Japan focuses on next big export

Japan is already one of the leading high-tech industries of the world, producing gadgets and appliances that are sold globally, from cars and microwaves to robots for use in surgery, space and mines. The country is a major manufacturing hub, there are Sony, Panasonic, Toshiba and Nintendo appliances in homes across the globe and many of the world’s most famous export brands have their headquarters in Japan or were founded in Japan.

Yet, business leaders in Japan are not happy to let this legacy rest. Indeed, the country’s captains of industry are looking ahead to the future, to 2020, when they believe they will have perfected Japan’s next big export: green cities, or what they like to call ‘smart cities’, according to reports by Japan news media.

The idea of the smart city has been around for several years. Many cities around the world use the term as part of their branding and advertising efforts and because of the economic market aspect to being green, but due to the growing awareness of conservation and the environment, the terms meaning has become somewhat obscure, often reduced to a platitude rather than a real concept.

Broadly speaking, a smart city uses next generation energy systems and urban planning and design to marry the needs of an urban population with the needs of the future (the future being the environmentally sustainable lifestyle and world economy sought by the global community).

Smart cities have a heavy focus on Information Communication Technology infrastructure, looking at the ways in which the technology of the future can help us limit our impact on the environment, such as energy-saving light systems, solar panels, vertical farming and a range of other measures. It also combines this sustainability with a highly educated residential population capable of operating within the technologically advanced economy of the future.

This aspect to smart cities, the human capital aspect, is the theme used by many cities in the present to portray themselves as smart cities, or cities with a smart-ward trajectory. Dubai Internet City in the City of Dubai, for example, has been branded as a smart city for its technologically advanced infrastructure and high-tech economy.

Other cities, such as Edinburgh and Southampton, have promoted their infrastructure as moving toward a smart city design due to technological advancements such as a ‘vision and action plan’ in Edinburgh and the use of smart cards on the Southampton public transport system, which provides greater integration of the service.

Japan’s new export model, which was unveiled at the Combined Exhibition of Advanced Technologies (CEATEC) goes much further than these cursory efforts. Japan wants to create a smart city in an envisioned post-fossil fuel world, one in which oil, natural gas, coal and other finite resources have run out.

This smart city will harness mass amounts of energy through nuclear power and a range of renewable energies, such as the wind, sun, waves, tide, hydroelectric and geothermal. The energy is then distributed through the city via the ‘smart grid’ a network to which every house, office, electric car, bus and train is connected. Every electricity needing structure in the city is connected to the grid, which distributes the energy equally when it is needed, maximizing efficiency.

It is hoped that this new export idea, the smart gird, will rejuvenate Japan’s struggling economy. The country is in the grips of an economic lull, our national currency is increasing in value, which is driving down exports unable to compete with cheaper alternatives like China and South Korea and the government is facing a ballooning deficit, contributing to national debt that is already twice the size of the economy.

In addition, we have just been eclipsed by China as the second largest economy in the world after the United States, although we are certainly still one of the most advanced. It is hoped that the country’s advanced economy and massive high-tech industry will compliment the research and development of a smart grid, although Japan is not alone in endeavors toward creating a smart city.

A project in Australia to create a commercial-scale smart grid in Newcastle has received US$100 million in backing from investors, while a similar project on Jeju Island in South Korea has seen funding of US$200 million put aside. According to the market research firm Zpryme, China and the United States are the world’s two leading investors in smart grid technology, the US Department of Energy has shelled out US$7.1 billion in grants toward the development of the technology while China has invested US$7.3 billion, the largest national investment in the world.

Despite this, there is confidence in Japan’s Yokohama Smart City Project, which will see Yokohama become the site of a five-year pilot program to research the feasibility of smart grids and their use in smart cities. Essentially, the city will be the hub of a social and infrastructure experiment that has the backing of seven major Japanese companies, all hoping to play a part in creating a city model that can be exported to the rest of the world.

The seven companies involved in the project, Nissan Motor Company, Panasonic Corporation, Toshiba Corporation, Tokyo Electric Power Company, Tokyo Gas Company, Accenture’s Japan Unit and Meidensha Corp have a combined revenue for 2010 of over US$700 billion, which puts in context the potential investment power that the consortium has in terms of the research and development of smart grids.