2011年3月14日 星期一
2011年3月13日 星期日
A perfect storm of man-made and natural disasters
5:00PM GMT 12 Mar 2011
The mountainous country lives on its coast so the position of the epicentre off the eastern seaboard could hardly have been worse.
Markets conducted their pitiless audit of the likely impact on Friday and will continue doing so tomorrow. Their calculation is roughly this: the most recent comparable disaster in Japan, the 1995 Kobe quake, incurred a heavy human and economic cost from which the important seaport has arguably never fully recovered. More than 6,000 perished in Kobe while the financial cost was estimated at around $100bn (£62bn).
With the affected area this time representing a relatively small share of Japanese output, the impact could be rather lower but it is too soon to tell with any certainty. Kobe was a major logistics hub so supply chains were seriously compromised.
In the short term, the impact on the Japanese economy will be negative, in part due to physical damage to infrastructure and capital stock and because of the psychological trauma suffered by the Japanese, which is likely to trigger risk aversion, a drop in consumer confidence and an increased urge to save.
Further out, the rebuilding effort will probably stimulate the economy via construction and other capital spending. The net impact on GDP might be positive, not least because the Bank of Japan quickly made it clear it will provide whatever liquidity is required. Fiscal policy is likely to ease.
With the earthquake striking so close to the end of the trading week in Tokyo, the full stock market impact will not become apparent until Monday morning. The 1.7pc fall in the Nikkei on Friday was as much a knock-on from Thursday's poor showing on Wall Street as a reaction to the unfolding disaster.
The stock market impact of Kobe was prolonged, with the Japanese market underperforming the S&P 500 for many weeks. In part this was a response to the rapid appreciation of the yen as overseas investments held by Japanese investors were repatriated.
Foreign assets tend to be liquidated first when there is an urgent demand for capital, and in the weeks following the Kobe quake insurance companies sold off US Treasury bonds – their most liquid holdings – in order to meet a surge in claims by their Japanese customers.
This time around, the currency market response was initially to sell off the yen as hot money flowed out of Japan, but this was almost immediately reversed and it is likely the Japanese currency will remain underpinned by international flows for some time to come. This will be a negative for the export-reliant stock market.
The insurance sector was unsurprisingly in the spotlight on Friday. The reinsurers are quite heavily exposed to a Japanese earthquake and they have experienced a busy year already for natural catastrophes, so further losses could hit their balance sheets hard. What is not yet clear is whether the price tag is heavy enough to trigger higher premiums during the renewal season, which starts in April.
It is difficult to generalise from previous natural disasters about what the longer-term market and economic impact will be. Hurricane Katrina cost $45bn and is estimated to have taken 1pc off US GDP, but its market impact was minimal. In New Zealand, the Christchurch quake has already led to a half-point cut in interest rates to an all-time low. Australia's floods had little immediate impact but a $1.8bn tax hike to fund reconstruction was taken badly by investors.
Friday's quake came at a bad time for global markets. Already, the two-year anniversary of the bottom of the bear market in March 2009 had turned into a damp squib. Last week was characterised by an intensification of the turmoil in North Africa and the Middle East, concerns over Chinese inflation and the re-emergence of the eurozone as a serious concern following the downgrade of the sovereign debt of both Spain and Greece.
The key question for investors is the extent to which the global economic recovery could be derailed by this perfect storm of man-made and natural disasters. The answer is probably less than you might think, transfixed as we are by TV footage of a tidal wave sweeping across defenceless rice fields.
Tom Stevenson is an investment director at Fidelity International. The views expressed are his own.
Nuclear safety worries spread to Europe
Tens of thousands of people have taken part in an anti-nuclear demonstration in southern Germany. The demonstration had been planned for some time, but after the news of Japan's nuclear emergency, organisers were overwhelmed by crowds of around 50,000 people who turned up.
The demonstrators, who stretched in a 45km chain from Neckarwestheim power plant to the city of Stuttgart, were demanding that the German government move away from nuclear power.
Chancellor Angela Merkel, who has extended the lifespan of Germany's nuclear power plants, summoned senior cabinet ministers to an emergency meeting.
The Japanese radiation leak comes at a difficult time for Merkel, whose conservatives face three state elections in March where worries over nuclear safety could rally her opponents. The opposition Social Democrats and Greens have called for change and claim several German nuclear plants could not withstand a direct hit by an aircraft or an earthquake.
"We cannot master nature, nature rules us," said Renate Kuenast, the Greens' parliamentary leader.
The government's decision last year to keep Germany's 17 nuclear plants running for about 12 years beyond their original shutdown date has weighed on the popularity of Merkel's coalition.
In Italy a senior government politician said the earthquake would not change plans to move ahead with a new nuclear power scheme.
Italy is the only G8 industrialised nation that does not produce nuclear power, but prime minister Silvio Berlusconi wants to generate a quarter of the country's electricity from nuclear in the future.
Italy is also at high risk of suffering natural disasters, mainly due to earthquakes. "The position remains what it is, you can't keep changing it," Fabrizio Cicchitto, leader of Berlusconi's PDL party in the lower house told reporters. "It's not just recently that we have energy problems," he said.
In the UK the energy secretary Chris Huhne said the government was monitoring the nuclear situation in Japan. "It's too early to say what the cause was, let alone what the implications are. We are working extremely closely with the IAEA to establish what has happened. Safety is the number one priority for the nuclear industry."
Privately, many in government and the private energy sector in the UK are worried that the raising of the spectre of nuclear disaster will have implications for the coalition's huge building programme for ten new power stations to replace the UK's ageing reactors.
The accident in Japan comes days after the Navy admitted the reactors on British submarines are 'significantly below benchmarked good practice', and weeks before the 25th anniversary of the Chernobyl disaster, which will push fears over nuclear safety back to the forefront of the minds of the British public.
Jan Beranek, head of Greenpeace International Nuclear Campaign, asked for the construction project to be scrapped in the wake of the Japanese earthquake. "Governments should invest in renewable energy resources that are not only environmentally sound but also affordable and reliable," he said.
2011年3月12日 星期六
Japan struggles with nuclear reactors in wake of quake
March 12, 2011 -- Updated 2146 GMT (0546 HKT)
Tokyo (CNN) -- Crews at a nuclear plant struck by an earthquake, then a tsunami and then an explosion in the span of 36 hours resorted Saturday to flooding a feverish nuclear reactor with sea water in hopes of preventing a meltdown of its core.
An explosion that sent white smoke rising above the Fukushima Daiichi plant Saturday afternoon buckled the walls of a concrete building that surrounded one of the plant's nuclear reactors, but did not damage the reactor itself, Chief Cabinet Secretary Yukio Edano told reporters.
The explosion was caused, he said, by a failure in a pumping system as workers tried to prevent the reactor's temperature from racing out of control.
The International Atomic Energy Agency, citing Japanese authorities, said the explosion occurred outside the plant's primary containment vessel and that the vessel remained intact. The explosion injured four workers, it said.
To limit damage to the reactor core, Tokyo Electric Power Company began injecting sea water mixed with boron into the primary containment vessel in an operation that got under way Saturday night, IAEA said.
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The use of sea water and boron was described as a "Hail Mary pass" by Robert Alvarez, senior scholar at the Institute for Policy Studies focused on energy policies and a former senior policy adviser to the U.S. secretary of energy.
"My understanding is that the situation has become desperate enough that they apparently don't have the capability to deliver fresh water or plain water to cool the reactor and stabilize it and now, in an act of desperation, are having to resort to diverting and using sea water," he said.
Boron, a chemical element, was being added to the water "to sort of stymie other potential nuclear reactions," he said.
But, he acknowledged to reporters in a conference call, "There's a lot that we don't know about what's happening with these reactors. It's trying to piece together a picture where you're dealing with just a few pieces of the puzzle."
Another expert said enough was known to conclude that Saturday's nuclear events in Japan rank high on the list of similar incidents. "If this accident stops right now it will already be one of the three worst accidents we have ever had at a nuclear power plant in the history of nuclear power," said Joseph Cirincione, an expert on nuclear materials and president of the U.S.-based Ploughshares Fund, a firm involved in security and peace funding.
He said only the 1979 partial meltdown of a reactor core at the Three Mile Island nuclear plant in Pennsylvania and the 1986 Chernobyl disaster in the Soviet Union were worse.
If the effort to cool the nuclear fuel inside the reactor fails completely -- a scenario experts who have spoken to CNN say is unlikely -- the resulting release of radiation could cause enormous damage to the plant or release radiation into the atmosphere or water. That could lead to widespread cancer and other health problems, experts say.
Japan's Nuclear and Industrial Safety Agency (NISA) was dribbling out information slower than some experts wanted: it said Saturday that it detected cesium-137 and other isotopes near Unit 1 early in the day. Cesium is a byproduct of the nuclear fission process that occurs in nuclear plants.
While Cabinet Secretary Edano said later in the day that radiation levels appeared to be falling, the government nevertheless ordered an evacuation of residents within a 20-kilometer radius of the Daiichi plant, as well as a second facility where the cooling system had failed -- the Fukushima Daini plant.
An estimated 170,000 people have been evacuated, though the process was ongoing, the International Atomic Energy Agency said Saturday.
Japanese authorities have classified the event at Fukushima Daiichi Unit 1 as a level 4 "accident with local consequences" on the International Nuclear and Radiological Event Scale intended to communicate to the public the significance of radiation-linked events. The scale runs from 0 to 7, with the latter being classified as a major accident.
On Saturday night, three patients at a hospital tested positive for radiation exposure, according to the Japanese public broadcasting station NHK, citing a statement from Fukushima Prefecture.
The three were randomly selected from a group of 90 hospital workers and patients who were outside the hospital -- about three kilometers from the Daiichi plant -- awaiting evacuation at the time of the explosion. The patients had already been hospitalized at the medical facility prior to Friday's quake.
While the three showed signed of exposure, "no abnormal health conditions have been observed," NHK quoted the prefecture as saying.
Meanwhile, two experts from the U.S. Nuclear Regulatory Commission with expertise in boiling-water nuclear reactors like those affected by the disaster have been sent to Japan as part of a U.S. Agency for International Development (USAID) team.
The NRC's Maryland-based headquarters operations center has been operating around the clock since the beginning of the emergency.
Japanese authorities, meanwhile, appeared to be preparing for the possibility of a nuclear release. Japan public broadcaster NHK reported the country's defense ministry had sent a unit that specializes in dealing with radioactive contamination to a command post near one of the stricken plants.
The government was also preparing to distribute iodine tablets to residents, the IAEA said. Iodine is commonly prescribed to help prevent the thyroid gland from taking in too much radioactivity, according to the U.S. Environmental Protection Agency website.
In all, the earthquake prompted the automatic shutdown of 10 reactors at three nuclear plants near the quake site, Japan's nuclear agency said. Problems have been reported at all three plants, although the fire reported Friday at the Onagawa nuclear plant was quickly extinguished and it has not been a focus of concern since.
At the Fukushima Daini plant, problems had been detected with the pressure and cooling systems at three of the four reactors that shut down, but plant owner Tokyo Electric Power Company reported all of the reactors were stable Saturday.
Japan's nuclear agency said there is a strong possibility that the radioactive cesium the monitors detected was from the melting of a fuel rod at the plant, adding that engineers were cooling the fuel rods by pumping water around them.
A spokesman for the agency said atomic material had seeped out of one of the five nuclear reactors at the Daiichi plant, located about 160 miles (260 kilometers) north of Tokyo.
The problems at the Daiichi plant began Friday when the 8.9-magnitude quake struck off the eastern shore of Miyagi Prefecture. The quake forced the automatic shutdown of the plant's nuclear reactors and knocked out the main cooling system, according to the country's nuclear agency.
A tsunami resulting from the quake then washed over the site, knocking out backup generators that pumped water into the reactor containment unit to keep the nuclear fuel cool, according to the agency.
As pressure and temperatures rose inside the reactors at the Daiichi and Daini plants, authorities ordered the release of valves at the plants -- a move that experts said was likely done to release growing pressure inside as high temperatures caused water to boil and produce excess steam.
As crews were working to pump additional water into the reactor containment unit to lower the temperature, the pumping system failed, Edano said, causing an explosion that injured four workers and brought down the walls of the building containing the reactor.
The team then reverted to a plan to flood the reactor with sea water, which Edano said would lower the temperature to acceptable levels. That work began Saturday night and was expected to take two days, Edano said.
Before Edano's announcement, Malcolm Grimston, associate fellow for energy, environment and development at London's Chatham House, said the explosion indicated that "it's clearly a serious situation, but that in itself does not necessarily mean major (nuclear) contamination."
"This is a situation that has the potential for a nuclear catastrophe. It's basically a race against time, because what has happened is that plant operators have not been able to cool down the core of at least two reactors," said Robert Alvarez, a senior scholar at the Institute for Policy Studies in Washington.
If damage from the explosions or aftershocks have compromised the structural integrity of the reactor complex, it could make efforts to cool the reactors more difficult, Cirincione said.
"The big unanswered question here is whether there's structural damage to this facility now," he said.
Japan's nuclear path
Can nuclear power save Japan from peak oil?
If the recent proclamations from various bodies, including the International Energy Agency, about our close proximity to the peak in world oil production are true, then Japan may be sitting on the equivalent of an energy security time bomb.
The greatest concern is that this time bomb could explode as early as 2015, and with a high probability before 2020 when a global oil crunch has been predicted by Chatham House (the UK’s Royal Institute of International Affairs), by the UK Industry Taskforce on Peak Oil and Energy Security (a group of businesses, including Virgin Airlines, Ove Arup and Partners, etc.) and by the Energy Research Centre, amongst others.
The reason for this concern is simple — Japan’s self-sufficiency in primary energy stands at 18%, including nuclear. This compares with an average 70% energy self-sufficiency across OECD countries.
One issue here is Japan’s high dependency on oil. A paper just published by Andrew DeWit and Iida Tetsunari points out that:
“Japan relies on oil for 44% of its primary energy. It also gets over 90% of its oil from the unstable Middle East.”
It costs Japan around ¥16.6 trillion (around US$200 billion) each year to pay for these oil imports. Basically, this represents a quarter of all Japanese annual expenditure on imports.
It is both an expensive and vulnerable position to be in. What if the supply of oil was suddenly cut-off? This is a reality that Japanese leaders and bureaucrats are well aware of. The 2010 Annual Report on Energy by the Ministry of Economy Trade and Industry (METI) makes specific reference to “choke points” that obstruct the flow of oil from the Middle East and other oil producing regions.
A choke point is a strategic location on a sea route (e.g., the Malacca Straits) that could easily be blocked to prevent the flow of shipping in a time of geopolitical turmoil.
 | With respect to alternatives, as in some countries like Germany and Sweden, there is considerable potential for the development of more renewable energy in Japan if the suitable conditions are in place. |
Power generator in Yokohama city. Photo by Ykanazawa1999.
It is possible to calculate something called a “choke point ratio”. A ratio of 100 means that 100% of the oil reaching a country passes through such points. When it exceeds 100, this means that the oil passes through multiple choke points. Japan’s choke point ratio is 171, while those for Germany and the United Kingdom are around 5 and 3 respectively.
Countries tend to respond to concerns about supply vulnerability by stockpiling oil. Japan maintains stockpiles for 129 days. So in the advent of a major disruption to oil supplies, Japan would be able to carry on for around five months under business-as-usual scenarios (perhaps longer if only vital services are maintained). That is a rather thin safety cushion to rely on, and the question here is how is Japan dealing with its energy security vulnerabilities in the short term and long term?
How to increase energy security?
The last time we spoke to officials from METI back in 2009, it appeared that the direction of Japan’s future energy policy was in flux and renewable energy (particularly solar) was gaining increased support, especially through the country’s stimulus packages.
In the intervening period a great deal appears to have changed. These changes are explained by DeWit and Iida who argue that the nuclear lobby has reasserted its influence over the Japanese political and bureaucratic elite and that now nuclear power is seen as “the only realistic option for reducing dependence on fossil fuels and cutting [greenhouse gas] emissions” and as a “major export business”.
The Strategic Energy Plan of Japan, published by METI in June 2010, sets forth the goal of constructing nine new nuclear power plants by 2020 and more than 14 by 2030.
The plan envisions a significant reduction in the overall energy consumed by Japan in 2030 through efficiency measures, as shown in the figure, with nuclear power growing from 10% of primary energy today to 24% in 2030. The share of renewables is also predicted to grow from 6 to 13%.
There are a lot of assumptions underpinning these proposals. First, although the Japanese population is predicted to decline, the number of households is expected to increase slightly, reflecting changing lifestyles and family structures. As a result, greater energy efficiencies are required in the residential sector that would also have the benefit of reducing CO2 emissions. The plan envisions something like a revolution in the efficiency of household electrical appliances.
Also in the plan, nuclear and renewable energy are both described as zero emission power sources, although some may contest whether from a life-cycle perspective either are totally carbon dioxide emissions free.
Japan currently sits at number three in the world, behind France and the United States, in terms of the amount of energy generated from nuclear sources. The direction presented in the latest Strategic Energy Plan is essentially taking France as the model, since like Japan, it is a country that lacks domestic fossil energy resources (except coal).
Japan’s 2010 Energy White Paper makes specific reference to key advantages of the French model: powerful energy supply businesses, such as EDF and TOTAL, a monopolistic energy sector, and vertically integrated national and public companies.
This closely reflects the situation in Japan where ten electrical utilities maintain regionally-based monopolies and, according to DeWit and Iida, these companies “want to protect that dominance against competitors and energy alternatives that might threaten their plans to expand nuclear power.”
Moving in the wrong direction?
In many respects, it may possible to argue that, with respect to the future of energy in Japan, nuclear may be the wrong direction. This is not to argue against the merits of nuclear power per se, but to express concern of the emphasis placed on nuclear above other options, including renewables. This approach runs counter to experience in countries like Sweden and Germany, and also to the findings of recent research that shows that we could power the world on alternative energy technologies within 20–40 years. So why not Japan?
Clearly, from an historical perspective, nuclear makes considerable sense taking into account Japan’s lack of domestic fossil fuel options and also bearing in mind the considerable industrial expertise that Japan has developed in this sector. Nuclear for Japan represents the “business as usual” option. It ensures a coordinated, centralized, monopolized energy system that can guarantee the maintenance of a high technology industrial system. Nuclear seems to make sense if you want to maintain huge urban agglomerations like Tokyo (which has 1% energy self-sufficiency).
If you conclude that the future will be the same as the past then nuclear seems like the right choice. But when you also think about the less urbanized areas of Japan, nuclear is much less attractive.
Certainly the best and the brightest in Japan’s bureaucratic elite would say, “Yes, categorically, nuclear is the way to go”. But the problem here is the lack of independent think tanks inputting into policy (i.e., those not directly set up by, or related to the government) which means that the energy policy process in Japan is not open to the consideration of alternatives and that could also explain why peak oil is yet to enter the policy debate.
The other big challenge related to nuclear is the issue of safety and risk, especially in an earthquake prone country like Japan and particularly in relation to how radioactive waste is dealt with, as we touched on in Monday’s article.
With respect to alternatives, as in some countries like Germany and Sweden, there is considerable potential for the development of more renewable energy in Japan if the suitable conditions are in place.
For instance, the first Renewable Energy White Paper published in 2010 by a group of independent Japanese think tanks argued that it would be possible to meet 67% of domestic energy demand in Japan by 2050. This view has been largely ignored by Japanese energy policy-makers at the national level.
That estimate may be optimistic and some may argue that renewable energy also has very significant limitations. Nevertheless, a major expansion of renewable energy in Japan could help reduce energy insecurity by diversifying supply and decentralizing power generation. This would give local communities more say on how they generate their electricity and allow them to innovate in the process. This approach would represent a radical and visionary change in how the energy sector works in Japan; if history is any guide, such a transition does not yet seem palatable for those who decide how the country will invest in its energy infrastructure.
From a peak oil perspective, some commentators, such as Rob Hopkins and John Rawlins, are concerned that nuclear may not be the right way forward. They are worried about the availability of uranium, suspecting that future scarcities and suggesting that nuclear is a “stop-gap” solution rather than something that can be sustained long into the future.
Another concern would be how nuclear may fare in a world where energy supplies as a whole are declining. According to Hopkins:
“Nuclear power has always been predicated on the concept that future generations will be more capable than we are to deal with nuclear waste. The logic runs that they will, by that time, have cracked how to make it safe, and so therefore it is fine to leave it as some kind of intellectual puzzle for them to figure out.”
Solving something as complex as how to process nuclear waste is an energy intensive industry and this increases the vulnerability of the energy sector in an energy scarce scenario. Hopkins is concerned that:
“Future generations will not have the dubious luxury of being profligate with fossil fuels as we have been.”
An important point to make here is that the planning, construction and implementation of nuclear power plants take decades. So Japan, and every other country, may be facing a race against time, where the rate of oil depletion after the peak will be a significant factor in determining how rapidly we need to find alternatives to oil.
Pushing nuclear does mean that Japan would require less oil for energy, which then could be utilized in the transportation sector, for instance. But here too is another race against time. The 2010 Strategic Energy Plan aims to increase the number of next generation cars (hybrids and electric) from 10% today to 70% of new cars sold by 2030. This still suggests a very large proportion of cars in Japan in 2030 will be gasoline powered. Ideally, in order to avoid major disruptions almost 100% of cars would be electric by 2030, but that is just not going to happen under the current policy framework.
So it may be safe to conclude that by pushing so aggressively down the nuclear path, Japan may be putting too many eggs in one basket. The rationale behind this approach is easy to understand since business as usual is easier than radical reform, and maintaining monolithic centralized structures is easier than decentralised ones in which less control by Tokyo and other urban centres would be a given.
However, let’s give the people behind the strategic energy plan the benefit of the doubt for just a moment. The plan is required to be reviewed every three years and revised if needed. So we have to wait until 2013 before the next review and by that time we all may have greater awareness about the state of our collective energy predicament.
For now, the central question remains open: will nuclear power actually save Japan from the worst effects of a peaking oil production? What do you think?
2011年3月10日 星期四
German export destinations: China overtaking the US
For the first time ever, German companies are shipping more vehicles, machines and electric goods to China than the U.S.
Latest trade figures showed China, including Hong Kong, accounted for 6.6 percent of Germany's export total in December 2010, compared to 6.5 percent to the U.S.
This marks a turning point to Germany's export structure after the collapse of Lehman Brothers in September 2008.
Latest trade figures showed China, including Hong Kong, accounted for 6.6 percent of Germany's export total in December 2010, compared to 6.5 percent to the U.S.
This marks a turning point to Germany's export structure after the collapse of Lehman Brothers in September 2008.
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