Web3 Momentum Grows

Akihabara News (Tokyo) — The way the world works, shares, and conducts business is changing as the adoption of Web3 technology shows little signs of slowing.

California Governor Gavin Newsom signed an executive order earlier this year compelling the state’s businesses and government bodies to use blockchain technology, whose peer-to-peer caches of data are the cornerstone of Web3 philosophy and infrastructure.

Web3 is a collective term for a new era of the World Wide Web in which it will be built on decentralized technologies such as blockchain and cryptocurrency, and including other developments such as Artificial Intelligence (AI) and Virtual Reality (VR). It aims to be the successor to–and near antithesis of–the existing social media revolution in which vast quantities of information and power flow towards a handful of tech giants like Facebook and Google.

Proponents claim that Web3 will allow for a more secure, transparent, and intuitively-connected network that gives users full control of their online presence and data by storing it on the blockchain.

Other governments are quickly following California’s example.

Among them is Japan. The Ministry of Economy, Trade and Industry has created a Web3 Policy Office to aid domestic development of the technology. Their main aim is to prevent a loss of skilled labor as talented Japanese software developers go overseas.

Venture capital investment in various blockchain enterprises has been rising sharply–US$33 billion in 2021.

IT consultancy firm Accenture found that over half of all wealthy private investors in Asia are holding the Web3 medium of exchange–cryptocurrency–making it the fifth-largest asset class in the region. This figure is expected to grow rapidly.

Meta (Facebook) is among those investing heavily in the evolution of the online ecosystem. Of course, even the new name of the company reflects its goal of leading the tech industry into the “metaverse.”

The metaverse, which is often considered a synonym or closely adjacent to Web3, is a catchall term for a world in which users immerse themselves in the web through VR avatars.

Despite their ambitious pitch, the transition has been a difficult one for Meta. The company lost US$10 billion in 2021. Even still, CEO Mark Zuckerberg remains fully committed to the metaverse model.

Competitors, like Microsoft, have also begun work on similar projects.

According to Accenture, the burden of early adoption has also given the majority of traditional wealth managers and financial advisors in Asia cause for reticence about Web3 technology. Currently, these investors are keeping their client’s money away from such projects due to a poor understanding of the technology and volatility in the cryptocurrency market.

Nevertheless, most of the largest investment banks in the world now consider cryptocurrencies and Non-Fungible Tokens (NFTs), digital items stored and traded on the blockchain, as legitimate assets for investment.

JP Morgan, in a financial review of Web3 and metaverse opportunities, identified them as a potentially US$1 trillion per year ecosystem. The bank’s advice to businesses investigating Web3 is that “the asymmetrical risk of being left behind is worth the incremental investment needed to get started.”

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Japan Casino Resorts in Limbo

Akihabara News (Tokyo) — The hottest summer in Japanese history has so far proven to be stone cold when it comes to major news developments regarding the prospective casino resort industry.

At the end of April, two prefectures—Osaka and Nagasaki—submitted applications to the central government to have their respective Integrated Resort (IR) projects licensed for operations under the terms of the 2018 IR Implementation Act.

Since then, not a whole lot has happened—at least not much that is within public view.

Basically, all there is to do for the local governments and the two IR operator hopefuls is to wait for the central government to determine whether or not these projects will be given a license.

This decision is primarily in the hands of the Ministry of Land, Infrastructure, Transport and Tourism headed by the government’s only Komeito party minister, Tetsuo Saito.

The verdict is believed likely to be announced either in the autumn or winter of this year.

Some industry analysts—notably Bay City Ventures Managing Director Joji Kokuryo—suggest the possibility that some kind of policy curveball could be in the offing. Rather than simply giving a thumbs up or thumbs down to the two applications, Kokuryo suggests, the central government might grant conditional licenses or even scrap the current process altogether and fully reopen bidding to local jurisdictions and casino firms with a new deadline, presumably a couple years in the future.

For now, all remains speculation. Local governments and IR operators just have to wait.

The only side which has continued to be active are the citizen anti-casino forces which continue to chip away at the political will of those few leaders still willing to advocate publicly in favor of casino legalization.

At the end of July, the Osaka Prefectural Assembly voted down a proposal for a popular referendum on the IR project at Yumeshima. Citizen activists submitted more than 190,000 resident signatures, but the pro-IR Osaka Restoration Association determined that the people should not be given a say in the matter—just as had previously occurred in the cities of Yokohama and Wakayama.

Throughout the IR process, it has continued to be a “no democracy zone” in which many conservative political leaders and parts of the business community have repeatedly defied the popular will.

At any rate, the ball is very much in the court of the national government at this juncture, and all interested parties are waiting to see what they do.

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Sora-iina Expands Drone Delivery in Goto Islands

Akihabara News (Tokyo) — Sora-iina, a wholly-owned subsidiary of general trading company Toyota Tsusho, has been expanding its drone delivery program for medical goods in the Goto Islands, Nagasaki Prefecture.

The genesis of the project goes back to June 2018 when Toyota Tsusho made an investment in California-based drone startup Zipline and began collaborating with the firm’s drone delivery operations in Africa.

In March 2021, the two firms agreed to bring their partnership to Japan, promising to focus on delivery of medical supplies to underserved rural areas of the country. The press release noted that it was Zipline’s “first-ever strategic operational partnership, and represents a new model for scaling its on-demand delivery service.”

Practical operations launched this April under the auspices of the subsidiary, Sora-iina, which had been created for the purpose of handling the drone delivery initiative. The inaugural president and CEO is Michelle Mika Matsuyama. The company’s base is located in Goto city, Fukue Island, Nagasaki Prefecture.

As of the beginning of this month, over 150 drone flights have been conducted, with the main route running between Fukue Island and Naru Island. However, as of June 10, a new route between Fukue Island and the most distant of the main Goto Islands, Nakadori Island, also began to be tested–a roundtrip of about 140 kilometers.

Other routes to smaller, even less populated islands are also planned.

The Zipline drones have fixed wings with a wingspan of about 3.3 meters. They are launched into the air via a special catapult. When they return to base a hook on the tail of the aircraft snags onto an outstretched wire, leaving it suspended motionless in the air until the recovery team attends to it.

The payload, which can have a weight of up to 1.8 kilograms, is carried inside the aircraft during the flight, protecting it from the elements. These drones are relatively durable, even in conditions of moderate winds and rain. They fly at a maximum speed of about 130 kilometers per hour. Cellular networks and installed SD cards provide for automated navigation. Delivery is accomplished by the opening of a hatch at a predetermined height, sending the payload dropping to the ground with a small parachute to cushion the impact.

Sora-iina is negotiating with government regulators to allow them to conduct several flights simultaneously. The firm aims to achieve the operational rate of about twenty to thirty flights per day.

When the Japanese government allows Level 4 drone flights–something which is expected to occur later this year–current routes can be shortened, since the drones will then be permitted to fly more directly to their objectives over populated areas.

Sora-iina hopes that its drone delivery service will strengthen overall logistics in the Goto Islands. In particular, since medicine deliveries currently rely on ships with fixed schedules, drones may be able to make emergency deliveries to local hospitals and other facilities on much shorter notice.

It’s also possible that Sora-iina might face a competitor. In March 2021 All Nippon Airways (ANA) and Germany-based drone firm Wingcopter conducted medicine delivery tests in the same area, running flights between Fukue Island and Hisaka Island.

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Nomura Provides Loan to Vertical Aerospace

Akihabara News (Tokyo) — Vertical Aerospace revealed in its latest financial statement that Nomura Securities offered the UK-based eVTOL-maker a loan of up to US$100 million to allow Vertical to retain a large share of its ownership.

Like all eVTOL companies, Vertical is currently spending a lot of money on research, development, and production of its new aircraft (during the first half of 2022 it reported a net operating loss of about US$47 million) and it will not begin making substantial income until its aircraft is licensed to carry passengers–a prospect which is probably still several years away.

In this context, Vertical also announced that it has finished building the first full-scale prototype of its VX4, a five-seat eVTOL model expected to ferry passengers through the skies as well as take on cargo delivery and other missions.

Stephen Fitzpatrick, Vertical Founder and CEO, stated, “I am delighted to share that we have reached a critical engineering milestone by completing the build of our full-scale VX4 prototype, and we have now begun putting it through its paces for an intensive, multi-month flight test program.”

Nomura’s loan is not Vertical Aerospace’s first connection with Japan. Last autumn, two separate partnerships were announced.

Last September, it was revealed that Marubeni Corporation signed a conditional preorder for up to two hundred VX4 aircraft, with an eye towards operating an air taxi service that might, for example, carry passengers from Narita Airport to Tokyo Station.

Less than a month later, it was announced that Japan Airlines (JAL) might buy or lease up to a hundred VX4 aircraft through Avolon, a Dublin-based global aircraft leasing company.

Globally, Vertical says that it now has preorders for up to 1,400 units of its VX4 aircraft.

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Inpex Explores Australia Green Hydrogen Hubs

Akihabara News (Tokyo) — Japan oil and gas firm Inpex Corporation is participating in feasibility studies to create green hydrogen hubs in two Australian states. In both cases, Inpex’s main local partner is the utility firm AGL Energy.

In the latest agreement announced this week, the feasibility study concerns AGL’s Hunter Energy Hub in the state of New South Wales, which envisages both the production of green hydrogen and its export abroad.

The feasibility study will center on AGL’s Liddell Power Station in the Hunter Valley region, eyeing the Port of Newcastle as a potential offloading location.

AGL Chief Operating Officer Markus Brokhof stated that “early estimates suggest the site can support a hydrogen facility of up to 2GW in scale, but we will also test critical inputs including renewable energy costs, firming requirements, electrolyzer capital costs, logistics, and utilization.”

If the project is realized, at least some of the hydrogen produced will be exported to Japan.

Fortescue Future Industries and Osaka Gas Australia are also participating in the Hunter Valley project.

In June, a similar feasibility study involving the consortium of Inpex, AGL, Osaka Gas, and South Korea’s SK Group was unveiled in connection with a potential green hydrogen hub at Torrens Island, South Australia.

In this case, the site of the study is AGL’s Torrens Island Power Station.

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Japan’s Green Transformation

Akihabara News (Tokyo) — The first meeting of the Ministry of Economy, Trade and Industry (METI) Green Transformation panel was held recently, with the aim of establishing a ten-year roadmap to meet the country’s carbon neutrality goals.

The METI minister–at that time Koichi Hagiuda–was provided the additional ministerial portfolio of Green Transformation Minister. Deputy Chief Cabinet Secretary Seiji Kihara explained that his new task was “to manage administrative processes to realize the transformation of Japan’s economy, society, and industrial structure based on clean energy.”

With yesterday’s Cabinet reshuffle, this task now falls to Yasutoshi Nishimura.

In May, Prime Minister Fumio Kishida announced that the government plans to provide approximately ¥20 trillion (US$150 billion), raised via “green economy transformation bonds,” to facilitate the clean energy projects.

Kishida also said that an additional ¥150 trillion (US$1.1 trillion) will be needed for other public and private investments over the next decade.

As part of these efforts, Kishida revealed his intention to authorize the restart of at least nine nuclear reactors by the end of this year as a measure to quickly reduce carbon emissions. The government is also expected to discuss the construction of new nuclear plants.

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Drone Delivery of Fertilized Cow Eggs

Akihabara News (Tokyo) — Aeronext has announced the successful delivery of fertilized cow eggs in an experiment which aims to make drones integral to the raising of livestock in Japan.

The experiments are taking place in Kamishihoro town, Hokkaido, one of the first bases for the firm’s Next Delivery drone transportation service.

In this instance, fertilized cow eggs collected at the JA Zenno Embryo Transfer Research Institute were delivered smoothly and safely via drone to a farm.

The AirTruck delivery drone is being used in these experiments, which Aeronext codeveloped with domestic drone-maker ACSL. It is designed to carry and deliver fragile payloads, and therefore it is believed that AirTruck may be an appropriate vehicle for the eggs.

Fertilized cow eggs have higher rate of conception if there is no need for them to be frozen and if transportation is speedy and smooth.

Shigetoshi Ogura, president of JA Kamishihoro Town, commented, “The shorter the transportation time and the less vibration, the higher the conception rate. I would like to track the results of these experiments and observe the quality of the wagyu beef and the meat of the fertilized eggs transported in this way.”

Hajime Kumagai, the owner of the ranch where the first fertilized eggs were delivered, added, “Right now, it takes more than fifteen minutes each way to pick up fertilized eggs from the local facility. Drone delivery enables fast and safe transportation.”

Aeronext speculates that drone delivery will also be helpful in addressing issues related to manpower shortages in Japanese rural areas as the nation faces demographic crisis.

Kamishihoro town has a population of about 5,000 people and an administrative area of ​​about 700 square kilometers, which is larger than the 23 wards of Tokyo.

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Tokyo Launches Three-Year eVTOL Project

Akihabara News (Tokyo) — The Tokyo Metropolitan Government has selected several companies to implement a three-year project aimed at preparing the Japanese capital for its first eVTOL taxi services.

The companies selected by the metropolitan government are Mitsubishi Estate, Japan Airlines (JAL), and Kanematsu Corporation.

These firms have received the mandate to develop a practical business model for the launch of eVTOL taxi services in Tokyo, as well as to identify the key hurdles to implementation. This includes cost estimates and other economic dimensions related to air taxi services.

Mitsubishi Estate, which owns most of the Marunouchi financial district adjoining Tokyo Station and the Imperial Palace, will be the primary project manager, offering its property to host experiments. JAL will take charge of feasibility studies and the planning of demonstration flights. Kanematsu will provide information on overseas technologies and regulatory trends, as well as work on vertiport development.

Between April 2023 and March 2024, the consortium plans to begin demonstration experiments using helicopters within the metropolitan area. Thereafter it will switch to eVTOLs–though the make and model is undecided.

When the three-year project ends in March 2025, the commercial eVTOL taxi industry is expected to begin soon thereafter, and any additional public funding from the Tokyo Metropolitan Government will be reconsidered at that time.

It has been the Osaka Prefectural Government which has been most proactive about the development of Japan’s eVTOL industry. The 2025 World Expo in Osaka is expected to become the stage for the birth of domestic eVTOL taxi services. The expo is scheduled to open on April 13, 2025, and continue for about six months.

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Toyota Shocks the Powerwall

Akihabara News (Tokyo) — Rooftop solar power installations are becoming more popular for Japanese households, particularly due to the many natural disasters which can lead to power outages on the grid. The need for a more decentralized and resilient power system is apparent.

As part of the answer to this need, Toyota Motor Corporation recently entered the power market by releasing a new product called O-Uchi Kyuden System. This is a household storage battery similar to the Tesla Powerwall.

Toyota offers several plans depending on user needs. The batteries can remain fully charged by rooftop solar panels, or they can power the household on a daily basis, or else some of the electricity can be sold to utility firms.

The O-Uchi Kyuden System directly completes against the more established Tesla Powerwall, which was first introduced in 2015 and has been installed in about 250,000 households globally.

The functionality of the O-Uchi Kyuden System is quite similar to that of the Powerwall. For example, both offer mobile phone apps for users to monitor how much electricity is generated, consumed, and other key data.

However, one unique function of the O-Uchi Kyuden System is that, using a special plug, an electric vehicle can also provide an extra charge to the household battery, suggesting that Toyota is particularly focused on providing energy resilience at the time of disasters.

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Sumitomo and Kanematsu to Lift Singapore eVTOLs

Akihabara News (Tokyo) — Both Sumitomo Corporation and Kanematsu Corporation have made large investments in UK-based Skyports, which is already developing drone delivery operations in Singapore and seems to be edging toward eVTOL operations as well.

In the latest news, Skyports announced that its Series B fundraising exceeded US$26 million. Sumitomo and Kanematsu are major contributors.

This comes on top of an alliance unveiled in February between Sumitomo, Skyports, and ST Engineering to provide drone services for shore-to-ship parcel delivery in the port area of Singapore.

Their stated goal is to create a drone delivery network capable of carrying parcel payloads of up to 10 kilograms.

Ichiro Tatara, general manager of the Commercial Aviation Department at Sumitomo, stated that “unmanned aircraft systems are a potential infrastructure-enabling sustainable transportation. We are very excited to launch a pilot program for shore-to-ship parcel delivery together with ST Engineering and Skyports, and we believe this partnering is a great team and provides sustainable and efficient service to vessels in Singapore.”

Skyports, best known for its vertiport development, also has multiple ongoing projects in Japan.

In April last year, Skyports and Kanematsu unveiled an alliance to develop infrastructure for both the drone delivery and eVTOL sectors.

Last May, Skyports began working with the prefectural government on the Osaka Prefecture Super City, a project launched in 2020 to pioneer “the city life of the future.”

By this February Skyports was also offering its expertise to the Japan Civil Aviation Bureau regarding eVTOL infrastructure development.

Most recently, in May, Skyports and Kanematsu–joined by Park24 and Aioi Nissay Dowa Insurance Company–announced a four-company agreement to construct a vertiport in the Kansai region, perhaps followed by additional projects.

This web of business alliances around Skyports appears likely to link several Japanese firms–particularly Sumitomo and Kanematsu–with the birth of eVTOL services in Singapore as well as in Japan.

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Fusion Energy: The Perfect Solution?

Akihabara News (Tokyo) — Fusion energy is potentially a reusable, unlimited, clean energy source. It’s how the sun makes energy. There’s been some progress in developing fusion technologies, but the timeline still stretches out for decades. Nevertheless, Japanese startups are part of the fusion energy race.

Kyoto Fusioneering, a startup which was born out of Kyoto University, announced that it will have a testing facility for fusion power plant equipment by 2024. It aims to have a fusion power plant up and running within the next five years. The firm has already raised over ¥1.3 billion (US$10 million) towards its goals.

If all goes according to plan, Kyoto Fusioneering’s power plant will have the ability to actually generate power. However, its energy production is expected to be quite modest–the company believes it will be several dozen kilowatts, or about the energy needed to light up a single incandescent light bulb.

Another Japanese startup that has been in the news lately is EX-Fusion, which aims to commercialize laser-based fusion energy. In April it closed pre-seed round funding, gathering about ¥130 million (US$1 million). EX-Fusion initially hopes to generate neutrons in sequential laser fusion reactions.

On the global stage, numerous other fusion energy projects are also underway, but they seem to be quite far from their ultimate goals.

At the the Joint European Torus (JET) facility in Oxfordshire, United Kingdom, the focal point of the European fusion research program, the tokamak (a machine which contains the fusion energy) broke records in late 2021 by sustaining a small burst of fusion energy for five seconds.

One of the oldest and most advanced projects, ITER, isn’t scheduled to start generating a large amount of energy until 2035. This project is based in southern France and is a collaboration between 35 governments, including Japan.

By all appearances, it will be at least 2050 before fusion reactors will be ready to produce energy on a mass scale, and that is simply too late to make it a real solution for the climate crisis.

The only thing that might change this verdict is a major scientific breakthrough, which, at present, is not in sight.

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Japan’s Improving ESG Record

Akihabara News (Tokyo) — Environmental, Social, and Corporate Governance (ESG) commitments are seen as a means to encourage for-profit corporations to promote the welfare of society beyond simply bringing returns to shareholders. After a slow start, Japan too has begun to embrace this international trend, led by the central government.

In 2021, the overwhelming majority (81%) of global ESG investment was found in Europe. The United States made up a further 13%, leaving the rest of world far behind.

In Japan’s case, this appears to be changing. In March, Prime Minister Fumio Kishida announced an estimated US$157 billion in government-funded green bonds to boost carbon neutral development.

Also, the Government Pension Investment Fund, the country’s largest pool of retirement savings, announced its commitment to the state’s Society 5.0 initiative, which is regarded as an example of ESG development.

For its part, the Tokyo Metropolitan Government is also setting out plans to deepen ties on sustainable investment with the City of London, recently crowned the world’s leader in ESG finance.

So far, ESG commitments are emerging mostly from the national and local governments much more than from the business world itself.

London-based international law firm Clifford Chance argues in a report on ESG in Japan that further progress hinges upon uptake from the corporate world, especially among smaller companies.

Japan is making the most progress on the environmental policy aspects of ESG, but this is only one area of concern. In fields such as social and corporate governance, Japan’s improvement has been sluggish, especially when compared to Europe.

For example, Japan’s gender equality rankings are the lowest among G7 nations. As of 2019, only 5.2% of board directors were female. Gender equality outside the executive floor also suffers–44% of women work in part-time or temporary jobs compared to less than 12% of men, according to figures from the Ministry of Internal Affairs and Communications.

Also, while the Japan Business Federation (Keidanren) has significantly altered its Charter of Corporate Behavior to focus more on human rights–now including measures to promote the rights of women in professional environments such as providing maternity leave and taking tougher action on sexual harassment–progress on the ground has been gradual.

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Taiwan Offshore Wind Heads to Round 3

Akihabara News (Tokyo) — By the end of this year, the Taiwan government is expected to award more than 3GW of potential capacity to offshore wind power developers.

Outside of mainland China–which is being developed largely independently from the global market–Taiwan is the most advanced offshore wind market in Asia, with Japan trailing some distance behind.

At present, there are two offshore wind farms in full operation, contributing a total of 237MW of electricity to the island’s grid, which is run by the Taiwan Power Company (Taipower). These are the 128MW Formosa 1 farm completed in 2019 and the 109MW Taipower farm completed at the end of last year.

However, these will soon be supplemented by four major projects which, combined, will contribute an additional 2.5GW of electricity. All of Taiwan’s wind farms lay along its western coastline facing the Taiwan Straits, where most Taiwanese live.

Changhua 1 & 2a: This 900MW offshore wind farm is expected to be completed by the end of this year. It is being developed by Danish multinational power company Orsted.

Formosa 2: This is a 376MW wind farm also set for completion this year. It is being developed by a consortium led by the Japanese firm JERA.

Changfang Xidao: This 589MW project aims to be fully online by the end of next year. It is being developed by Copenhagen Infrastructure Partners.

Yunlin: This 640MW project has consistently run into the most problems. Originally in the hands of a German developer, a broad consortium is financing it, including Japanese firms such as Sojitz Corporation, Chugoku Electric Power Company, Chudenko Corporation, Shikoku Electric Power Company, and JXTG Nippon Oil & Energy.

Aside from the two farms which are operating and the four under construction, there are an additional four farms which have been awarded by the Taiwan government in Round 2 but have not yet moved to the construction phase. These are Northland Power’s 1,044MW Hai Long 2 & 3 farm (in which Mitsui & Co. is an investor); Orsted’s 920MW Changhua 2b & 4 farm, the Copenhagen Infrastructure Partners-led 300MW Zhong Neng farm, and a 300MW Taipower project.

These projects are all expected to be completed between 2024 and 2026.

Location of offshore wind farms along Taiwan’s west coast

The first Round 3 awards, as mentioned, are expected to come by the end of this year. The screening process is now underway, including detailed reviews of the environmental impact.

This auction is highly competitive, with dozens of projects jostling for what will likely be six new awards.

Based on the way it is structuring the process, Taiwan’s government wants to diversify its offshore wind farm developers, making sure that no single firm has too big a slice of the pie. New awards are expected to be limited to under 600MW of potential capacity per development zone.

International developers have sometimes complained about Taiwan’s onerous “localization” requirements. The island’s government desires to become the offshore wind industrial hub for all of East Asia–including the Japan and South Korea markets–and thus is requiring the mostly-European firms to transfer much of their technology to Taiwanese companies and to hire locals as suppliers and partners.

On the other hand, the Taiwan market alone will probably be of insufficient scale to allow the Taiwanese offshore wind industry to be truly cost competitive, and the Japanese and South Korean governments are likely to have their own versions of the localization policy.

Experienced hands in the industry have thus been calling for the creation of a regional offshore wind market in East Asia in which each government has certain fields in which they specialize, and not try to replicate the full offshore wind supply chain in every jurisdiction, which would only make all of them more expensive than necessary.

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ANA and Seven-Eleven Firm Up Drone Delivery Plan

Akihabara News (Tokyo) — All Nippon Airways (ANA) and Seven-Eleven Japan have formed a new agreement to materialize their plan for a nationwide drone delivery service.

Under the agreement, ANA’s main responsibilities will be to establishing the drone operation system, including the selection of the drone aircraft which will be used, and to improve communication stability related to drone operation.

For its part, Seven-Eleven Japan will be adjusting its product delivery service 7Now, deciding which products will be subject to customer delivery by drone, as well as building vertiports at the Seven-Eleven outlets that will be participating in the program.

The two firms expect to begin practical tests of the system in Fukuoka city this autumn and are aiming for a nationwide launch by FY2025.

Like most other drone delivery initiatives in Japan, this one is also focusing on creating services for remote island communities and for those who live in isolated mountain regions.

Seven-Eleven Japan, the country’s largest convenience store chain, launched its 7Now home delivery service in May 2018 and has gradually been expanding it through its national network of about 20,000 stores.

ANA is the largest airline in Japan by revenues and passenger numbers.

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Cryptocurrency’s Place in a Green Future

Akihabara News (Tokyo) — This summer’s soaring temperatures in Texas forced cryptocurrency mining operations to cease activity, and in the process reigniting debate on the technology’s environmental credentials. Even still, strides are being made to develop blockchain infrastructure that is more carbon conscious.

Relatively cheap energy in Texas has attracted crypto-miners to set up operations in the US state, leading to a strain on the capacity of its beleaguered power grid. These operations in Texas are predicted to require 6GW of electricity by 2023, which is a figure roughly equal to the needs of the state’s largest city, Houston.

As of last week, however, the majority of industrial mining ventures have temporarily shut down in compliance with the Texas grid authority’s request for private enterprises to conserve energy.

Cryptocurrency mining is the means by which new coins are effectively “minted.” This is achieved by setting a computer to solve a complex mathematical puzzle in order to generate a new coin. As a blockchain grows, this process requires more elaborate calculations to solve–therefore greatly increasing the computing power and the energy needed.

This “Proof of Work” (PoW) system, whereby a coin is created only if a significant amount of activity is detected from the mining computer, is the critical factor in cryptocurrency’s massive power consumption.

As demonstrated by the shutdown in Texas, the carbon footprint of cryptocurrency mining is a significant weakness in the technology’s growing ecosystem. Bitcoin, the first and still most valuable cryptocurrency, uses around 115 terawatt hours of energy globally each year, thus emitting about 65 million tons of carbon dioxide on an annual basis.

Critics have argued that such huge energy requirements put cryptocurrency out of step with other developing technologies at a time of climate crisis.

Proponents of cryptocurrency argue for patience, asserting that the technology is still in its early stages of development and will make improvements over time.

This position is shared by the World Economic Forum (WEF), which has made partnerships with dozens of cryptocurrency organizations around the world. The WEF suggests that blockchain technology will become a valuable innovation in the battle against climate change.

In particular, the use of cryptocurrencies could streamline costly inefficiencies in global trade and energy management. The WEF also outlines a prospective Carbon Utility Token (CUT), a cryptocurrency purchasable by companies in which all proceeds from trades go towards green investment. The more CUTs that a corporation holds, the higher would be its Environmental, Social, and Corporate Governance (ESG) investment rating.

Work is already under way to decarbonize cryptocurrency infrastructure with developments like Ethereum 2.0. This network, second in value only to Bitcoin, is adopting a new “Proof of Stake” (PoS) system which will be 99% more energy efficient than the established PoW model.

Many smaller blockchain projects, like SolarCoin and Cardano, have been set up as entirely carbon-neutral operations. For example, SolarCoins can only be verified on its blockchain if the mining process is powered by solar energy.

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Creating Artificial Gravity for Moon Colonies

Akihabara News (Tokyo) — Kyoto University and Kajima Corporation, a major construction firm, have proposed the development of an artificial gravity technology which would aim to sustain human life on the Moon and Mars in future decades.

Artificial gravity is believed to be an important step toward allow long-term or permanent human colonies on other planets and moons, many of which have lower gravity than Earth.

Kyoto University and Kajima have proposed a technology they call the “Lunar Glass,” which would allow humans to live comfortably within it.

Kyoto University Professor Yosuke Yamashiki explained, “we wanted to present completely original ideas.”

The Lunar Glass concept was introduced to the public in a YouTube video earlier this month. What it shows is a cone-shaped housing facility which rotates in a manner that simulates gravity on Earth and creates a livable environment.

The precise level of simulated gravity can be adjusted utilizing centrifugal force in amounts that replicate the “1G” conditions of Earth.

The proposed structure would contain all the basic necessities required for human survival, such as air, food, soil, vegetation, and a sizable body of water–even an open sky. This would allow settlers the ability to live for an extended period of time on the Moon and Mars.

The initial design is proposed to be 100 meters wide and up to 400 meters high.

The Lunar Glass would later be followed by the “Mars Glass,” which would be constructed following successful adoption on the Moon.

Artificial gravity, aside from providing comfort, is believed necessary from a human health perspective, especially in cases of long-term settlement.

Infants and young people who grow up in weak gravity could develop problems such an inability to cope with a return to Earth. For example, it is possible that they wouldn’t be able to stand or walk in 1G conditions unless accustomed to doing so. Moreover, some studies have indicated that weaker levels of gravity over a long period could lead to osteoporosis, muscle loss, and eye damage.

Kajima hopes that the Lunar Glass will be deployed to the Moon by 2050, though costs have yet to be calculated.

“Developing an artificial gravity residential facility with Kyoto University will be a watershed moment in space research,” says Takuya Ono, an architect with Kajima.

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Japan’s Internationalized eVTOL Industry

Akihabara News (Tokyo) — It is becoming increasingly clear that Japan’s emerging eVTOL industry does not intend to “go it alone” as a national effort, but is reaching across borders on joint development, particularly with the United States.

This is not the way the nation’s businesses have approached new technologies in the past. It may be a concession to an emerging lack of confidence in Japan’s ability to assume a world-beating position on its own in a more competitive world.

At this point it appears that there may be no such thing as an entirely “Made in Japan” eVTOL.

SkyDrive, arguably the national champion among eVTOL startups, recently announced that its forthcoming two-seater SD-05 will be powered by the EPiC battery system provided by Utah-based Electric Power Systems.

It’s not as if there aren’t major Japanese battery-makers like Panasonic with which SkyDrive might have turned to as a partner.

Some Japanese eVTOL makers, like Tetra Aviation, have adopted a US-first policy: Tetra is entering the experimental aircraft market in the United States, and only at a later stage is planning to return to the Japan market.

Moreover, we have quite recently learned that A.L.I. Technologies, which has developed Japan’s premier hoverbike–the XTurismo–is planning to change its name and to move its headquarters to the United States.

The leaves only the Honda eVTOL (about which we so far know very little) as a possibility to become an entirely domestically produced aircraft.

It works the other way around too: Japanese engineers and suppliers are involved in some of the most prominent international eVTOL firms.

Aichi Prefecture-based automotive components manufacturer Denso is working with prominent German eVTOL company Lilium to co-develop and manufacture the electric motors that will power the Lilium Jet.

Toyota Motor Corporation is the top investor in Joby Aviation, to the tune of about US$400 million, and the partnership involves other forms of cooperation as well, including manufacturing support.

Again, from the point of view of the more traditional Japanese business practice, one would expect that Toyota’s natural eVTOL partner would be SkyDrive, a company founded by former Toyota engineers.

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Total Collapse of Japan IR Initiative in View

Akihabara News (Tokyo) — On the fourth anniversary of the enactment of the IR Implementation Act, the complete collapse of this once-heralded initiative to build multi-billion dollar casino resorts in Japan is very much in view.

Even the most bullish analysts have been forced to admit that the process has not gone well, and it is set to deliver far less than what was initially promised. No one is talking any longer about Japan as the second-largest casino gambling market in Asia.

The several dozen international companies aiming to grab a piece of the Japan bonanza have been whittled down to only MGM Resorts International and Casinos Austria International.

Dozens of local governments in Japan that had once floated the notion of becoming hosts for these massive entertainment facilities have also been reduced to only two.

And the national politicians who most keenly championed the IR legislation are, with few exceptions, either dead, retired, or tarnished by bribery or sexual harassment scandals.

Put simply, this controversial initiative is now in a very sorry state.

Four years ago, the IR legislation was pushed through by the ruling party and its allies in the face of unanimous rejection by the opposition parties and against the wishes of a clear majority of Japanese public opinion.

Step-by-step, public disapproval has worn down the proponents. Some pro-IR politicians were defeated at the ballot box, some stymied by opposition in prefectural assemblies and city councils, and others put their fingers to the wind and then bowed out before they damaged their own political careers.

Nagasaki is still in the IR race because the local government did a better job than anyone else in preparing local public opinion to accept casino gambling as a necessary evil to help revive the tourism-based economy.

But they may have shot themselves in the foot by selecting a very weak IR consortium which won’t even make public its financing plans. While not entirely proven, circumstantial evidence suggests that they rejected stronger bids at the last minute largely because the investment money would have come from China.

The Osaka bid is also in trouble. Although the locally-dominant Osaka Restoration Association made the Yumeshima IR a signature policy, much has gone wrong since the high tide in late 2018: delays meant that most synergies with the 2025 World Expo have been lost; the land earmarked for IR development has been found to have multiple contamination and soil liquefaction problems; the burden on local taxpayers has been increased in violation of earlier promises; a defeat on administrative reorganization has induced Osaka Mayor Ichiro Matsui to announce his retirement from politics next year; citizen lawsuits have been filed; and the opposition Liberal Democratic Party has decided to throw in with the opponents of IR development, smelling the blood in the water.

While it is by no means impossible that one or both Nagasaki and Osaka may yet crawl over the finish line, receive an IR license, and built their casino resorts, this is starting to become the less likely scenario.

And should the current process in fact collapse and no IRs are licensed this year, it also seems probable that Prime Minister Fumio Kishida will let this unpopular initiative die. Casino resorts seem rather out of step with the spirit of the “New Capitalism” policies which he champions.

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SkyDrive SD-05 Taking Shape

Akihabara News (Tokyo) — The yet-to-be-unveiled SkyDrive SD-05, a two-seater eVTOL, is coming closer to realization as the firm has announced two key component suppliers.

Shiga Prefecture-based Toray Carbon Magic will be supplying advanced carbon fiber reinforced plastics for the vehicle.

A release from SkyDrive explained that “the most important factor in the development of the two-seater SD-05 is to reduce the weight of the vehicle. Toray Carbon Magic’s design and manufacturing technologies and facilities are extremely effective in achieving this goal, and we have been engaged in discussions and prototypes of a light and strong carbon fiber reinforced plastic structure for a flying car.”

It added that, in addition to being strong and lightweight, “carbon fiber also has features such as electrical conductivity, heat resistance, a low thermal expansion coefficient, self-lubricity, and X-ray permeability.”

SkyDrive CEO Tomohiro Fukuzawa described the use of this material as being “an essential element of our two-seater aircraft SD-05.”

Separately, it was announced that Utah-based Electric Power Systems has been selected to design, develop, and manufacture the battery system for the SD-05.

The SD-05 will employ the firm’s EPiC battery system, which includes battery modules and a battery management system.

When the EPiC battery system was unveiled last year, Electric Power Systems CEO Nathan Millecam stated that it represents “a major step forward in advancing electric propulsion for airborne applications. Our modular platform allows aircraft designers the ability to create innovative new airframe concepts, as well as revitalize legacy airframes.”

In 2019, Boeing and Safran invested in Electric Power Systems to enhance its research and development, energy storage, and electric propulsion capabilities. The Utah firm’s publicly announced customers include NASA, the Federal Aviation Administration, Boeing, Safran, Bell Textron, and Embraer.

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Nuclear Power as Green Energy

Akihabara News (Tokyo) — Barring the unexpected, nuclear energy will soon be recognized as climate-friendly investment in the European Union. It cannot be said that all observers are in agreement with the policy.

Nuclear power plants can produce large amounts of stable energy. The output of a single power plant in the United States can provide power to upwards of a million people. At present, about 72% of France’s energy is provided by nuclear.

Moreover, nuclear power produces seventy times less carbon dioxide than coal, and forty times less than gas. It releases a similar amount of carbon as wind energy, and four times less than solar. In many ways it is equal or even superior to other “green” energy sources.

On the other hand, nuclear power has long been a target of environmental organizations such as Greenpeace. Major disasters such as Chernobyl and Fukushima Daiichi have associated this form of energy with radioactive contamination of the oceans and the natural landscape. This has badly damaged its reputation as environmentally responsible technology.

Lobby organizations such as the World Nuclear Association, however, are keen to stress that such disasters are extremely rare, and have resulted in considerably less grave outcomes than initially predicted.

Still–taking the case the of Fukushima–a huge area of land has undergone extensive radiation decontamination measures such as the total replacement of topsoil with crushed granite. Tens of thousands of local residents have been displaced, some of them for more than a decade. Lives have been lost through such disruption of normal activities.

Anti-nuclear campaigners also point out that power plants are vulnerable to military conflicts and acts of sabotage, including cyberattacks. This vulnerability was most recently demonstrated during the Russian invasion of Ukraine when heavy fighting took place at the Zaporizhzhia Nuclear Power Station as well as at the site of the Chernobyl disaster.

Another argument against embracing nuclear power as green energy concerns the unresolved issue of the disposal of nuclear waste.

A standard nuclear power plant produces three cubic meters of waste per year. In the United States alone, two thousand cubic meters of waste is produced annually, most of which remains stored at the plants themselves. Presently, there is no universally agreed solution for the safest and most effective means for final disposal, storage, or reuse of radioactive waste.

This problem might be mitigated by recycling the waste into reusable fuel, as is commonly done in France and the United Kingdom. Uranium, for example, retains about 95% of its potential energy even after it is used a first time.

In respect to the climate crisis, some environmental campaigners argue that nuclear is simply too slow to effectively combat rising global temperatures and avoid catastrophe–it takes many years to design, approve, and build new nuclear plants.

The costs of building new power plants are also quite substantial. While it varies by country, the average price tag is about US$9 billion for a 1.1GW facility. In some cases, costs can more than double. Operating costs are also not cheap. For poorer countries, nuclear power may simply be out of reach from a financial perspective.

Finally, it should also be mentioned that nuclear weapons proliferation concerns have been used to stall the development of civilian nuclear power plants in countries such as Iran.

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