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The Japanese Electrical Grid: A Major Problem for Economic Recovery

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Rolling blackouts in Tokyo will make for very difficult business conditions for a long period ahead.

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Tokyo Electric Power Co. said Sunday it will resume implementing rolling blackouts partially Monday morning in the Kanto region, and depending on the demand situation for electricity, it may carry them out in the late afternoon and evening as well.

Looking at a map, Kanto is the Tokyo metropolitan area. The earthquake was 17 days ago, and the damage in the Tokyo area was not that severe. Granted, the nuclear plants are down, but Japan isn't a very big country. Why can't power be moved from the southern/western parts of Japan to Tokyo which, in my humble opinion, seems to be a pretty important part of the Japanese economy?

The answer is electrical power can't be moved for a simple, stunning reason. The northern half of Japan uses 100 volt, 50 hertz (cycles per second) electricity and the southern half uses 100 volt, 60 hertz. If you pump 60 hertz electricity into a 50 hertz system (or vice versa) you'll burn out motors and start fires. It simply cannot be done. Tokyo sits near the southern edge of the 50 hertz area and there are only four converting stations that can convert power into the other hertz. Here's a map of the country and a geographic breakdown.



The four converting plants can convert 60 hertz to 50 hertz, but their capacity is too small to alleviate the power shortage in the Tokyo area. Thus, you get rolling blackouts every business day. To make matters worse, it's spring. Power demands are lower than the summer when air-conditioning demand peaks. Trying to build new converting plants will take a long time, quite possibly years, as will any new power plants.

A quick search of global electrical systems by country seems to indicate that Japan is the only country with a split electrical grid. It's actually mind boggling. It's worse than third world. How their political system let this happen is beyond the scope of this article, but the bottom line is that Tokyo, the city, is in for a long period of very difficult business conditions that has to affect Japan's GDP. Tokyo Electric, the utility, will be under intense pressure to get back its generating capacity, and I have to believe they will try to get the "undamaged" units 5 and 6 back on line. How that plays out will be very interesting to watch. In the mean time, I'm not buying into any GDP bounce from increased construction activity when the Tokyo metropolitan area continues with rolling blackouts for months, if not a couple of years.


Lasting through April 15, 100% of the donations made to The Ruby Peck Foundation for Children's Education will be channeled to the children of Japan as they attempt to find their footing following this natural disaster; and to kick off this drive, we'll pledge $5000 to get it started. Please do what you can, as it will add up, and thanks.
No positions in stocks mentioned.

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