Post-Earthquake Reconstruction and Business

１．Current situation at disaster areas

Tohoku region disaster areas have not yet reached the stage where reconstruction efforts can be started. Manpower is no longer being devoted to rescue efforts; however it is extremely difficult to secure food and water for disaster victims living in shelters and private housing.
A characteristic of this disaster is the significant lack of food at shelters. The tsunami has disrupted traffic, preventing necessary supplies from reaching disaster sites and inconveniencing a large number of victims. Moreover, there is a shortage of fuel, so there is no heating and people are forced to withstand the cold by wrapping in blankets.

There are even elderly disaster victims that are suffering health problems due to the lack of privacy associated with their prolonged stay at the shelters. There are apparently even babies that have starved to death at shelters due to the lack of food. Improvement is urgently needed and while railway and roads are slowly beginning to reopen and helicopters are assisting with transport, it is still not enough.
The situation is far the point where it will be possible to transfer everything that is needed to the region. It is not yet possible to allot efforts to reconstructing the cities, as life support measures for victims that require emergency response are still not being provided to a sufficient degree.

２．The future of reconstruction in disaster areas

Looking at damage done to housing alone, at the time of the Great Hanshin-Awaji Earthquake that devastated the Hanshin district 16 years ago in 1995, while 100,000 buildings were completely destroyed and 140,000 half-destroyed, 160,000 new houses were constructed by 1998, just three years later^※4 .This shows us that nearly half of all houses were rebuilt anew-including those that were half-destroyed in addition to those that were completely destroyed. A precise number of damaged houses has yet to be announced for the Tohoku-Pacific Ocean Earthquake, but the scale of damage is twice that of the Great Hanshin-Awaji Earthquake (9.9 trillion yen, about 120 billion dollars or 780 billion yuan).
Assuming that the number of new houses to be built will also be double, it is anticipated that over 300,000 new houses will be constructed. Of course, before these houses are constructed temporary housing will be built. On 28 March, the Japanese Government announced that it would be building 300,000 temporary houses over the following two months (April-May)^※5 .

However, there are some differences between the Great Hanshin-Awaji Earthquake and the Tohoku-Pacific Ocean Earthquake. For instance, in the current disaster situation radiation has leaked from the Daiichi Nuclear Power Plant of Tokyo Electric Power Company (TEPCO), causing a serious situation.
The current level of radiation is not enough to negatively impact human beings, but the psychological impact on citizens is immeasurable. This engenders vast changes in consumer buying behavior, thus influencing the economy. Further, TEPCO’s rolling power outages in urban areas have caused consumption in many highly-populated urban areas to flag, pushing Japanese consumers into a trend of voluntary restraint.

On the other hand, however, rehabilitation spawns potential. The biggest difference between the current disaster and the Great Hanshin-Awaji Earthquake is that during the 16 years since the earthquake people have become more sensitive to environmental problems, where today much awareness is paid to environmental friendliness in the construction of new housing.

The Japanese market is very attractive and it is forecasted that, as a result of the current disaster, the market will greatly open up to foreign companies. That means that Japan’s doors are now open to foreign manufacturers of solar batteries and other products.

At the disaster areas it will be necessary to rapidly construct over 300,000 new houses over a two to three-year period once reconstruction efforts commence, meaning that there will be an immediate need for massive amounts of resources. It is forecasted that this amount will be so large that Japanese manufacturers alone will not be able to cover the entire demand themselves, forcing Japan to rely on foreign manufacturers.

The following are examples of demand related to eco-friendly technologies.

• Natural material houses

Owing somewhat to the eco-point system that has been implemented on housing by the Japanese Government since 2010, today “natural materials” are the most preferred type of materials for constructing new housing. “Natural materials” refer to pure, unblended materials. Using solid, natural wood allows for vastly reducing air conditioning use during the summer.
For the external walling as well, the outside of buildings are covered with thermal insulation and insulation sheeting is used on windows to block outside air from entering the house and prevent condensation and drafts. Also, in terms of facilities, people prefer housing that pays thorough consideration to ecological aspects, including completely electrified housing, insulated bathtubs, and solar houses (24-hour heating using solar energy).

• High-efficiency water heaters

In Japan, hot water supply consumes more electricity than heating; where heating accounts for 25.3% of a home’s total energy and hot water supply accounts for 34.3%^※6 .This generates strong interest in using eco-friendly hot water heater products. In recent years people have begun favoring high-efficiency water heaters that use heat from the air to boil water. Such devices use compressed heat from the air to boil water.
Since no burning takes place, these devices give off no emissions, making them a clean technology. Moreover, this technology allows for reducing water heating costs to one-fourth of the cost of conventional hot water heating methods that make use of city gas, and CO2 emission amounts are also cut back by around two-thirds. This type of technology satisfies the eco-mindedness of the Japanese consumer. Furthermore, Japanese are willing to pay for products that bear such satisfaction.

• Private power generation

As power supply is currently unstable in the Tohoku and Kanto regions, private power generation is expected to receive a great deal of attention in the future. Most private power generation comes in the forms of solar power generation or wind power generation. The merits of using solar and wind power are that there is no concern of depletion, they can be used anywhere, there are no running costs, and there is no worry for air pollution, making these methods the most suited for regions that lack power.
The solar battery panels being sold my manufacturers such as Kyocera and Sharp cost between 600,000 yen and 700,000 yen per kW with an average size of about 3.5 kW. While the cost is somewhat high, there is a subsidy system^※7 available, where people can receive up to nearly 1,000,000 yen in subsidies.

• Rechargeable batteries

Due to the current disaster and the resulting power shortages, there is the possibility that it will become common practice to install rechargeable batteries for household use. Such rechargeable batteries utilize cheaper nighttime electricity to recharge and store power, allowing users to reuse them again and again. Combining solar power generation and rechargeable batteries will allow for solving the power shortages that have become a problem in Japan today.
Heaters running on rechargeable batteries (devices that accumulate cheaper heat at night and emit that heat during the daytime) are already being sold in stores. These rechargeable batteries are being sold at high prices, so it was forecasted that it would take several years before they would spread in use. However, the current shortage of power is anticipated to expedite that spread.

• Wind power generation

Partly due to the rich soil of the Tohoku region, there is likely to be increasing demand by companies for installing windmills to use for wind power generation during the process of reconstruction from the earthquake. Wind power generation is a very highly efficient power generation method that can convert approximately 40% of wind energy into electrical energy.
Moreover, the New Energy and Industrial Technology Development Organization (NEDO) and the Agency for Natural Resources and Energy now offer incentives for installing windmills, including a borrowing guarantee for businesses as well as a partial subsidy for the costs^※8 .In addition, wind power generation devices that can be placed on the roof of a common residential home are now being sold commercially and are attracting attention.

• Zero-CO² cities

The post-disaster reconstruction plan includes a proposal for creating a city like Masdar City, located in Abu Dhabi, capital of the United Arab Emirates^※9 .Masdar City is a planned city that emits zero CO² and generates its own power. The city pulls together alternative energies such as wind power, solar power, geothermal power, smart grid, electric vehicles, wall surface greening, and gardening facilities, as well as various element technologies such as greening and agricultural production to create a sustainable city that emits zero CO².
The project aims to promote these element technologies, but more so to advertise the city itself as a model global city to the rest of the world. As can be seen in this proposal, in implementing reconstruction efforts, many people support plans for reconstructing environmentally friendly cities, rather than simply reproducing the cities and houses that existed before.

• Electric vehicles

During the reconstruction process it will be necessary to build new houses as well as purchase new cars. In regions such as Tohoku, public transportation is still underdeveloped and families need to own a car per person. It can be expected that conventional gasoline-powered vehicles as well as electric vehicles are going to sell well. Electric vehicles will allow for solving the shortage of gasoline, which is a vital problem in the post-disaster Tohoku region.
Electric vehicles are extremely environmentally friendly, but another strong point is that they run very quietly. However, despite the attention that they attract, they are still not in wide use. Nevertheless, in recent years technologies have advanced further and these vehicles have become even more convenient due to improved acceleration and reduced charging times. There is thus potential for electric vehicles to spread in use due to the current disaster.