To a growing chorus of U.S. politicians and scientists, she is the key to whether the world will ever learn if the virus behind the devastating COVID-19 pandemic escaped from a Chinese lab. To the Chinese government and public, she is a hero of the country’s success in curbing the epidemic and a victim of malicious conspiracy theories.
Shi Zhengli, a top Chinese virologist, is once again at the center of clashing narratives about her research on coronaviruses at a state lab in Wuhan, the city where the pandemic first emerged.
The idea that the virus may have escaped from a lab had long been widely dismissed by scientists as implausible and shunned by others for its connection with former President Donald Trump. But fresh scrutiny from the Biden administration and calls for greater candor from prominent scientists have brought the theory back to the fore.
Scientists generally agree that there is still no direct evidence to support the lab leak theory. But more of them now say that the hypothesis was dismissed too hastily, without a thorough investigation, and they point to a range of unsettling questions.
Some scientists say Shi conducted risky experiments with bat coronaviruses in labs that were not safe enough. Others want clarity on reports, citing U.S. intelligence, suggesting that there were early infections of COVID-19 among several employees of the Wuhan Institute of Virology.
Shi has denied these accusations and now finds herself defending the reputation of her lab and, by extension, that of her country. Reached on her cellphone two weeks ago, Shi said at first that she preferred not to speak directly with reporters, citing her institute’s policies. Yet she could barely contain her frustration.
“How on earth can I offer up evidence for something where there is no evidence?” she said, her voice rising in anger during the brief, unscheduled conversation. “I don’t know how the world has come to this, constantly pouring filth on an innocent scientist,” she wrote in a text message.
In a rare interview over email, she denounced the suspicions as baseless, including the allegations that several of her colleagues may have been ill before the outbreak emerged.
The speculation boils down to one central question: Did Shi’s lab hold any source of the new coronavirus before the pandemic erupted? Shi’s answer is an emphatic no.
But China’s refusal to allow an independent investigation into her lab, or to share data on its research, make it difficult to validate Shi’s claims and has only fueled nagging suspicions about how the pandemic could have taken hold in the same city that hosts an institute known for its work on bat coronaviruses.
Those in favor of the natural origins hypothesis, though, have pointed to Wuhan’s role as a major transportation hub as well as a recent study that showed that just before the pandemic hit, the city’s markets were selling many animal species capable of harboring dangerous pathogens that could jump to humans.
The Chinese government has given no appearance of holding Shi under suspicion. Despite the international scrutiny, she seems to have been able to continue her research and give lectures in China.
The stakes in this debate extend into how scientists study infectious diseases. Some scientists have cited the lab leak scenario in pushing for greater scrutiny of “gain of function” experiments that, broadly defined, are intended to make pathogens more powerful to better understand their behavior and risks.
Many scientists say they want the hunt for the virus’ origins to transcend politics, borders and individual scientific achievements.
“This has nothing to do with fault or guilt,” said David Relman, a microbiologist at Stanford University and co-author of a recent letter in the journal Science, signed by 18 scientists, that called for a transparent investigation into all viable scenarios, including a lab leak.
The letter urged labs and health agencies to open their records to the public.
“It’s just bigger than any one scientist or institute or any one country — anybody anywhere who has data of this sort needs to put it out there,” Relman said.
Many virologists maintain that the coronavirus most likely jumped from an animal to a human in a setting outside a lab. But without direct proof of a natural spillover, more scientists and politicians have called for a full investigation into the lab leak theory.
Proponents of a lab investigation say that researchers at Shi’s institute could have collected — or contracted — the new coronavirus from the wild, such as in a bat cave. Or the scientists may have created it, by accident or by design. Either way, the virus could then have leaked from the laboratory, perhaps by infecting a worker.
China has sought to influence investigations into the virus’ origin, while promoting its own unproven allegations.
Beijing agreed to allow a team of World Health Organization experts to visit China but limited their access. When the WHO team said in a report in March that a lab leak was extremely unlikely, its conclusion was seen as hasty. Even the head of the WHO, Dr. Tedros Adhanom Ghebreyesus, said: “I do not believe that this assessment was extensive enough.”
Last month, President Joe Biden ordered intelligence agencies to investigate the origin question, including the lab theory. On Sunday, the leaders of the world’s wealthiest large democracies, at the Group of 7 summit, urged China to be part of a new investigation into the origins of the coronavirus. Biden told reporters that he and other leaders had discussed access to labs in China.
“Transparency matters across the board,” Biden said.
‘Scientists have a motherland.’
In less polarized times, Shi was a symbol of China’s scientific progress, at the forefront of research into emerging viruses.
She led expeditions into caves to collect samples from bats and guano, to learn how viruses jump from animals to humans. In 2019, she was among 109 scientists elected to the American Academy of Microbiology for her contributions to the field.
“She’s a stellar scientist — extremely careful, with a rigorous work ethic,” said Dr. Robert C. Gallo, director of the Institute of Human Virology at the University of Maryland School of Medicine.
The Wuhan Institute of Virology employs nearly 300 people and is home to one of only two Chinese labs that have been given the highest security designation, Biosafety Level 4. Shi leads the institute’s work on emerging infectious diseases, and over the years, her group has collected over 10,000 bat samples from around China.
Under China’s centralized approach to scientific research, the institute answers to the Communist Party, which wants scientists to serve national goals.
“Science has no borders, but scientists have a motherland,” Xi Jinping, the country’s leader, said in a speech to scientists last year.
Shi herself, though, does not belong to the Communist Party, according to official Chinese media reports, which is unusual for state employees of her status. She built her career at the institute, starting as a research assistant in 1990 and working her way up the ranks.
Shi, 57, obtained her Ph.D. from the University of Montpellier in France in 2000 and started studying bats in 2004 after the outbreak of severe acute respiratory syndrome, or SARS, which killed more than 700 people around the world. In 2011, she made a breakthrough when she found bats in a cave in southwestern China that carried coronaviruses that were similar to the virus that causes SARS.
“In all the work we do, if just once you can prevent the outbreak of an illness, then what we’ve done will be very meaningful,” she told CCTV, China’s state broadcaster, in 2017.
But some of her most notable findings have since drawn the heaviest scrutiny. In recent years, Shi began experimenting on bat coronaviruses by genetically modifying them to see how they behave.
In 2017, she and her colleagues at the Wuhan lab published a paper about an experiment in which they created new hybrid bat coronaviruses by mixing and matching parts of several existing ones — including at least one that was nearly transmissible to humans — in order to study their ability to infect and replicate in human cells.
Proponents of this type of research say it helps society prepare for future outbreaks. Critics say the risks of creating dangerous new pathogens may outweigh potential benefits.
The picture has been complicated by new questions about whether U.S. government funding that went to Shi’s work supported controversial gain-of-function research. The Wuhan institute received around $600,000 in grant money from the U.S. government, through an American nonprofit called EcoHealth Alliance. The National Institutes of Health said it had not approved funding for the nonprofit to conduct gain-of-function research on coronaviruses that would have made them more infectious or lethal.
Shi, in an emailed response to questions, argued that her experiments differed from gain-of-function work because she did not set out to make a virus more dangerous but to understand how it might jump across species.
“My lab has never conducted or cooperated in conducting GOF experiments that enhance the virulence of viruses,” she said.
‘Speculation rooted in utter distrust.’
Concerns have centered not only on what experiments Shi conducted but also on the conditions under which she did them.
Some of Shi’s experiments on bat viruses were done in Biosafety Level 2 labs, where security is lower than in other labs at the institute. That has raised questions about whether a dangerous pathogen could have slipped out.
Ralph Baric, a University of North Carolina expert in coronaviruses who signed the open letter in Science, said that although a natural origin of the virus was likely, he supported a review of what level of biosafety precautions were taken in studying bat coronaviruses at the Wuhan institute. Baric conducted NIH-approved gain-of-function research at his lab using information on viral genetic sequences provided by Shi.
Shi said that bat viruses in China could be studied in BSL-2 labs because there was no evidence that they directly infected humans, a view supported by some other scientists.
She also rejected recent reports that three researchers from her institute had sought treatment at a hospital in November 2019 for flulike symptoms, before the first COVID-19 cases were reported.
“The Wuhan Institute of Virology has not come across such cases,” she wrote. “If possible, can you provide the names of the three to help us check?”
As for samples that the lab held, Shi has maintained that the closest bat virus she had in her lab, which she shared publicly, was only 96% identical to SARS-CoV-2, the virus that causes COVID-19 — a vast difference by genomic standards. She rejects speculation that her lab had worked on other viruses in secret.
Shi’s research on a group of miners in Yunnan province who suffered severe respiratory disease in 2012 has also drawn questions. The miners had worked in the same cave where Shi’s team later discovered the bat virus that is close to SARS-CoV-2. Shi said that her lab did not detect bat SARS-like coronaviruses in the miners’ samples and that she would publish more details in a scientific journal soon; her critics say she has withheld information.
“This issue is too important not to come forward with everything you have and in a timely and transparent manner,” said Alina Chan, a postdoctoral research fellow at the Broad Institute of MIT and Harvard who also signed the Science letter.
Many scientists and officials say China should share employees’ medical records and the lab’s logs of its experiments and its viral sequence database to evaluate Shi’s claims.
Shi said she and the institute had been open with the WHO and with the global scientific community.
“This is no longer a question of science,” she said on the phone. “It is speculation rooted in utter distrust.”
‘I have nothing to fear.’
The pandemic was a moment that Shi and her team had long braced for. For years, she had warned of the risks of a coronavirus outbreak, building up a stock of knowledge about these pathogens.
In January 2020, as Shi and her team worked frantically, they were exhausted but also excited, said Wang Linfa, a virologist at the Duke-National University of Singapore Medical School who was in Wuhan with Shi at the time.
“All the experiences, reagents and the bat samples in the freezer were finally being used in a significant way globally,” said Wang, Shi’s collaborator and friend for 17 years.
Shi published some of the most important early papers on SARS-CoV-2 and COVID-19, which scientists around the world have relied on.
But soon, the speculation about Shi and her lab began to swirl. Shi, who is known among friends for being blunt, was baffled and angry — and sometimes let it show.
In an interview with Science magazine in July, she said that Trump owed her an apology for claiming the virus came from her lab. On social media, she said people who raised similar questions should “shut your stinky mouths.”
Shi said what she saw as the politicization of the question had sapped her of any enthusiasm for investigating the origins of the virus. She has instead focused on COVID-19 vaccines and the features of the new virus, and over time, she said, has calmed down.
“I’m sure that I did nothing wrong,” she wrote. “So I have nothing to fear.”
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Sydney outbreak a ‘national emergency’ as cases spike
Sydney – Sydney’s fast-growing coronavirus outbreak has become a “national emergency,” state leaders said Friday, as Australia’s largest city reported another record number of new infections.
Admitting a monthlong lockdown had so far failed to stop a delta-variant outbreak, the state of New South Wales pleaded for Canberra to urgently send more vaccines and resources.
Declaring the outbreak a national emergency could pave the way for more federal government involvement in stemming the crisis.
“We have an obligation on behalf of the nation to contain the virus,” said New South Wales premier Gladys Berejiklian. “There is no doubt that the numbers are not going in the right direction.”
Her state on Friday reported 136 new cases, a record for this outbreak, which now totals 1,782.
With the virus “spreading everywhere” and half the country’s 25 million people currently in lockdown, Berejiklian said the government must “refocus” its glacial vaccine rollout.
Just 12% of Australians have been fully vaccinated, thanks to problems with supplies of Pfizer jabs and scepticism about the safety of the AstraZeneca vaccine.
“We need, at least, more first doses of Pfizer,” Berejiklian said, while warning Sydney’s 5 million residents that restrictions could run until October.
She also announced nonessential workers in specific areas of Sydney would now be barred from leaving, tightening a lockdown that is almost certain to be formally extended next week.
“It is fairly apparent that we will not be close to zero (cases) next Friday,” Berejiklian said. “We will have a clearer view next week on what August, September, and October look like.”
Prime Minister Scott Morrison on Thursday apologized for the country’s slow vaccine rollout, admitting targets had not been met.
“I take responsibility for the vaccination program. I also take responsibility for the challenges we’ve had,” he said. “Obviously, some things are within our control, some things that are not.”
With Sydney cases spiraling, the premier of Victoria state, Dan Andrews, called for a “ring of steel” to be thrown up around the city, banning any travel in or out.
In New Zealand, Prime Minister Jacinda Ardern announced a travel bubble between the two countries would be suspended for at least eight weeks.
Australians will no longer have quarantine-free entry to New Zealand, while return flights would be arranged for New Zealanders in Australia.
“There are now multiple outbreaks, and in differing stages of containment, that have forced three states into lockdown,” Ardern said.
“The health risk to New Zealanders from these cases is increasing … now is the time for a suspension to ensure New Zealanders aren’t put at undue risk from COVID-19 and to ensure we retain our hard-won gains.”
Quarantine-free travel between New Zealand and Australia began in April after more than a year of closed borders and was hailed by tourism operators as a “savior for businesses”.
However, New Zealand has several times since halted the bubble with individual states and territories as outbreaks erupted in Australia.
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China urged to stop forcibly returning North Korean defectors
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Human rights activists have urged Beijing to stop repatriating North Korean refugees over fears that more than 1,000 people detained in China could be tortured by Kim Jong Un’s security officials.
At least 1,170 North Koreans are detained in China, including 450 men in a prison in Changchun, a city in north-eastern Jilin province, according to Human Rights Watch.
Just two defectors arrived in South Korea in the second quarter of the year, a record low and following 229 in all of 2020, according to Seoul’s Ministry of Unification. That is down from more than 1,000 in 2019 and close to 3,000 in 2009.
The criticism of Beijing also followed a report by Radio Free Asia that China repatriated about 50 North Koreans this month. The report has not been independently confirmed by the Financial Times.
The event would have probably marked the first case of mass forced returns since January 2020, when North Korean authorities instituted sweeping crackdowns on trade and travel in response to the risk of Covid-19 transmission from China.
“China is obligated not to force back anyone who would be at risk of persecution or torture upon return,” said Lina Yoon, a researcher at Human Rights Watch, noting that Beijing was a party to UN conventions to protect refugees and prevent torture.
“Since anyone who returns to North Korea after fleeing will likely be tortured or otherwise mistreated, all have a claim for refugee status in whichever country they reach,” she said.
The long-term decline in the number of escapers reflects harsher security procedures imposed in the borderlands of North Korea and China following the rise to power of Kim Jong Un and Xi Jinping.
Beijing has long been wary of the risks of destabilisation in North Korea, which could cause a flood of refugees across its 1,352km border with the nuclear-armed state.
Estimates of the number of North Koreans in China range upwards from 50,000. Many defectors live in China for years, some paying off debts, before they venture to south-east Asia, where they can be accepted and processed through South Korean embassies.
But experts who help defectors reach safety said Beijing’s increasingly strict controls on internal movement and the uptake of technological surveillance had created new risks.
The number of brokers willing to assist North Korean defectors has also fallen, a sign of the effectiveness of the crackdown on both sides of the border.
Pyongyang has not reported a single coronavirus infection since the start of the pandemic. North Korean observers remain uncertain about the likelihood of any near-term vaccination programme despite mounting signs of a severe economic downturn and worsening humanitarian situation in the country.
North Korea could access Oxford/AstraZeneca jabs via the Covax programme under Gavi, a UN-backed alliance, but foreign experts have not gained access to the country to assess the status of its distribution networks.
Some experts expect trade flows with China might slowly pick up over the coming months via new, highly controlled disinfection zones near Sinuiju, North Korea’s main road artery with Dandong in north-eastern China.
Troubled Tokyo Olympics to open under Covid cloud
The most troubled Olympics in modern history finally open in Tokyo on Friday, struggling to shake off lingering virus fears after a one-year postponement and a build-up marred by scandal and controversy.
Eight years after Japanese newscasters shed tears as Tokyo celebrated winning the right to stage the Games, Friday’s opening ceremony will take place before empty stands and with the city in a state of emergency.
Fears that the global gathering of 11,000 athletes could trigger a super-spreader event have prompted organizers to clamp the Games in a biosecure straitjacket.
Overseas fans are banned for the first time ever and domestic spectators will be kept out of all but a handful of venues.
Athletes, support staff and media are subject to strict Covid-19 protocols, including regular testing and daily health checks.
Polls have consistently found a majority of Japanese are against the Games, with opinion ranging from weary indifference to outright hostility.
But in the hours before the opening ceremony, there were glimmers of excitement building, with thousands turning out in Tokyo to watch an aerial display by the Japanese air force’s Blue Impulse team.
“Before the Olympics began I expected the atmosphere to be a little sad,” said Maki Hasumoto, 25, as she waited for the display.
“But now it’s very atmospheric and now I’m looking forward to it.”
Friday is a national holiday in Japan and families set up picnic blankets in Tokyo parks to watch the jets draw the Olympic rings in coloured smoke.
“It’s impressive here. It really feels like the Olympics is going to start,” added 38-year-old Megumi Taguchi.
Nearby, locals patiently lined up in the heat to take photos in front of the Olympic rings mounted next to the stadium that will host this evening’s opening extravaganza.
Traditionally a highlight of any Summer Games, featuring the parade of nations and the lighting of the Olympic cauldron, Tokyo’s opening ceremony will be drastically pared back.
Fewer than 1,000 dignitaries and officials will be present at the 68,000-seat stadium when events get under way at 8pm local time.
Most world leaders have opted to stay away, though US First Lady Jill Biden and French President Emmanuel Macron – whose country will host the 2024 Paris Olympics – will be in the stands along with Japan’s Emperor Naruhito.
But in a sign of how divisive the Games remain, several top sponsors including Toyota and Panasonic will not be sending executives.
A few hundred protesters demonstrated against the Games on Friday morning near the Tokyo government building where Governor Yuriko Koike welcomed the Olympic flame.
“Even though the pandemic continues, we will hold a safe and secure Games,” Koike said.
“We are determine to see it through. Today is the first step towards that.”
Tokyo is battling a surge in virus cases, and is under emergency measures that means bars and restaurants must shut by 8pm and cannot sell alcohol.
Dogged by controversy
But Olympic officials have put a brave face on the unusual circumstances, with IOC chief Bach insisting cancellation was never on the table.
“Over the past 15 months we had to take many decisions on very uncertain grounds,” he said this week. “We had doubts every day. There were sleepless nights.
“We can finally see at the end of the dark tunnel. Cancellation was never an option for us. The IOC never abandons the athletes … we did it for the athletes.”
There are also hefty financial incentives in play. Insiders estimate the IOC would have been on the hook for about US$1.5 billion in lost broadcasting revenues if the Games had been cancelled.
The pandemic has not been the only hiccup in preparations though, with scandals ranging from corruption during the bidding process to plagiarism allegations over the design of the Tokyo 2020 logo.
The controversies kept coming right up to the eve of the Games, with the opening ceremony’s director sacked on Thursday for making a joke referencing the Holocaust in a video from 1998.
Back in the sporting arenas, a new generation of Olympic stars are looking to shine after a decade dominated by the likes of Usain Bolt and Michael Phelps.
US swimmer Caeleb Dressel could target seven gold medals, and in track and field, 400-meter hurdlers Karsten Warholm of Norway and the USA’s Sydney McLaughlin are among those hoping to emerge as household names.
Gymnastics, meanwhile, will see Simone Biles attempt to crown her dazzling career by equalling Larisa Latynina’s record of nine Olympic gold medals.
New Olympic sports will also be on display in Tokyo, with surfing, skateboarding, sport climbing and karate all making their debut.
Japan faces heat over Bangladesh’s coal power
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Some 4,000km from Japan, on a verdant, mangrove-lined island in south-eastern Bangladesh, sits one of the biggest and most controversial tests of Tokyo’s commitment to help phase out fossil fuels.
Thanks to low-interest loans from the Japan International Cooperation Agency, Bangladesh is currently building the Matarbari coal plant: a power complex set to be completed by 2024. And JICA, a government body, has been considering funding an expansion to the 10-year-old project, known as Matarbari Phase 2 — despite, earlier this year, saying it would work with Bangladesh “to promote a low- or zero-carbon transformation” of its energy economy.
This debate around the Matarbari plant embodies the tensions in Japan’s fossil-fuel policies. Its financing of coal power in developing countries risks falling out of step with moves to promote renewable energy at home and abroad.
In Bangladesh — a low-lying country highly vulnerable to the effects of climate change, such as rising sea levels and erratic rainfall — the government of prime minister Sheikh Hasina has been backing coal to meet energy needs.
However, official enthusiasm for mega-projects such as Matarbari is waning as renewable alternatives become cheaper. Hasina’s government last month scrapped 10 of the coal-power plants it had planned. While the mooted Matarbari Phase 2 project was not officially among them, analysts say it is looking less and less viable.
“Now, [Bangladesh’s] focus is more pro-renewables, and [it] seems to be turning away from coal,” says Simon Nicholas, an analyst with US think-tank the Institute for Energy Economics and Financial Analysis (IEEFA). “That’s more economics than anything else.” Bangladesh says it wants to generate 40 per cent of its power from renewable energy within 20 years.
Japan has long invested in Bangladeshi infrastructure, a partnership that stems back nearly as far as the South Asian nation’s independence 50 years ago. But JICA’s support for the Matarbari units has faced severe censure.
“Japan has no right to invest in coal in other countries — they have a responsibility to ensure zero emissions,” argues Hasan Mehedi, an activist with the Bangladesh Working Group on External Debt, which opposes the project. Japan is “making money . . . transferring pollution to other countries so that they can phase themselves clean,” Mehedi says.
Within Japan, too, there is belated recognition that its support for overseas coal plants has become anachronistic.
Until recently, its suppliers of coal-fired boilers and turbines were regarded as the kind of strategic national industry the country had a duty to support. Now, it has realised that there is little future in coal. That prompted a big shift in policy last year, when Japan adopted a presumption against new coal projects overseas. Banks began to question whether coal financing was worth the international opprobrium.
“There are very few possibilities for Japanese industry to export coal power plants,” says University of Tokyo professor Yukari Takamura, who was part of a government expert panel on the topic. She adds that “almost all Japanese banks have now said they will not finance new coal plants overseas.”
While there is some ambiguity about official Japanese policy — there is still no clear ban on coal projects overseas — the government made its strongest commitment yet at last month’s G7 summit in the UK: agreeing to halt all new direct government support for unabated coal power generation abroad by the end of 2021 (that is, plants that do not capture the carbon dioxide they produce).
That has left a few pipeline projects, including Matarbari Phase 2, in a no man’s land. They now run against official policy, but commitments were made. JICA says that preparatory surveys are continuing.
Local attitudes towards the Matarbari project, about 40 miles from Bangladesh’s second-largest city Chattogram, are polarised.
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Supporters have touted its job-creating potential, but critics accuse it of displacing residents and polluting the adjacent Kohelia river. Sharif Jamil, of environmental group Bangladesh Poribesh Andolon, says locals complain that construction contractors are bringing in workers from outside areas. They had hoped “the area will be developed like Singapore,” he says. “But now the myth has gone.”
IEEFA’s Nicholas argues that such projects will exacerbate Bangladesh’s power overcapacity, with utilisation of the power system currently around 40 per cent. He thinks the country should instead upgrade its grid to make better use of its existing electricity supply and to meet its renewable energy targets.
“Until recently, Bangladesh was expected to be one of the key growth markets for seaborne thermal coal,” he says. “The potential growth markets around Asia — that were supposed to replace Japan, South Korea and China as they shift away from thermal coal imports — increasingly look like they will disappoint the coal industry.”
Additional reporting by Robin Harding
Sun fails to shine on Japan’s solar sector
It was a speech to inspire environmentalists and energy investors. Addressing both houses of Japan’s parliament last October, new prime minister Yoshihide Suga vowed to make a “green society” a core focus of his government. Among the most promising technologies for bringing this about, he said, would be solar power.
The problem — even as he made the announcement and sent bureaucrats scrambling to create the programmes to make it happen — was Japan’s growing list of solar company failures.
And while shifts in government policy have played a part in these, some analysts see a more worrying dynamic: the possibility that the economics of solar power in Japan reveal a serious threat to its sustainability plans.
Between the start of 2018 and the end of 2020, 256 solar companies were forced to declare bankruptcy, according to business information firm Teikoku Databank. Their failure, surviving competitors say, reflects a far more challenging operating environment than many had ever predicted.
The rate of new bankruptcies currently appears to be falling, but analysts at Tokyo Shoko Research note that last year the total debt of bankrupt solar companies almost doubled from 2019 levels — reaching a record ¥46bn ($415m). They suggest that emergency Covid-19-related subsidies may be masking the full extent of the crisis.
“Businesses supported by financial assistance may be ‘short of breath’, and the number of bankruptcies in 2021 may increase,” the analysts warn.
Generous to a fault
The most common explanation given for the business failures is the sharp pullback by Japan on a renewable energy scheme conceived a decade ago in the aftermath of the 2011 earthquake and tsunami, and the subsequent closure of the country’s nuclear reactors.
One highlight of this new policy, which aimed to encourage investment in solar energy, was a system of subsidies in the form of feed-in tariffs (FITs) — agreed prices at which electricity would be bought from solar providers, in order to reduce investment risk.
The initial generosity of the FITs when launched in 2012 had the desired effect. Hundreds of investors and operators concluded that by locking in those tariffs at a time when solar equipment costs were falling fast and land in Japan was relatively cheap their potential pay-off far outweighed their risk.
However, in some areas of Japan, particularly the sunny southern island of Kyushu, the sudden concentration of new solar farms led to summer generation surpluses and periodic exclusions from the grid.
So, after about a year, the government started cutting the FITs. It also introduced retroactive deadlines for plants licensed before the tariff cuts to begin operations.
For many companies, these FIT reductions meant their profitability calculations no longer worked. They also seemed to jar with the government’s stated objective of building a thriving alternative energy industry.
Taishi Sugiyama, a research director at the Canon Institute for Global Studies think-tank and an expert on Japan’s alternative energy industries, argues that the FIT scheme was “too generous”. “At one point, it was the most expensive solar generation in the world,” he says. “The government changed the policy to reduce the costs following a lot of criticism. Once the FIT rates were decreased, it was quite natural that some generators went into bankruptcy.”
Older and costlier
Nathan Schmidt, a partner at Japanese law firm Nishimura & Asahi who has worked extensively on alternative energy projects, says the FITs were always intended to taper, and most investors should have known that.
But a less predictable problem, he says, is that the cost of building and running solar projects in Japan has not fallen as quickly as it has in other countries — where investors’ lower outgoings have offset falling FIT rates.
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This cost issue stems from Japan’s demographics: with more than 28 per cent of its population aged over 65, Japan is the “oldest” country in the world and has lower unemployment than many big economies.
As a result, Japan’s solar energy companies — and other industries serving Suga’s “green society” — face stiff competition for labour and specialists, pushing up pay.
For some operators, the change in FITs has pushed them towards other alternative energy sources.
Ryota Suzuki, director of operations for renewables group Renova, says that the company took advantage of the early FITs and locked in reliable revenues for at least 13 years, but it has no further plans for solar projects in Japan. It will concentrate on biomass, wind and geothermal projects instead.
Others have taken a more aggressive approach to Tokyo’s policy shift, echoing the way some Japanese firms took on the Spanish government when it also reduced FIT rates more quickly than expected in the 2010s. One Hong Kong-based investor, Shift Energy, is making the first-ever use of a 24-year-old bilateral investment treaty to lodge an arbitration claim against Japan.
The case centres on the claim that government policy exposed investors to unreasonable risks.
Japan battled hard but unsuccessfully to settle the matter without formal arbitration. Lawyers warn that, should Shift Energy be successful, the door would be opened for many others to attempt a similar claim.
Tokyo’s troubled Games offer taste of problems to come
After record-breaking rainfall, and with just three weeks to go before the opening ceremony of the Tokyo Olympics, Japan watched in horror as entire buildings were washed down the hillsides of the popular tourist town of Atami.
The landslides, which claimed 18 lives and left 10 missing as they swept through residential streets, took place about an hour’s drive outside the Japanese capital. And the ruined town is just a few kilometres from the mountain bike course where Olympians will compete next week.
The Atami deluge came during a fortnight when hundreds of thousands of people were evacuated from their homes as rainfall records were broken in eight of Japan’s 47 prefectures, including Tokyo.
Now, Japanese climate change experts say the time has come for more resources to be channelled into improving forecasting, and for sporting events to be organised around the increasing likelihood of extreme weather. Tokyo’s Olympics, in this light, may be a turning point for interactions between large-scale event planning and the effects of climate change.
“My impression is that, even now, event planners do not take enough notice of the risk of extreme weather events, but will have to start to do so,” says Yu Kosaka, a climate change specialist at the University of Tokyo’s Research Center for Advanced Science and Technology. She predicts that heatwaves and torrential downpours will become more common.
Although research may give Japanese forecasters a better grasp of the likelihood of such catastrophes, Kosaka says, big sports events should start building more flexibility into their location and timing as a matter of course.
Changes of plan
Even before the deluge of July 2021, the Tokyo Olympics had become a powerful symbol of how human plans — even those as big, expensive and grandiose as the Olympic Games — are vulnerable to nature.
In November 2019, despite claiming in its bid documents that Tokyo in July was “mild”, Olympic organisers reluctantly moved the showcase marathon from Tokyo to the cooler city of Sapporo in the far north.
The much-debated decision followed the temperature in central Tokyo hitting its highest ever recorded level in the previous July and doctors warning about the consequences for runners.
That was a significant compromise, but it was eclipsed by the decision in March 2020 to postpone the Games as the world confronted a pandemic for which, at the time, it saw no end.
The Japanese government’s decision this year to press ahead with the Games is not popular. More than 50,000 athletes, coaches, officials and support staff will descend on Japan at a time when it has double-vaccinated only a small percentage of its population against Covid-19 and infections in Tokyo continue to rise.
Further compromises have also been necessary to keep the Games viable. These include decisions to bar spectators from almost all events, to hold the final stages of the torch relay off public roads, and to make athletes and teams submit to tight restrictions and constant infection testing.
Expect the unexpected
Medical experts say that planners of the Olympics and other mass sporting events need to view the hosting of the Tokyo games in the correct perspective: not as a one-off triumph of determination, but simply the first of many organisational challenges in a Covid era that could last for years.
“It depends on the size of the mass gatherings but such events will, in the future, all have to be held with consideration of infection control and the risk of disease outbreak,” warns Yasutaka Mizuno, who is a director of Tokyo’s Global Healthcare Clinic and an expert in epidemics.
In an interview with the FT, the president of the International Olympic Committee, Thomas Bach, described the Tokyo Games as the “most complex and difficult ever”, because there is no blueprint for ensuring the safety of athletes.
“When we decided about the postponement, I’m happy now with hindsight that we did not know how difficult it would be — because, then, we may have had second thoughts,” he said.
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But even if or when the pandemic subsides, such complexity will be the norm for such events, says Hisashi Nakamura, deputy director at Japan’s Climate Science Research Laboratory at the University of Tokyo.
Consideration of global warming and its many potential effects will have to be treated as standard elements in the planning process.
More computing power, Nakamura argues, must be thrown into forecasting models in order to boost their resolution and to help maximise organisers’ preparedness.
“As we have seen, planners need to see extreme events coming,” he says.
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