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business newsJapan's Fukushima Disaster Creates Opportunity for Alternative Energy
With the nuclear industry reeling after the disaster, alternative energy companies may step in to fufill energy needs.
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Thousands of Japanese citizens took to the streets on Monday in Tokyo, calling on the government to reduce the country's use of nuclear power. The protests are the latest reaction to the nuclear disaster at the Fukushima Daiichi nuclear power plant, which happened after much of northeast coastal Japan was devastated by an earthquake and tsunami earlier this year on March 11.
Former Japanese Prime Minister Naoto Kan recently revealed in an interview with Kyodo News that the situation looked so bleak shortly after nuclear disaster struck the Fukushima Number One nuclear power plant that 30 million residents of the Tokyo metropolitan area faced evacuation, according to the worst case scenario in a report he received in the early days of the unfolding nuclear crisis.
After the accident at the Fukushima Daiichi nuclear power plant, radiation levels in the surrounding area spiked and many countries banned imports of Japanese food and dairy products from the Japanese prefectures near the disaster.
Japan was also hit with power shortages for months following the disaster because much of the country's oil refining capacity was taken offline by the initial damage caused by the earthquake and tsunami, while many of the country's nuclear plants were shut down as they underwent safety reviews. The Fukushima nuclear crisis is the worst nuclear accident since Chernobyl and has led many governments around the world to review the safety of their nuclear industries.
Germany made a drastic change in energy policy when German Chancellor Angela Merkel announced that Germany would close all of its nuclear power plants by 2022. German industrial and engineering company Siemens (SI) also recently announced that it was exiting the nuclear power industry in response to the Fukushima nuclear disaster.
With nuclear power being eliminated in Germany and calls for its use to be reduced in Japan, now may be a good time to consider investing in alternative fuels. Japan in particular could benefit from alternative fuels because it depends on imports for most of its energy supply. If Japan increased its use of alternative fuels, it could safeguard against the sort of energy and parts shortages that slowed the recovery of important manufacturers like Toyota Motor Corporation (TM) and Hitachi (HIT).
There are a number of options for investors to consider in the alternative energy sector. The recent collapse of Solyndra removed one competitor of more efficient Chinese solar companies like Suntech Power Holdings (STP) and Yingli Green Energy (YGE). The Chinese consider solar power to be a strategic industry and are in it for the long haul. While many traders may have seen Solyndra's fall as a bad omen for the solar energy industry, the company's Chinese competitors were probably happy to see a United States government-backed competitor go.
Investors who don't want to guess which alternative energy companies will prevail and would prefer the risk reduction offered by buying an assortment of alternative energy stocks might want to consider the PowerShares WilderHill Clean Energy (PBW) and the Market Vectors Global Alternatve Energy (GEX) ETFs. If Japan and Germany plan to use alternative energy sources for more of their energy needs, these ETFs could see their share prices climb higher.
Editor's Note: This content was originally published on Benzinga.com by Daniel James Hayden IV .
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