JULIA TAYLOR KENNEDY: Welcome to Just Business. I'm Julia Taylor Kennedy.
Over the next half-hour, we'll be talking about green innovation in East Asia. Maybe because of the economic woes here in the United States, Asia seems far more committed to finding new sustainable technologies than North America does. We'll look at two ways this trend is popping up in Asia, starting with Nobuo Tanaka, Japanese official and former executive director of the International Energy Agency.
Despite Japan's recent nuclear disaster, Tanaka sees alternative energy sources, including nuclear, as keys to Asia's future. Tanaka began by telling the Carnegie Council's Devin Stewart how Japan's energy policy is recovering from the Fukushima plant disaster.
NOBUO TANAKA: The Japanese situation now is such an interesting one because of the Fukushima Nuclear Power Plant accident, its catastrophe. The government has started to rebuild the energy policy of Japan and tried to make a best mix of different energy sources. Of course, nuclear power is a very important part of it, but nuclear power cannot be deployed as much as we had thought before. It means that if nuclear is not that available, then we need to use more gas. But where should the gas from?
DEVIN STEWART: Why isn't it able to be deployed?
NOBUO TANAKA: Because, simply, the public acceptance of nuclear is tremendously undermined because of the accident. There's, let's say, an important lesson from Fukushima. But without clear safety standards, more strict standards of safety, the people will never accept nuclear power to build and to be deployed in Japan—unfortunate, but it's a very tough truth after Fukushima.
What I'm saying is that, yes, we need all the energy sources, not only atomic energy, but renewables, gas, coal, oil—also energy efficiency is a very important one—to try to give what other countries are trying to do. Europe is trying to make renewable energy a much more important option, like Germany. The United States has huge resources of natural gas. A shale gas revolution is happening. China has coal. Russia has everything.
To protect the stable supply of energy, we need to have a good policy in Japan—not only in Japan, but more collectively with other countries around Asia. What the Japanese government is trying to do in the country certainly has implications for the global collaboration.
DEVIN STEWART: Some media have recorded you as being fairly pro-nuclear energy for Japan. One would think that that would be applicable for other countries. Do you think that nuclear energy is morally right, given what we have seen in Fukushima? What are the ethical considerations that one would have to weigh to make those decisions?
NOBUO TANAKA: The ethical perspective of nuclear power should go to the weaponization of the nuclear power. Japan, as you know, has historically the big theme of the nuclear bomb in the Second World War. We condemned the use of nuclear weapons, and we are a strong promoter of diminishing nuclear warfare, as well as defense mechanisms or whatever is the military use of nuclear. Japan committed very strongly to the safety of peaceful use of nuclear power.
Accidents are another thing. Human technology always causes accidents, and nuclear is not an exception. How to prevent these tragic accidents from happening is a very important issue. It's a technological issue. It's a government role. It's a private sector role as an operator and a utility. We have to manage this technology, to use it for the economic growth of the country and to make people's lives easier, healthier, and wealthier. This is a necessary part of the energy supply. As a base load of electricity, nuclear has definitely the established technology and cost-benefit.
A country like India or a country like China or Russia, these emerging big countries are going to use nuclear power, regardless of what would happen in Japan. We want to see that happen peacefully and safely. Otherwise, we suffer. We are located east of these countries, and all the possible plumes of an atomic accident will come over us if something happens there. It is a very strong necessity on the Japanese side to maintain the safe technology for the operation in our neighboring countries.
DEVIN STEWART: India and Vietnam both are eager to increase their energy generation. They are looking toward Japan, for its record of being able to manufacture power plants. Is it right for Japanese companies to sell Japanese nuclear power in other countries if the Japanese people themselves, at home, are against nuclear power?
NOBUO TANAKA: It's not a matter of ethical or not. This country needs the technology, nuclear power. We have to sell it and help them to build safer nuclear reactors. But my assumption is that without holding the very good capacity of building nuclear power reactors in Japan, we cannot export. It's not a matter of ethics. We cannot be considered as a reliable supplier if we are not using it in Japan.
Simply, this kind of thing will not happen, because maintaining the capacity of producing reactors or facilities or steam generators or these major technologies must be maintained by manufacturing it. If you quit manufacturing, these technologies or techniques will be lost.
So it's not a question of ethics, but more an economic or technological necessity, that maintaining the capacity of nuclear power is necessary in Japan, if we want to export it.
DEVIN STEWART: A lot of people have said that the trust in the government has declined quite a bit after March 11.
NOBUO TANAKA: Not declined, totally lost.
DEVIN STEWART: Can it recover? What are the consequences?
NOBUO TANAKA: This is a really serious problem after Fukushima. The Japanese government regulatory authority lost the confidence from the public—possibly politics also, losing the confidence of controlling and managing the situation. There are plenty of cases and evidence and lessons from Fukushima that we are learning. Unfortunately, this was human error. Certainly the responsibility is in the government.
Whatever the technology, I think the trust in the government or producers or utilities is really the key element. Without public acceptance, it's very difficult to deploy these technologies.
Can we recover it? The only thing we have to do is to very precisely analyze why this mistake, the human error, happened in Fukushima. We know that at the Fukushima Daiichi Power Plant, which caused this accident, many of the scientists or nuclear engineers whom I talked to recently told me that everybody knew that this power station had a risk, but nobody reacted to the fact that there was a risk. And they could have done something.
Other stations are very close by. North of Fukushima Daiichi, there is Onagawa plant, Tohoku Electric. They built the power plant 10 meters higher than the original plant, because they know that a tsunami is a very common catastrophe in that region. So they prepared themselves for the tsunami. This plant was totally safe.
This problem of seismic shock didn't cause any problem to any reactor. But other stations, like Fukushima Daini—this is the same TEPCO [Tokyo Electric Power Company] station, but they have a much newer facility. They had prepared for the occurrence of the tsunami.
Another very interesting case is Tokai Daini. This is in the Ibaraki Prefecture, a little south of Fukushima. It was also attacked by the tsunami, but escaped because they built a facility of emergency pumps, et cetera, into the cage, or building, to protect from the tsunami, just by a matter of a day or two. They were in time.
It's very unfortunate that Fukushima Daiichi didn't prepare enough for the tsunami. There should be some reason for them. To analyze who is responsible, what was wrong with this plant is the very, very important lesson that we learn and show to the public why we made this mistake. By doing so, I think at least this transparent and clear lesson will help to recover some part of the trust or confidence we lost. That kind of exercise is really important—transparency, et cetera.
Also we made a lot of mistakes. For example, after 9/11, a terrorist attack was really imminent in the United States. They asked all power plants to prepare for that kind of attack and eventual plant station blackout. All the reactors in the United States prepared for such an occurrence. The NRC [Nuclear Regulatory Commission] suggested that Japan should do the same thing. We just simply declined to do it. And if we had done so, probably this accident could have been avoided.
So there were lots of mistakes the regulators made. These facts are getting revealed one after another, with lots of different investigation commissions, created by the public, created by the private sector. This is a very important ethical, in a way, obligation of the government to show the people why we made a mistake.
DEVIN STEWART: That's a great note to end on, Mr. Tanaka. Thank you so much.
NOBUO TANAKA: You're most welcome.
JULIA TAYLOR KENNEDY: That was former Japanese energy official Nobuo Tanaka speaking with the Carnegie Council's Devin Stewart.
Up next on Just Business is Arthur Huang. Armed with experience at architectural firms in the United States and architectural degrees from Cornell and Harvard, Huang returned to his homeland, Taiwan, to teach and create his own green venture. He began his company, MINIWIZ, as a nonprofit and soon converted it to a for-profit sustainable venture.
The company created a new translucent building material from recycled bottles called POLLI-Bricks. MINIWIZ uses similar materials for other products, like iPhone cases and reusable water bottles.
POLLI-Bricks gained international notoriety when Huang used them to design and build an award-winning, stunning convention center for the 2010 Taipei flower show. He called it the EcoARK and earned coverage in The New York Times, BBC, and National Geographic.
ARTHUR HUANG: We are constantly just eating brand-new stuff, virgin material. We're extracting. And most of the energy being consumed is from extracting raw material from earth, using raw energy generated from these raw materials. We are turning that into materials to make products. The products are actually to fulfill a personal desire. That personal desire is completely psychological. It has nothing to do with actually feeding us, making us full, making us warm, making us go to the bathroom properly. No, it has nothing to do with that. It has everything to do with vanity—
JULIA TAYLOR KENNEDY: Well, sure, of course.
ARTHUR HUANG: It's a loaded question. But this vanity normally has to do with sex. If you actually look into that, for us, humans are just like single-celled organisms. We constantly want to procreate, dominate resources. But I think there's one thing that really bypasses a single-cell organism. When they are full, they are fully fed. They are not hungry. They are not thirsty. They have shelter. The next thing they worry about is being cool—able to procreate, able to dominate resources.
That's why marketing always talks about how sex sells, sex sells, sex sells. It sounds very crude and it sounds very bad, but if we have belief, maybe we can utilize that to trick the market that trash can be sexy. If trash equals sexy, trash equals fashionable. So literally we're eating our own excrement.
JULIA TAYLOR KENNEDY: So you have a design background. Actually, the product that you have designed is kind of sexy. Tell me about how you designed it with the idea of evoking the bottle, making it stylish, and bringing consumers in.
ARTHUR HUANG: What we are doing normally is two ends. One is the actual hard technology, the technology required for us to process trash into something that's usable, structural, and functional. That's one part of our business model.
The other part is what you were just mentioning. It's branding, education. That's why teaching is a very important part of my job. Another is sharing the ideas with more young engineers, young entrepreneurs who are willing to go into this field. So education is a very big part.
The third, obviously, is educating the consumers. I think that's a bigger part. You might have a good sustainable idea. You can turn trash into a product. But at the end, you have to make the consumers believe that this is something they need, not on the sustainability issue alone. It can be a structural issue. I'm trying to build a wall that's more translucent, more structurally sound, more insulated than glass, and cheaper, so they will consider that as an alternative option, a viable option.
Then you figure out, for every product, what is that one thing that ticks the consumer? Normally that little tick is not very logical. That little tick is about sexiness, the flair, the charm. For example, on the architecture side, how do you market an architectural product? For exterior, you notice that translucency is ultra-crucial. Any translucent product sells more. Why? Because it allows light to slightly penetrate out. These days you see a lot of MTV, bling. You have to have bling. The bling actually comes from the reflections, also from the translucencies. That translucency kind of signifies sexiness and higher price.
JULIA TAYLOR KENNEDY: The POLLI-Brick—I saw it on your website—is the basic brick that then you put together for modular materials to build things, like this EcoARK that you built for the floral exhibition. It looks like a bottle. How did you come up with that idea?
ARTHUR HUANG: First of all, when you transform anything from the original shape to another—there is a reason why the bottle looks like that. There is a reason why anything looks a certain way. It has to do with the manufacturing strategy or manufacturing technology.
We basically take the typical, un-uniform waste bottle. We turn that into a uniform, honeycomb-shaped bottle-like thing. These things interlock each other to create a structural bond mechanically, without glue. They are like these 3D Lego pieces, but hexagon-looking. They lock to each other without glue. Basically, we designed this rivet system that laminates them into a sheet. They become a composite wall. That's what we call it professionally, a composite wall.
All this is actually derived from the shape and the sizes and the fold, the different types of angles that we actually calculate. I would say they are all purely engineering physics-driven. The design aspect of it is very low. It's about making it work. Structurally you have to resist against typhoons, earthquakes, fire. So there are all these additional elements required in the building products.
JULIA TAYLOR KENNEDY: But one end looks like the neck of a bottle and the other end looks like the bottom. Those are clearly design choices, right? You could make them flat.
ARTHUR HUANG: No, no.
JULIA TAYLOR KENNEDY: No, they're not?
ARTHUR HUANG: No, they're not design choices. I was mentioning that the reason a bottle—when you want to remake PET from existing manufacturing technology, there is a set of—
JULIA TAYLOR KENNEDY: PET?
ARTHUR HUANG: PET is a type of plastic that you see in every single one of your water bottles or Coke bottles that we are using. It's actually a balloon. It's dried to shape a certain way. Imagine you are blowing up a lot of these little balloons. There is a manufacturing technology that already comes, 30 years of manufacturing technology. It's not like we try not to make it into a bottle. It's the manufacturing technology required for us to do this, in order to create economies of scale.
JULIA TAYLOR KENNEDY: I see.
ARTHUR HUANG: Otherwise, you won't be able to do it.
JULIA TAYLOR KENNEDY: Interesting. That's really fascinating. I would never have guessed that.
How important is a project like this big EcoARK project that you did in Taipei to launch the business and get this bigger visibility?
ARTHUR HUANG: Before, we did a lot of products that are not really seen in the public sense. But there is a powerful effect when a technology is completely overwhelming in terms of a cover over you in three-dimensional space. This is, I think, very crucial. All of a sudden you have trash that surrounds you and protects you from the wind, from the earthquake. It lights up beautifully like an LV [Louis Vuitton] store. All of a sudden it really makes you rethink, and all that imagination in everyone's mind runs. That is what the power of the architecture project is.
A lot of people say architects are very egotistical. It's not that they are egotistical; their buildings are. The building is amplifying the three-dimensional space that at the end is kind of what surrounds us, really, in a very physical sense.
JULIA TAYLOR KENNEDY: It's amplifying their unique vision, their expression.
ARTHUR HUANG: Yes. That expression is there. That alludes to different imaginations within everyone.
For us, it's a communication. That communication really took off when National Geographic also decided to film the whole process and the building activities, and we got one of the best sponsors, one of the biggest producers—the Far Eastern Group—of this type of plastic. And they are one of the biggest recyclers in Asia. So it has this business aspect that links the aspiration of the company and also the communication aspect that we want to the potential consumers. All this becomes a win-win situation, let's say, in the business sense.
JULIA TAYLOR KENNEDY: Is your market primarily in Asia or in the United States at this point?
ARTHUR HUANG: Our primary market currently is in Asia and Europe, in Southeast Asia.
JULIA TAYLOR KENNEDY: That makes sense.
ARTHUR HUANG: We are definitely thinking about coming to the United States. However, during the economic crisis, U.S. development heavily slows down. The United States also has relatively traditional, very high-quality-based architecture. In the United States or, for example, in London, the UK, or in Germany, these are very high. It's hard for young guns like us to convince unions, to convince older industries, people, experts to adopt this new strategy. That's going to take time.
Of course, in the developing nations or, for example, Taiwan, the scale and the affected parties are a lot more controlled. So you can actually execute more directly on to the market. That's why we use that as our first step. Most of our building activities are currently in China and Southeast Asia. We are helping them, I think, also vice versa. This is a way of having a growth strategy that's both sustainable and very effective, for us as a company and also for overall sustainability issues.
JULIA TAYLOR KENNEDY: What is the climate like to be working in a sustainable enterprise in Taiwan, would you say, compared to Europe or compared to China?
ARTHUR HUANG: In terms of rhetoric, in our company we have this T-shirt called "No Virgins," no virgin material. That's our two-word punch line: "No Virgins."
But most people in China won't get that. They won't get the sustainability issues. They won't get that. All they care about, actually, is looks and functionality and price. But in the West—for example, in Germany—this "No Virgins" thing actually means a lot. That becomes a punch line, idea generator, a conversation starter. You can come up with many conversations during a dinner party.
In Asia, one side is very practical in terms of what sustainability has to do. They don't really care about sustainability: "Just give me the price. Make sure it works. Then make sure you can deliver."
In the West, you get a lot of debates. "No Virgins," these two words—100 percent made from trash. And people debate about sustainability issues: "How much energy do you put into reprocessing? That's the first thing people ask. How much toxicity do you put in? How can you compound them? Why didn't people do it before? Is that the best sustainable strategy? Have you looked into other technologies?"
JULIA TAYLOR KENNEDY: And how do you answer them?
ARTHUR HUANG: I can answer them. Of course, as you can imagine, I was challenged everywhere. First of all, in the manufacturing part, we try not to use chemicals, period. All this technology was not really possible before. When you are remanufacturing trash, it's always down-cycling. The carbon chain got broken down. The material is uneven, inconsistent. It's softer and it's weaker structurally. When it's rebonded together, you can just imagine, you have lots of these little carbon chains. They're all broken.
JULIA TAYLOR KENNEDY: People have clicked their bottles back and forth, it has gotten impacted, all kinds of things.
ARTHUR HUANG: Yes, exactly. So you cannot put them back together. If you put them back together, they're weak. That's why they can be used.
A bottle to a bottle, you transform a bottle back to a bottle. That is not up-cycling nor down-cycling. It's called recycling. But we can't even do recycling in reality. Right now we can only do down-cycling. We take a bottle and we turn that into cheap yarns for your pillows, for your carpets. That's basically it. After that, there's no more third life. You have to go to the dump site or burn it.
What we are trying to do is take these waste materials and go up in terms of structural properties, go up in terms of utilization. How we did that was actually using a technology that we developed throughout the years. It's called agro-silica. Basically, we use organic rice husks and barley husks. Twenty percent of the rice that we eat is actually the husks. They are dumped as a waste. They are actually being used as a fuel to burn. After being burned, we have a special process, a mechanical process, that gets the nano-silica particles out from the husks.
The Great Wall of China—actually, a lot of it is using husks for its mortar between bricks. What they didn't know back then is why husks actually increase structural value, structural properties. They just thought it was a fiber. But it's not. It's actually the silica that increases the structural properties.
Let's just imagine this silica powder. We call it the magic salt. Then we can start bonding trash material back together better. Then we can go through the injection molding process. We can go through all kinds of different manufacturing processes, using the same remanufacturing process, by blending it with this material. The material gets less porous, it gets stronger. The carbon chains get bent, turning into a uniform shape and structure. This becomes viable.
That's the core technology that we work on to come up with new materials.
JULIA TAYLOR KENNEDY: What you have just explained is that you found another sustainable material to help fill in something that you needed. I think you're sort of explaining the details of a much larger question which a lot of sustainable enterprises grapple with, which is how to balance keeping my product affordable, keeping my product attractive with keeping it as sustainable as possible. How often do you come up against these kinds of balancing questions in your work?
ARTHUR HUANG: This dilemma was happening four years ago when we were doing ABS, when we were doing other materials. We were having a lot more problems. Now, since we are more and more getting the hang of what we are doing, and we are controlling the organic source of the glue, the agent that we invented, the silica—
JULIA TAYLOR KENNEDY: The silica from the husks, yes.
ARTHUR HUANG: This new material gave us a lot of freedom all of a sudden. So all of a sudden that's why I feel you no longer have to be choosing the lesser of the evils.
A lot of people argue and say, "Yes, but the silica costs a lot of energy to make."
I can argue that we definitely use way less energy than a chemical, if we add the same thing. And that is reflected in the price.
JULIA TAYLOR KENNEDY: So the argument that you just made is the one for innovation, right?
ARTHUR HUANG: Yes.
JULIA TAYLOR KENNEDY: That underlies this push towards innovation.
ARTHUR HUANG: What's funny about innovation is that all this technology is old. It's really old. If you go to this husk technology, it's 2,000 years old, 3,000 years old. The Romans used it. The Chinese used it. Let's not worry about the old things. Even in the 1960s, there was already some sort of thesis that talked about how to use husks to enhance material properties. It's already being used currently as silica fume for concrete, to add to concrete to increase structural strength. We have pens and we make concrete out of that material already.
So that's a technology innovation. But the innovation part actually comes from tweaking the old technology that's already available. We're just looking at current manufacturing technologies to do the same thing.
JULIA TAYLOR KENNEDY: It just sounds like you're moving in a million directions in a really exciting way. I'm just so glad to have the opportunity to talk to you about it. Thanks for joining me.
ARTHUR HUANG: Thank you so much.
JULIA TAYLOR KENNEDY: That was Arthur Huang, managing director of the green innovation firm MINIWIZ.
That wraps up this week's look at green energy and innovation in Asia. I'm Julia Taylor Kennedy. Thanks to Devin Stewart, Terence Hurley, and Emil Chireno for their contributions to this week's podcast.