In the early stages of the Fukushima nuclear crisis, when politicians were embroiled in fierce public feuds over how best to save Japan, a little-known banker continued to be the go-to man behind the scenes.
The main job of Tadashi Maeda, 54, is chief of the Corporate Planning Department of the Japan Bank for International Cooperation (JBIC). But as a special adviser to the Cabinet, he has constantly been called upon by the Democratic Party of Japan for advice on energy-related matters.
As such, Maeda has been deeply influential in decisions related to Tokyo Electric Power Co., operator of the stricken Fukushima No. 1 nuclear plant, plans for exporting nuclear technology, and even an economic growth strategy for the nation.
"He is a genius,” Yoshito Sengoku, the acting DPJ policy chief known as the "shadow prime minister," said of Maeda. “He is capable of both lobbying and intelligence work. There are few like him."
Maeda will now likely be a key figure in deciding the future of Japan’s nuclear energy policy--and his stance may not mesh with that of the politician who brought the banker into the government’s decision-making process: former Prime Minister Naoto Kan.
Throughout the course of his banking career, Maeda has developed ties to politicians in both the Democratic and Republican parties in the United States as well as members of royal families in oil producing nations. He also has relations with influential individuals in Russia and Kazakhstan.
It was his long relationship with Kan that led to his appointment as special adviser to the Cabinet in June 2010, when Kan was prime minister.
At one time, the Cabinet had 15 special advisers. Maeda is one of the remaining five for the Cabinet of Prime Minister Yoshihiko Noda.
Maeda’s value to the Cabinet became apparent after the March 11 Great East Japan Earthquake and tsunami knocked out power at the Fukushima plant, leading to multiple meltdowns of the reactors.
In May, when Sengoku was deputy chief Cabinet secretary and trying to put together a compensation package for TEPCO, he turned to Maeda for advice.
After a government panel was established to look into TEPCO's management and financial situation, Maeda was appointed to the panel as "an adviser to Sengoku," in the words of committee chairman Kazuhiko Shimokobe.
And after the Nuclear Damage Liability Facilitation Fund was set up, Maeda became a member of the steering committee making the decisions for the fund.
In the current debate on Japan’s energy policy, the two major issues are moving away from nuclear energy and liberalization of the electric power sector. After the nuclear accident started, Kan became a leading proponent in phasing out nuclear energy in Japan.
Maeda, however, is somewhat skeptical about a total move away from nuclear power.
"As it has become difficult to resume operations at nuclear power plants, the dependence on nuclear power will likely decrease in the future," Maeda said. "What would replace nuclear power? The first option would be natural gas, which is comparatively clean. While renewable energy sources may be an option in the long term, to say that renewable energy will expand hugely over the next three to five years is nothing but nonsense."
Since before the March 11 disaster, the DPJ-led government has called on Maeda to come up with an economic growth strategy.
One idea pushed by Harufumi Mochizuki, the former vice minister of economy, trade and industry who, like Maeda, has been named a special adviser to the Cabinet, is to export infrastructure, in particular nuclear power plants.
Before Sengoku visited Vietnam in spring 2010, Maeda traveled to the Southeast Asian nation to make arrangements. Vietnam later ordered two nuclear power plants from Japan. Three months later, Maeda was named special adviser to the Kan Cabinet.
The Fukushima nuclear accident has not changed Maeda's mind about exporting nuclear plants.
"I will not say we should export a huge number like before (March 11)," Maeda said. "And I believe there is an argument about why should we be exporting at a time when we are moving to reduce the number domestically. However, regardless of where Japan goes, there is a growing move abroad to construct nuclear plants.”
He cited China and India as examples, and said there are no measures to stop the trend, especially given the determination of Japan’s rapidly growing neighbor to build such plants.
“If an accident should occur in China, Japan will be affected as a neighboring nation. It will not be possible to employ a closed-nation mentality that says Japan will be safe because we are not building nuclear plants,” Maeda said. “For that reason, there is nothing strange about having foreign nations employ the technology of Japan that has experienced the accident and strengthened safety measures."
Maeda emphasized the need for a more realistic outlook while taking into account the big picture.
"It is easy to argue for a move away from nuclear power," he said. "However, even if all 54 nuclear reactors in Japan stopped operations, nuclear fuel rods would still be in place and spent nuclear fuel will also remain. How will those be removed safely and where would the fuel be stored temporarily before final processing?”
He also said Japanese engineers would probably leave the country if Japan were to suddenly cease operations at all nuclear power plants.
“That could lead to a brain drain to nations such as China and India that are planning to construct nuclear plants. For those reasons, I believe we have to maintain our international competitiveness in the nuclear power sector and gradually reduce our dependence on nuclear energy. It will not be easy to move away from nuclear energy," he said.
Maeda said his realistic approach to problems is the result of his background.
After graduating from the University of Tokyo, Maeda entered what was then the Export-Import Bank of Japan in 1982. He also developed a network of personal connections among central government bureaucrats when he was dispatched to work in the Finance Ministry's international finance bureau.
During his five years of working in Washington, D.C., Maeda became acquainted with such officials as Richard Armitage, the former deputy secretary of state, and Norman Mineta, a former transport secretary.
As the head of the natural resources and finance department, Maeda spent half of his time abroad. In that capacity, he formed ties with royal family members in oil-producing nations, such as the United Arab Emirates (UAE). He assumed his current post at the JBIC after the realignment of government-affiliated financial institutions.
Having worked on the front lines of the global economy and becoming familiar with the dynamics of international politics and industrial competition strategies of various nations, Maeda said he learned to emphasize realistic thinking over hollow theory.
"My motivation originally arises from national energy security and moving away from use of fossil fuels," Maeda said. "Such representative oil-producing nations as the UAE and Qatar are already thinking about how to manage their national wealth because they are aware that their fossil fuels will one day dry up. That has led to sovereign wealth funds.
“Japan does not think in such terms, and it may have passed on the bill to future generations on the thinking that they would be happy as long as the current age is a good one. I realized the gap in thinking between the oil-producing nations and Japan from about 2007, and I became increasingly concerned that Japan was heading for trouble if nothing was done."
For those reasons, Maeda believes that in the drive to move away from nuclear energy, serious thought has not gone into what would be a shift toward fossil fuels.
At the same time, Maeda strongly advocates the liberalization of the electric power sector, saying the industry has pretty much quashed past efforts made by the Ministry of Economy, Trade and Industry.
"There are inefficient elements to Japan's electricity system due to its regional monopoly nature. Efforts have to be made to introduce competition by separating power generation and transmission functions to promote liberalization," Maeda said.
He also criticized TEPCO’s announcement on Jan. 17 to raise electricity rates by an average 17 percent from April for large-volume users, such as factories and offices. That announcement came while a panel of experts established by Yukio Edano, the METI minister, was considering a review of how electric rates are calculated.
Although TEPCO has discretionary authority over its rates, Maeda said it was wrong for the company to make the decision without waiting for the committee's conclusions.
"The rate increase is aimed at manufacturing activities for major and small businesses," Maeda said. "While households may have the leeway of conserving on the use of air conditioning, the same is not possible for companies and their manufacturing activities. In that case, they will have to move production overseas, further accelerating the hollowing out of industry.
“This is a matter about the rise or fall of Japan. Even from the standpoint of an ordinary citizen, the sudden rate increase announcement by TEPCO is questionable. With the company making such a hasty decision, questions will arise that it is doing so to maintain its current management structure," he said.
TEPCO executives may feel they have to make a last stand, as plans are moving forward for the Nuclear Damage Liability Facilitation Fund to inject 1 trillion yen ($13 billion) into TEPCO and bring the utility under effective national control.
A virtually nationalized TEPCO could start the process for various reforms of the electric power sector, including separating power generation and transmission functions and expanding the use of renewable energy sources. That is the growing consensus among younger bureaucrats working in the Agency for Natural Resources and Energy and the Cabinet Office.
Although Maeda says he is taking a realistic approach to the issue of whether Japan should abandon nuclear energy, officials with different views say they are the ones dealing with reality.
At a Jan. 24 meeting of METI's Advisory Committee for Natural Resources and Energy, those who favor moving away from nuclear energy said the Fukushima accident showed the realities that Japan lacks direct control over nuclear safety and is incapable of dealing with serious accidents.
But those in favor of promoting nuclear energy said even if efforts were made to use renewable energy sources, the reality is that Japan would still need a certain level of nuclear power generation.
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