primary produce from
Japan is Hong Kong. It's 7.5m people consumed about JPY50bn worth of
seafood exported from Japan in 2013 (most recent data we could find),
second only after China as a source for product. Of this JPY50bn in
sales, none is from Fukushima, because all marine produce from
Fukushima is banned from import into the Territory due to radiation
fears. The producers in Fukushima have been working mightily to
overcome these concerns by checking radiation levels to a degree that
no other country does, and for three straight years, levels were well
below international limits (the max reading from 6,000 samples
annually was 50 becquerels per kilo, versus the government max
allowable level of 100 becquerels per kilo), and so it seemed that the
marine environment along Fukushima's coastline was recovering. Then,
like a bolt from the blue and certainly a reminder just how little
control TEPCO has over contamination leakage, a skate fish was caught
in January this year that measured 161 becquerels per kilo. Thus, it
is highly unlikely that HK or Taiwan, or any of the other 6 countries
and regions still banning Fukushima marine products, will relax this
ban any time soon. Furthermore, it is also unlikely that urban
housewives in Tokyo will want to buy Fukushima marine products for the
rest of this year either.

Then there is the weird and impenetrable accounting of the
prefecture's financial performance. According to the government, the
Tohoku Gross Regional Product (GRP) in 2013 was JPY32trn, up 3.3% from
the year before, and so one can assume that the impact of the
earthquake wasn't that bad. Indeed, the government stats unit offers a
note saying the GRP increased "...mainly due to demand driven by
reconstruction." What's concerning, though, given that a lot of the
Tohoku reconstruction funding will end in 2021, is that if you deduct
the spending on reconstruction, which for Fukushima Prefecture alone
over the last 6 years has been JPY32trn, you can roughly calculate
that by dividing the Tohoku GRP by 3, Fukushima GDP is actually down
by about JPY1trn annually over its pre-earthquake performance. We
don't understand why this economic impact isn't being built into the
JCER/METI estimates. OK, if it's being too harsh blaming all of this
fall on the Daiichi power plant, then what about just lopping off the
losses for tourism?

http://bit.ly/2VMZR4d [Reconstruction costs for Fukushima, as of 2017]

Thanks to an awesome introduction from the Safecast.org folks, several
of us visited the Fukushima Daiichi plant locale, gaining access to
the exclusion zone back in February. To get there, we first had to
travel through the previously excluded zones, such as Odaka, the town
immediately to the north of the power plant, but which escaped the
worst of the fall out in the days immediately following the explosion.
We visited locals and discussed the economic situation with them and
each place we visited, the story was the same. The young people have
left the area with their children and have put down roots in other
parts of the country. Thus, in places like Odaka, a "young" person is
now someone in their 60's, and the few shops and services that have
re-opened are supplied by people of these ages.

The population of the area has plummeted from around 30,000 prior to
the explosions to around 2,000 people now. To be sure there are some
valiant attempts to breathe life back into the area. Just last week
the Economist ran a story about an evacuee who returned to Odaka and
recently opened up a surf shop there. He states in the article that
Odaka has arguably the best waves in Japan (if you stand on the coast
near the Fukushima power plant, the wave breaks are actually amazing)
and that if not for the melt down at the plant, Odaka would surely
have been chosen for the surfing competition for the Tokyo Olympics.
Yet another economic loss among many, for the area that isn't in the
JCER/METI calculations.

The current exclusion area is an ellipse of about 10km x 20km that
embodies the wind drift on the day of the reactor housing explosions,
and although you can drive right through on Route 6 (opened up several
years ago), each byroad is blocked by police and access is restricted
to locals and pass holders only. We did in fact score a couple of
passes and were guided to a look out right opposite the plant, where
an old folks home used to be. Getting so close, you get a clear
impression of just how vast the tank farm is, and how much more it is
going to cost to deal with another 35-200 years of contaminated water.

In Japan, according to IEEJ, the rough cost of producing power by
nuclear is around JPY6 per kilowatt hour, while the cost of oil-fired
electricity is about JPY9 per kilowatt hour (LNG is apparently only
JPY4 but conversions are needed to run the new fuel), wind is JPY10,
and solar is about JPY30. Japan consumes about 858 Terawatt (TW) hours
of electricity annually, meaning that it is costing the country an
extra JPY700bn (about US$6.2bn) to not be using nuclear and using oil
instead. In fact, LNG is half the price of nuclear, so the case could
be made to simply switch all nuclear to LNG to save money. Comparing
this against the clean up, Japan could use imported oil for another
20+ years and still be cheaper than having another nuclear power
station accident of this magnitude, while using LNG would be a
permanently cheaper solution. So this is really the true cost of using
nuclear in such a geologically unstable country as Japan.

Also not included in the JCER or METI calculations is the health
impact on the local population. Much has been made of the fact that
there has been little increase in cancer deaths and therefore the
impact on physical health appears to have been minimal. In terms of
psychological health on the other hand, the mere thought of the
Daiichi power plant and possible radiation contamination still induces
fear in a prefectural population of 1,862,705 This fear has been
strong enough to drive 115,458 people, about 6% of the population, to
leave the prefecture permanently. Also, while cancer deaths have been
downplayed, we had a personal reminder that even at 14.5uSv
(microseiverts) per hour which we experienced within the restricted
zone (500m from the plant) is still not healthy. One of us, with a
previously healed skin cancer wound on the wrist coincidentally
experienced a suddenly red swelling and itching of that same skin area
that lasted for a week before subsiding after return to Tokyo. Maybe
just a coincidence, but then again, maybe not - and we were only in
the restricted zone for a couple of hours.

...The information janitors/

***------------------------****-------------------------***

------ German-speaking Travel Consultant Internship -------

Japan Travel KK (www.japantravel.com) is experiencing strong growth of
its German desk for inbound travelers to Japan, and we are looking for
a German-English speaking intern to join the team, with a view of
transitioning to a full-time position and work visa in Japan. The
internship will be for a minimum 3 months and a maximum of 6 months,
after which there will be a management and peer review. You can be
either a student who needs to do an internship to meet academic course
requirements, or you can be a person in the workforce thinking to
reset your life and location. Apart from German you should be able to
speak basic English and/or Japanese (either is OK).

The type of work you'll be doing is assisting German customers wanting
to plan trips to Japan. This would include the following:
* Responding to incoming leads and conversing (usually email/chat)
with customers
* Researching accommodation, transport, activities, diet
preferences/availability, entertainment, guides, and other things that
travelers require
* Using our quotation and itinerary systems to produce the customer materials
* Interacting with customers and consulting them on choices and areas of concern
* Translation of content about destinations
* Writing original content (articles) about destinations and activities
* Assisting us with German social media

For more details: jerome.lee@japantravel.com
-----------------------------------------------------------

***------------------------****-------------------------***

+++ NEWS

- Size of freelance market in Japan is surprising
- Chinese government crackdown on luxury goods hurts sales in Japan
- Facial recognition at pachinko parlors?
- U.S. to quintuple bases charges to Japan?
- Fukushima produce still feared abroad

=> Size of freelance market in Japan is surprising

Some interesting stats coming out of one of Japan's two largest
freelancer marketplaces recently. According to Lancers' here are over
1m freelancer workers in the country, up 5% on 2017, and that a
further 20m people are doing freelance or moonlighting work.
Officially, the number of people who pay tax on a second job is about
7m people, around 11% of the workforce. This compares to about 20% of
the U.S. workforce having second jobs. ***Ed: This pretty much points
to the fact that while Japanese companies are restricting salary
increases for their staff, enterprising (or desperate) employees are
making up for it by leaving the office early so they can check in to
their after hours jobs.** (Source: TT commentary from forbes.com, Mar
09, 2019)

http://bit.ly/2SVtVZB

=> Chinese government crackdown on luxury goods hurts sales in Japan

Chinese New Year is usually a peak selling period for Japanese
department stores targeting Chinese tourists looking to fill their
suitcases for friends and family back home - but not this year.
Instead, spending per shopper fell 8.4% to JPY63,000 as Chinese
customs authorities started cracking down on luxury spending abroad.
In particular, the border authorities are checking the bags of regular
travelers who don't have a visible means of income matching declared
goods. These shop-and-carry freelance agents for consumers back home
are known as "Daigou" and account for a large portion of luxury
imports made by Chinese travelers returning home. It's estimated that
there are up to 200,000 amateur Daigou resident in Japan (i.e., most
of the students studying here). Worldwide the Chinese spend about
US$294bn while traveling, about 33% of overall tourist shopping.
(Source: TT commentary from asia.nikkei.com, Mar 09, 2019)

https://s.nikkei.com/2F1uduu

=> Facial recognition at pachinko parlors?

Although it won't be law (yet) the government is going to request
horse racing, boat and bicycle racing, and pachinko operators to
install facial recognition systems at their entry points, to detect
gambling addicts and restrict admission to them. The facial
recognition systems would be connected to a central database that sets
a maximum that a person can spend at each outing. In addition, the new
guidelines will remove ATMs from gambling sites and require operators
to modify their advertising messaging, so as to not encourage addicts.
***Ed: Sounds like it could be a good system, but apart from the Japan
Racing Association (JRA), which governs horse racing and which is
concerned about public image, we doubt that most pachinko parlor
operators are going to do more than pay lip service to this. The LDP's
coalition partner needs to push the government harder to pass a law
with teeth if they really want to curb gambling addiction.** (Source:
TT commentary from japantimes.co.jp, Mar 08, 2019)

http://bit.ly/2EQZ4bF

=> U.S. to quintuple bases charges to Japan?

The Trump government has come up with a new way to extract cash from
its allies, in the form of charging more for maintaining armed forces
in Japan, South Korea, and Germany. The new charge rate is dubbed
"Cost Plus 50", and will require each host country to cover the full
cost of maintaining U.S. troops in their jurisdiction PLUS a 50%
premium for the privilege. Apparently the idea is mostly Trump's, who
brought it up at South Korea on his visit there. His staff have tried
to tamp down the idea which apparently sent “shock waves through the
departments of Defense and State.” ***Ed: While it is true that Japan
and other countries receive significant confidence from the armed
presence that the U.S. provides, if faced with an extra JPY2trn in
fees it's likely the Japanese (and other countries) may simply ask the
U.S. to reduce its presence. Rather than boots on the ground anyway,
what the Japanese really want is the nuclear umbrella. If the U.S.
pushes too hard it risks encouraging Japan to step up its own
rearmament, as well as removing an "unsinkable air craft carrier"
forward base. The same situation applies to Germany, whose Ramstein
air force base serves a critically strategic role in the Middle
Eastern and East European theaters.** (Source: TT commentary from
stripes.com, Mar 08, 2019)

http://bit.ly/2TFYXZY

=> Fukushima produce still feared abroad

Although the government and primary produce authorities have had a
thorough food quality checking process in place for years now, the
mere name of Fukushima as the prefecture the products are sourced from
prevents food exports to China, Hong Kong, the United States, Taiwan
and South Korea and 3 other countries/regions. In particular the
restrictions to distribution to Hong Kong hurt, as the territory is
otherwise the largest importer of Japanese primary produce - paying
top dollar for what it regards as Japanese quality. While the number
of countries banning Fukushima produce is well down from the peak of
54 countries following the Daichi power plant disaster, the image that
Fukushima is stuck with of being an irradiated danger zone still
persists. In a recent consumer perception survey a full 77% of Chinese
respondents “actively avoided” food from Japan, 54% did so from
Taiwan, 29% from the U.S. and 26% from the U.K. ***Ed: Of course it
has to be said that this is not a foreign phenomenon. Most people we
know still actively avoid anything grown in Fukushima, even though
it's pretty clear that most if not all produce passing inspection is
now safe to eat. We don't see this situation changing for at least a
generation. Yet another cost caused by the Fukushima disaster.**
(Source: TT commentary from the-japan-news.com, Mar 10, 2019)

http://bit.ly/2IZTHMv

NOTE: Broken links
Some online news sources remove their articles after just a few days
of posting them, thus breaking our links -- we apologize for the
inconvenience.

***------------------------****-------------------------***

+++ UPCOMING EVENTS

No upcoming events this week.

***------------------------****-------------------------***

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-----------------------------------------------------------

***------------------------****-------------------------***

+++ CORRECTIONS/FEEDBACK

=> In Terrie's Take 982 we gave an update on vacation rentals and how
the government managed to kill a useful tourism sector. A reader in
the tourism real estate business writes about the hopelessness of
Kasumigaseki bureaucracy even in the remotest parts of the country.

**** Reader:

Thanks so much for your journalism and providing a viewpoint that the
the mass media doesn't give us. My business experience in Japan has
been good mainly because of my real estate investments. However, my
Number One reason for lack of expansion and general frustration has
always been the government's restrictive regulation or apathy towards
any new ideas. They have one standard answer to any request out of the
ordinary, which is "NO" or on a slightly more subtle level, "It's not
our department." Even for stuff that isn't out of the ordinary,
finding a government office that will take responsibility is almost
impossible.

Here are a couple of examples from my local area of Niseko, Hokkaido.
Approval of a adventure-based tree tops rope course I had planned at a
nearby forest was withheld 14 years ago for no particular reason.
Then, as soon as another adventure company working closely with Tokyu
Resort, a massive real estate developer, applied, their project was
approved in record time - in the same area that I applied for, no
less...!

Perhaps of more importance to the community is the problem Niseko
visitors have getting taxis. Every winter there is a shortage, and as
a result holiday makers have to rent a car, which they naturally park
on the side of the road most of the time, blocking traffic around
hotels and short-term rental properties. It would make SO much more
sense if Uber or Grab were allowed to operate here.

Lastly, it's getting extremely difficult for property owners in Niseko
to recruit local staff and/or to sponsor in foreign skilled staff -
especially operations managers. As a result, I have seen so many local
businesses either give up their growth plans or in some cases simply
give up on opening in Niseko in the first place. Given that most of
the customers here are non-Japanese, how does this restrictiveness
help Japan in any way?

***------------------------****-------------------------***

+++ TRAVEL DESTINATIONS PICKS

=> Shirakane Ishigura Museum, Kagoshima
Exploring a shochu distillery

There are few places better to taste and learn about shochu (the
Japanese alcohol typically made from rice, barley, sweet potatoes,
buckwheat or brown sugar) than Kagoshima. In the southern part of
Kyushu, the sweet potato is the base ingredient of choice and there
are hundreds of distillers offering tours, tastings, and varieties for
sale.

In Aira, near Kagoshima Airport, Shirakane Shuzou Co., Ltd. has been
distilling shochu at its family ishigura (stone storage house) since
1869. Steeped in history, the ishigura was declared a tangible
cultural property in 2001 and today is the site of a museum offering
opportunities to experience shochu culture firsthand.

For residents of Kagoshima, shochu is an iconic local specialty
product, and the museum’s engaging exhibits explain why. A series of
displays, artifacts and models show the prefecture’s history of sweet
potato imports and how this led to the practice of making and drinking
shochu. It also details Shirakane Ishigura’s traditional manufacturing
process.

But the ishigura itself is not only famous for its shochu. It was also
the resting place for local samurai who revolted against the imperial
government in the Satsuma Rebellion of 1877. Their leader, Saigo
Takamori, bought shochu from Shirakane Shuzou Co., Ltd. to energize
his soldiers and to use it as antiseptic for the wounded.

http://bit.ly/2XLfBGZ

=> Monkey Park Iwatayama in Kyoto
Feed, walk with snow monkeys year round

"Don’t stare into the monkeys’ eyes." This is sound advice before
visiting Kyoto’s monkey park: a mountainside where I hiked among wild
monkeys, merely a visitor to their home. After hearing about Monkey
Park Iwatayama (sometimes it has an Arashiyama in the name), it was an
attraction I knew I had to see while in Kyoto in April. The park is
located in Arashiyama, one of Kyoto’s busiest tourist areas, and is
easily accessible by train. It boasts about 120 snow monkeys, which
are also called “Japanese macaque.” They are native to Japan, and,
yes, these are the type of monkeys seen in iconic photos bathing at
hot springs in winter.

While the monkeys are human-fed (even tourists have a chance to feed
them), they are still wild, the park assures. The “don’t stare” and
"don’t touch" warnings should be followed, though, I witnessed the
friendlier monkeys come just centimeters away from visitors.

http://bit.ly/2tZXXBm

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+++ ABOUT US

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