EGPA2013 PSGI KUDO

1

2013 EGPA Annual Conference

11-13 September, Edinburgh, Scotland

Permanent Study Group I:

Information and Communications Technologies in Public Administration

“Quality of Life” and “resilience”

Japanese smart city projects after the 3.11 Great East Japan Earthquake

Paper by:

Prof.Dr.Hiroko Kudo

Professor, Faculty of Law, Chuo University, Japan

Visiting Professor, Faculty of Economics, Law and Political Sciences, University of

Cagliari, Italy

742-1, Higashi-nakano, Hachioji, Tokyo, 192-0393, JAPAN

Tel: +81 426 74 3194, Fax: +81 426 74 3133

E-mail: hirokokd@tamacc.chuo-u.ac.jp

EGPA2013 PSGI KUDO

2

Abstract:

Promoted by the Ministry of Economy, Trade and Industry (METI) between 2009 and

2010, “Smart Grid, Smart Community” proposal took shape in four Japanese territories

as “Next-Generation Energy and Social System Demonstration Areas (smart city

projects) in April 2010. Since then, these areas have been engaged in various

experiments. The METI called for organizations for creating master plans using the

“Subsidy for Projects Promoting the Introduction of Smart Communities (FY 2011

Third Supplementary Budget)” and selected eight local governments in the Tohoku

region. Since April 2012, these cities have been working on the project along with the

original four areas.

Smart cities are a new style of city providing sustainable growth and designed to

encourage healthy economic activities that reduce the burden on the environment while

improving the quality of life of their residents. In the aftermath of the Great East Japan

Earthquake that struck on March 11, 2011, and the subsequent nuclear power plant

accident, there is even more demand for “resilience” in these days.

Urbanization is a global issue at the moment. Infrastructures, involving energy, water,

buildings, transportation, communications, and public services, are indispensable to

ensure people’s life and businesses. At the same time, the existing infrastructures in

developed countries are ageing that they no longer meet the requirements of modern

lifestyles, and they need to be completely revised in the near future. In addition,

developed countries are facing other social issues, such as aging society, shrinking

population, and tax revenue decrease.

Following the same old methods to improve the quality of life of residents and vitalize

economic activities, while solving the urban issues, is no longer a viable option from the

point of view of function and cost. It also goes without saying that reducing the burden

on the environment through cutting back on CO2 emissions is an important prerequisite.

The reason of promoting smart cities is in their bid to adopt recyclable energy sources

through the use of solar power and wind power, etc.

The active employment of ICT (Information and Communications Technology) will

provide smart cities with the means to solve these problems. Establishing smart cities is

not merely a question of changing appearance of urban areas; it is a quest to bring

innovation to the lifestyles of the residents themselves.

A large number of experiments are currently being carried out around the globe in order

to discover a core model for smart cities. In Japan, there are four since 2010, plus eight

areas in the region hit by the 2011 Earthquake since 2012. Each of these projects is

varied and diverse, with some considering energy and others considering electric

EGPA2013 PSGI KUDO

3

vehicles. The main aim is, however, to consider the lifestyles of the citizens, which in

the end will determine the form of the cities. Smart cities have been promoted by the

governments, private corporations, and residents.

The paper analyses first the proposals and projects promoted by the METI through

official documents and materials of the proposing commission, then the four pilot

projects, in particularly that of Kitakyushu City. Finally it concludes with several

observations and recommendations on the role of private sector and the citizen on this

regard.

Keywords

smart city, smart community, pilot project, ICT, resilience

Introduction

“Smart Grid, Smart Community” proposal took shape in four Japanese territories as

“Next-Generation Energy and Social System Demonstration Areas (smart city projects)

in April 2010. Since then, these areas have been engaged in various experiments.

The Ministry of Economy, Trade and Industry (METI) called for organizations for

creating master plans using the “Subsidy for Projects Promoting the Introduction of

Smart Communities (FY 2011 Third Supplementary Budget)” and selected eight local

governments in the Tohoku region. Since April 2012, these cities have been working on

the project along with the original four areas.

Smart cities are a new style of city providing sustainable growth and designed to

encourage healthy economic activities that reduce the burden on the environment while

improving the quality of life of their residents. In the aftermath of the Great East Japan

Earthquake that struck on March 11, 2011, and the subsequent nuclear power plant

accident, there is even more demand for “resilience”.

Following the same old methods to improve the quality of life of residents and vitalize

economic activities, while solving the urban issues, is no longer a viable option from the

point of view of function and cost. It also goes without saying that reducing the burden

on the environment through cutting back on CO2 emissions is an important prerequisite.

The reason of promoting smart cities is in their bid to adopt recyclable energy sources

through the use of solar power and wind power, etc.

The active employment of ICT (Information and Communications Technology) will

provide smart cities with the means to solve these problems. Establishing smart cities is

not merely a question of changing appearance of urban areas; it is a quest to bring

EGPA2013 PSGI KUDO

4

innovation to the lifestyles of the residents themselves.

A large number of experiments are currently being carried out around the globe in order

to discover a core model for smart cities. In Japan, there are four since 2010, plus eight

areas in the region hit by the 2011 Earthquake since 2012. Each of these projects is

varied and diverse, with some considering energy and others considering electric

vehicles. The main aim is, however, to consider the lifestyles of the citizens, which in

the end will determine the form of the cities. Smart cities have been promoted by the

governments, private corporations, and residents.

1. “Smart Community” project and the impact of 2011 East Japan Earthquake

The first series of project related to smart city and/or smart community started in 2010.

“Demonstration of Next-Generation Energy and Social Systems” is a program

positioned as an initiative to promote the construction of a Japanese-version smart grid

and its introduction overseas, which are set as goals in the government’s growth strategy,

under the topic of “strategy for becoming an environment and energy power through

green innovation.” (METI, 2010a)

The Ministry of Economy, Trade and Industry (METI) called for project proposals to

select areas to conduct demonstrations of next-generation energy and social systems.

Municipal governments, energy companies, companies engaged in the construction of

energy management systems were eligible to propose projects and projects, mainly

focusing on demonstrations of energy management systems, including those involving

demonstrations of transportation and lifestyle innovations, were the type of projects

expected.

The submitted proposals were reviewed in consideration of the opinions of experts in

the Conference on the Next-Generation Energy and Social System. Proposals were

especially reviewed from the following issues:

ambitious targets for energy savings and CO2 emissions reduction, and large-scale

deployment of renewable energy;

establishment of an energy management system for each site of energy

consumption and at a regional level;

establishment of a complementary relationship between regional energy

management and a large-scale networks;

efficient use of energy in a transport system that includes next-generation vehicles

and railways;

participation of not only the local government but also energy-related companies,

EGPA2013 PSGI KUDO

5

system manufacturers, and other users (households, buildings, commercial facilities,

etc.) exceeding the specified number;

lifestyle innovation, etc..

In order to review the proposals, interview with the applicant were conducted and they

were given scores by experts of the Next-Generation Energy and Social System

Committee. As a result, Yokohama City, Toyota City, Kyoto Prefecture (Kansai Science

City,) and Kitakyushu City were selected as “Next-Generation Energy and Social

System Demonstration Areas”. These areas had to develop their master plans based on

their proposals, while taking into account the discussions at the Conference on the

Next-Generation Energy and Social System.

From the above mentioned features, it is clear that the original projects of small city and

small community

The project outlines of these selected areas are the following. The paper later

concentrates on the case of Kitakyushu City in Chapter 2.

1.1. Yokohama City, Kanagawa Prefecture

The project for this area was promoted by Yokohama City Government and the

following private companies; Accenture, Toshiba, Nissan Motor, Panasonic, Meidensha,

Tokyo Electric Power, and Tokyo Gas.

Yokohama City is the biggest municipality in Japan with its 3.7 million inhabitants1 and

it the capital city of Kanagawa Prefecture, southwest to Tokyo. The area is characterised

by intensive presence of industries and has the characteristics of residential area for

many commuters to Tokyo.

Proposal included the following issues:

construct a new social system by bringing together in Yokohama the wisdom of

companies for reducing CO2 emissions and increasing national wealth and promote

its deployment overseas. In doing so, make the utmost use of Yokohama’s excellent

assets and opportunities, such as civic power, diverse geographical features, and

APEC meetings;

to make the project sustainable, construct a system in an existing urban district

where people actually live;

establish an entity responsible for overall decision making, investments, and

publicity to organize a promotional structure involving energy companies and users;

seek to reduce CO2 emissions by 30% by 2025 compared to the 2004 level.

The following actions had to be taken in three major districts, including Minato Mirai

1 Data of 1st August 2013, according to Yokohama City Administration.

EGPA2013 PSGI KUDO

6

21 in waterfront area:

large-scale deployment of renewable energy (27,000 kW photovoltaic system);

introduction of smart house/building technology (at 4,000

households/establishments);

coordinated control of regional energy (e.g., electricity, heat) complementary to a

large network;

diffusion of the next-generation transport system (2,000 next-generation vehicles);

lifestyle innovation through visualization;

enhanced promotional structure through the establishment of a business alliance.

1.2. Toyota City, Aichi Prefecture

The project was proposed by Toyota City Government, Toyota Motor, Denso, Chubu

Electric Power, Toho Gas, Sharp, Toyota Home, Fujitsu, Toshiba, KDDI, Circle K

Sunkus, Mitsubishi Heavy Industries, Toyota Industries, and Dream Incubator.

The city is an industrial city and a company town, with headquarter of Toyota Motor.

The city is situated southeast to Nagoya City, the capital city of Aichi Prefecture. Its

population is 422 thousands2 and many households work with the major industry of the

city. Thus, this proposal has many characteristics unique to this area.

Proposal outlined the followings:

focus on the household sector (homes and cars) and aim to construct a low carbon

social system through joint efforts of global companies, leading local firms, and the

local government in cooperation with consumers;

demonstrate the efficient use of a mix of different energy sources (electricity, heat

and unused energy) and the construction and linkage of low carbon transport

systems, while restricting social costs;

make standardization and other efforts emphasizing international competition and

the construction and linkage of low carbon transport systems, while restricting

social costs;

make standardization and other efforts emphasizing international competition;

seek to reduce CO2 emissions by 20% in households and 40% in transport.

Planned actions included:

efficient use of energy in households (70 or more households);

efficient use of energy based on communities;

establishment of a low-carbon transport system (diffusion of 3,100 next-generation

vehicles);

2 Data of 1st June 2013, according to Toyota City administration.

EGPA2013 PSGI KUDO

7

lifestyle innovation through support to encourage consumers to change their action

patterns and verification of its effect as an incentive (to reduce social costs);

development of strategy for global deployment (global deployment and

international standards).

1.3. Kansai Science City, Kyoto Prefecture

This proposal has many differences in its composition of the promoters, in its

characteristics of the territory, in its objectives and thus in its project. The project is

proposed by Kansai Research Institute, Doshisha Yamate Sustainable Urban City

Council, Kyoto Prefecture, Kyotanabe City, Kizugawa City, Seika Town, Kansai

Electric Power, and Osaka Gas. The area is well-known with its nickname “Keihanna”

in Japan.

The area had developed as research and development hub and the project was based on

this territorial characteristics. The very first idea to create a culture and science hub was

proposed in the Seventies, while the major concrete projects started in mid-Eighties

with many universities moving into the area. Between 2005 and 2007, many industries

moved into the area, thanks to various deregulation on industrial zoning. The whole area

develops on a vast territory between Oosaka, Kyoto, and Nara Prefecture and has 230

thousands inhabitants, 80 thousands of them living in the Science City.

Proposal had the following issues:

control energy by visualizing energy flows in homes and offices as well as those

through Electric Vehicles (EV, a “nano-grid” project) in Kansai Science City, which

aims to study and demonstrate sciences for a sustainable society and create new

industries based on them,

by doing so, confine fluctuations in demand arising from human activity patterns

and the instability of natural energy sources, and aim to establish a stable and

efficient regional energy system and create new industries;

seek to reduce CO2 emissions by 20% in households compared to the 2005 level

and 40% in transport by 2030.

And the actions planned to this are were:

installation of photovoltaic systems in 1,000 households;

building “nano-grids” in homes and buildings to intelligently control power

generation systems (e.g., solar cells, fuel cells) and electrical storage systems

through “computerized” management of energy;

active deployment of EVs and construction of a network of charging stations;

proposal of a regional energy economy model based on “Kyoto eco-points”;

EGPA2013 PSGI KUDO

8

establishment of a model for local energy production for local consumption by

integrating the above actions

experiments to demonstrate complementarities between a regional nano-grid and

the national grid.

Given the characteristics of the territory, this proposal has uniqueness as noted above.

1.4. Kitakyushu City, Fukuoka Prefecture

This project was proposed by Kitakyushu City Government, Nippon Steel, IBM Japan,

and Fuji Electric Systems.

Kitakyushu City is located in an historical industry area and an historical company town.

It has about 970 thousands inhabitants3 and is developed on a vast area of 500 square

kilometres. It has hosted since 1901 the very first Japanese steel works (Yawata Steel

Works was a public company, then became Nippon Steel), on which the city relies its

development. After the successful overcome of the territory from typical pollution and

issues related to coal mining, fossil-fuel power station, and steel works, the territory

launched eco-friendly, eco-driven, eco-related, and ecological industries. It became one

of the first cities to host landfill sites as well as factories for the recycling of consumer

electronics. The city used to rely on heavy industry, however has been successfully

converting into green economy.

As a former industrialised city, it suffers the aging society and issues including

renovation of infrastructure, etc.

These characteristics result in its proposal as follows:

aim for regional energy management in which citizens and all other community

members participate, by building a smart grid based on the local new energy

infrastructure (solar power, hydrogen, etc.) and community infrastructure of the

Yahata Higashida district, which has been pursuing an eco-friendly community

under the leadership of the private sector, and eventually create a society with 50%

less CO2 emissions;

disseminate the outcome across the city by incorporating it in the city’s community

development policy and expand it to Asia through networking with other Asian

cities;

seek to achieve, in addition to the current target of reducing CO2 emissions by 40%

by 2030 and 70% by 2050 in the residential/commercial and transport sectors), an

additional 10% reduction (80% reduction instead of 70% by 2030, 80% reduction

instead of 70% by 2050).

3 Data of 1st August 2013, according to Kitakyushu City administration.

EGPA2013 PSGI KUDO

9

The plan includes the following actions:

creation of a city block where new energy, including that from industry, accounts

for 10% of energy consumption;

deployment of energy conservation systems for an entire town (e.g., real-time

energy management for 70 companies and 200 households using smart meters);

city block energy management through a regional energy saving station;

development of communities and transport systems based on energy infrastructure;

establishment of a system to transfer the outcomes to other parts of Asia.

Kitakyushu City has collaborated with various cities and area in Southeast Asia for

technology and knowledge transfer related to prevention of pollution and eco-friendly

and eco-related industries.

In August 2010, the selected areas were asked to present their master plan for the project

(METI, 2010b) and elaborated them with external experts provided by the Ministry.

Most of the projects remained within the original proposals.

The paper deals with the case of Kitakyushu City later in Chapter 2.

[Figure 1: Concept of Smart Community]

EGPA2013 PSGI KUDO

10

(source: Ministry of Economy, Trade and Industry, 2010a)

1.5. Impact of East Japan Earthquake

After the first period of these projects, METI worked on a series of feasibility study

abroad of smart city and smart community between 2011 and 2013 (METI, 2011, 2012,

2013). However the project had been influenced strongly by an unexpected event in

March 2011, the East Japan Earthquake.

METI announced that it called for organizations for creating master plans, using the

“Subsidy for Projects Promoting the Introduction of Smart Communities (FY 2011

Third Supplementary Budget)”. It selected eight local governments in the Tohoku

region as areas of master plan creation, following examination by outside experts

(METI April 2012).

In order to promote the recovery of earthquake affected areas, the Japanese government

prepared a subsidy (¥8.06 billion) for projects, which promoted introduction of smart

communities, as FY 2011 Third Supplementary Budget to support smart communities

using renewable energy, which were jointly established by businesses and each

prefectural government of Fukushima, Miyagi, and Iwate, affected by the Great East

Japan Earthquake. These projects supported creating master plans for establishing smart

communities (Project I). METI subsidized the expenses of the selected plans, their

necessity for devices for the systems to be introduced, such as energy systems managed

in the areas or renewable energy systems, or expenses necessary for management of the

project, based on the plan authorized by the Conference of the Next Generation Energy

and Social System (Project II).

The Japanese government expected that the local governments would establish smart

communities using the results from the demonstration in four pilot projects above

mentioned by selected businesses, including new energy businesses, local companies

such as marine products processors, auto makers, and telecommunication carriers.

From February 14 to March 19, 2012, METI invited organizations for creating master

plans, with the process implemented by a public organization, the New Energy

Promotion Council (http://www.nepc.or.jp/), which distributes the subsidy. METI

received eight applications and selected the following proposals through the

examination by outside experts and others.

1. Aizuwakamatsu City, Fukushima Prefecture: with Fujitsu and Tohoku-Electric

Power

2. Kesennuma City, Miyagi Prefecture: with Ebara Environment Plant, Future Design

Center, Abecho Shoten, Kane, Kaneka Seafood, Kesennmuma Cooperative Society

EGPA2013 PSGI KUDO

11

of Marine Products Processors, Sanriku Toyo, Takajun Shoten, Takahashi Suisan,

Hachiyo Suisan, and Marufuji

3. Ishinomaki City, Miyagi Prefecture: with Toshiba and Tohoku-Electric Power

4. Ohira Village, Miyagi Prefecture: with Toyota and Central Motor

5. Yamamoto Town, Miyagi Prefecture: with ENNET and NTT EAST

6. Miyako City, Iwate Prefecture: with ENNET, NTT Data, and JDC Corporation

7. Kamaishi City, Iwate Prefecture: with Nippon Steel Engineering and

Tohoku-Electric Power

8. Mogami City, Iwate Prefecture: with JX Nippon Oil & Energy Corporation and

Kitakami Office Plaza

Aizuwakamatsu City was the only community selected for creating a master plan in

Fukushima Prefecture under this supplementary budget. However, as it was necessary to

enhance promotion of the smart community project in the prefecture, METI decided to

support Minamisoma and Iwaki City, which were not among the candidates, as

communities for creating master plans.

Selected municipalities had to submit the plans by the end of September 2012 and

METI subsidized the expense for systems and devices to be introduced and

management of the project by the end of FY 2015, a period for intensively restoring the

affected areas, according to the plan authorized by the Conference of the Next

Generation Energy and Social System (Project II). METI had assisted actions for

creating the plans.

The projects have not yet realized significant achievement, since they are in the

planning process. At least, there have been intensive discussions among planners and

architects how to reconstruct the earthquake affected areas. One of the ideas is to create

many compact housing complexes in coastal areas, so that in case of tsunami, the

inhabitants can have shelters in walking distances. Since many inhabitants do not want

to leave the coastal areas because of their activities, this is considered to be a rather

realistic hypothesis, although the cost of the reconstruction would be very expensive.

The other idea is to move housings as well as facilities to the inner and thus safer places,

however this has encountered many criticism.

It is too early to analyze these cases in Tohoku area, since the real projects have not yet

started. There are delays related to the difficulties in providing personnel and materials,

not only to these projects, but in many other projects related to earthquake affected

areas.

2. Pilot Projects

EGPA2013 PSGI KUDO

12

In August 2010, the selected areas for the original project (“Next-Generation Energy

and Social Systems”) presented their master plan for the project.

Kitakyushu city in Fukuoka Prefecture originally presented a proposal as follows:

aim for regional energy management in which citizens and all other community

members participate, by building a smart grid based on the local new energy

infrastructure (solar power, hydrogen, etc.) and community infrastructure of the

Yahata Higashida district, which has been pursuing an eco-friendly community

under the leadership of the private sector, and eventually create a society with 50%

less CO2 emissions;

disseminate the outcome across the city by incorporating it in the city’s community

development policy and expand it to Asia through networking with other Asian

cities;

seek to achieve, in addition to the current target of reducing CO2 emissions by 40%

by 2030 and 70% by 2050 in the residential/commercial and transport sectors), an

additional 10% reduction (80% reduction instead of 70% by 2030, 80% reduction

instead of 70% by 2050).

The plan includes the following actions:

creation of a city block where new energy, including that from industry, accounts

for 10% of energy consumption;

deployment of energy conservation systems for an entire town (e.g., real-time

energy management for 70 companies and 200 households using smart meters);

city block energy management through a regional energy saving station;

development of communities and transport systems based on energy infrastructure;

establishment of a system to transfer the outcomes to other parts of Asia.

Kitakyushu City has collaborated with various cities and area in Southeast Asia for

technology and knowledge transfer related to prevention of pollution and eco-friendly

and eco-related industries.

When the municipalities had to present their plans, the city presented its plan as:

plans to conduct an energy management project that effectively uses regional

energy sources through measures such as producing energy from waste heat and

hydrogen available at nearby factories to be supplied to households and allowing

buildings to interchange power,

plans to implement dynamic pricing, a scheme to change power rates according to

the regional energy supply and demand balance, and control home electrical

appliances.

EGPA2013 PSGI KUDO

13

The City is a designated city located at the Northeast tip of the Kyushu area, with a

population of more than 970,000 people. Following the construction of the Yawata Steel

Works in 1901, the City developed as a centre of heavy and chemical industry. In the

1960s, the city faced air pollution and contamination of the waters of Dokai Bay.

Having overcome its various problems by means of measures to respond to and prevent

pollution, the city has been making efforts to tackle environmental problems.

In the Higashida area of Yahata-Higashi ward, the site of the operational experiments

and of the Yawata Steel Works, the city is proceeding with the development of a new

city district on unused land. In the new district, the City is pushing ahead with the

establishment of a variety of new energy distribution infrastructure, for example, for the

supply of energy produced by natural gas cogeneration by means of the steelworks'

transmission network, and the supply of hydrogen produced by the steelworks by

pipeline to areas within the district.

Sketching a vision of the optimum form for community energy management, the project

seeks to create the appropriate social structures for a low-carbon society by innovating

lifestyles, business styles, and urban planning. By means of the establishment and

operation of a customer energy management system called Smart Community Centre,

the project aims to establish mechanisms for citizens and companies to think about and

participate in the process of energy distribution. The city believes that making energy

use visible can encourage change in lifestyles and business. In addition, other initiatives

include preparation for the large-scale introduction of next-generation vehicles and their

linkage with public transport. The outcomes of the operational experiments in the

Higashida area will be extended to other areas of the City, for example, the Jono district

in Kokurakita ward (approximately 20 square kilometre in area), which is being newly

developed.

Due to factors including the establishment of environmental facilities and the

introduction of a range of new energy sources, the Higashida area in Yahata-Higashi

ward of the City already emits 30% less CO2 than other areas in the city. This trial aims,

by means of initiatives including further introduction of new energies, the use of

community energy management, and the establishment of new transport systems, to

achieve a further 20% reduction, reducing CO2 emissions to more than 50% less than

other areas in the city. The following five measures are being put into effect as the

concrete means of achieving this goal.

(1) Increase the rate of introduction of new energy sources, including photovoltaic

generation, fuel cells, and small-scale wind power generation, to 10% or more

(2) Development of Home Energy Management System (HEMS) and Building and

EGPA2013 PSGI KUDO

14

Energy Management System (BEMS), which can be coordinated with community

energy management, increasing the efficiency of energy saving in normal homes and

various types of buildings

(3) Establishment of a Smart Community, which provides advanced energy control and

optimizes total energy distribution, encompassing electric vehicles (EV), storage

batteries, etc.

(4) In parallel with the establishment of charging infrastructure to facilitate large-scale

introduction of EV, etc., the construction of next-generation traffic systems linking

bicycles and public transport.

(5) The extension of the new technological systems and business models emerging from

the operational experiments to Asia via an Asia Low-carbon Centre.

It is clear that the city had concentrated its attention on energy, not necessary on ICT

driven services, although the very first intention of METI was the small gird, the small

community, and the small city in terms of ICT use. This is not because the city has

strong interests in environmental industry, but can be observed in other projects as well.

It is, however, not clear, if the city had really considered the project in terms of creating

small city using ICT as major driver. From the official materials of the municipality and

interviews conducted among the public servants in the municipality, it emerges that the

main focus of the municipality has been the energy issue, and not the community

planning and/or citizen services.

It is interesting to note, thought that the municipality is one of the very first and most

advanced city in terms of recycling industrial wastes and using energy produced by the

process. The municipality,

In order to understand then, why the METI was keen in developing these projects,

especially in these areas, the author analyses the general characteristics of

e-Government in Japan. As it is explained in Chapter 3, since the major e-Government

policies and strategies had been developed by the Ministry of Internal Affairs and

Communications (MIC), the METI had stayed outside for most of the period. The

current projects, which has focus on local and regional economic development and thus

job creation, fit perfectly to METI, since it is the competency of the Ministry, and since

it had wanted to enter the e-Government field.

3. Japanese e-Government: its recent history and characteristics

In some Asian countries, reforms in public administration are implemented with similar

methodologies to those in EU member countries but with different targets. Their major

EGPA2013 PSGI KUDO

15

concern is how to tackle corruption and clean up certain political relationships within

public administration. Improving and rationalizing managerial aspects of public

administration is a secondary consideration (Kudo, 2003, 2004). In Japan, e-governance

policy was rather independent of other public sector reform. The strategy was

business-lead and many legal aspects were left aside.

Use of ICT is highly desirable in these plans, because of the need for transparency.

E-procurement, e-bidding, and other uses of ICT for administrative procedure

improvement increase transparency and leave little room for corruption. In various

countries, different techniques have been introduced to administrative procedure to fight

against corruption, to improve transparency in the government and thus, to enable

public management reform. Transparency and accountability, which are promised by

e-governance, are changing the public sector. The focus is on institutional change that

was brought on by ICT policy.

3.1. E-Government of central administration

In Japan, e-governance policy is a rather recent issue. The Kasumigaseki-WAN (Wide

Area Network), which is the central government network system, came into operation

only in 1997, the residential register network system started to operate only partially

after a long and suffering debate in August 2002, and the local government information

network system is still to be fully established.

The government invested effort in building the “Basic Residential Registers Network

System”. The system links all municipalities and prefectures so that the central and local

governments can share resident register information (e.g., name, address, sex, and date

of birth) based on residential register codes. According to the government, “it is

expected to help create an information infrastructure that is essential for efficient

responses to the improvement of local administration such as decentralization and the IT

(the Japanese government uses “IT”, instead of “ICT”) Revolution”. However, such was

the strength of public fears in relation to data protection and privacy, that the

establishment of a network system just to exchange these four basic items of data was

impossible for a long time. There are still some municipalities, with populist mayors,

opposing connection to the network and thus causing serious inefficiency in the network

operation.

It is interesting to note that the major documents of the government still uses the word

“IT”, led by the METI, while MIC uses “ICT” in its documents.

The government is aiming “to respond to the growing expectations for administrative

operations that match the IT Revolution” and to implement e-governance so that

EGPA2013 PSGI KUDO

16

“administrative works for applications, notifications, etc. will be handled through the

networks”. In order to introduce ICT for administrative works in general, it is necessary

to “informatize” local governments, as most of the important and essential functions and

tasks are carried out by municipalities in Japan. The Local Administration Bureau of the

Ministry of Internal Affairs and Communications (MIC, previously known as Ministry

of Public Management, Home Affairs, and Post and Telecommunications, MPMHAPT)

is promoting the establishment of e-local government in coordination with national

policies and measures. At the same time, the government supports local governments to

improve local information and communications infrastructure (e.g., wider use of optical

fibre cables), as well as transmission of local information. However e-governance

policy in Japan remains fragmented and business-lead, thus priorities are given to

infrastructure building and equipment supply, without any strategy addressing how to

design and make use of the e-governance system. There are two further elements that

have decisive impact on e-governance policy in Japan: the lack of basic legislation on

ICT, and public concerns regarding privacy and data protection.

A “Panel on Revitalization of Local Community and Ubiquitous Network Society” was

convened. With the aim of invigorating local communities and economies through

creation of local ubiquitous network societies, MIC held the first meeting of the “Panel

on Revitalization of Local Community and Ubiquitous Network Society” in November

2006. The primary purpose of the Panel is to conduct analysis of and to study local

communities and to create local ubiquitous network societies, with the aim of helping to

contribute to deliberate specific issues on local ubiquitous network societies and

specific measures, required to realize local ubiquitous network societies. The Panel

compiled a report in June 2007.

The Panel analysed and study the following items: i) problems faced by local

communities, ii) creation of local ubiquitous network societies and effects thereof, iii)

ICT policies for creating local ubiquitous network societies, a) comprehensive program,

b) support measures.

Japanese e-governance is based on a series of strategies. Recent evolution shows that

the “Basic Policy for the Promotion of Advanced Information and Communication

Society” (issued 1995, revised 1998) was developed into “Basic Law to build an

Advanced Information and Communication Network Society” (Law No.144 of 2000,

effective since January 2001), which, in turn, became “e-Japan Priority Policy Program

2004”, after three previous programmes issued each year after 2001 and two major

strategies regarding Japanese ICT (“e-Japan Strategy” and “e-Japan Strategy II”). These

priority policies recently developed into “ICT Policy Package 2005”, which was

EGPA2013 PSGI KUDO

17

decided by the ICT Strategy Headquarters in February 2005.

Meanwhile, the reform of public administration through ICT has been promoted in a

parallel way: “Master Plan for Promoting Government-wide use of IT” was issued

between 1994 and 1999, and revised between 1998 and 2002. The “Program for

Building e-Government” was decided by the CIO Council in July 2003, a result the

master plan and the “e-Japan Priority Policy Program 2003”. The programme was

converted into “Future Initiatives for Administrative Reform” in December 2004 by the

Cabinet Decision.

The “Program for Building e-Government” had its programme period from FY2003 to

FY2005 (subject to annual review) and had two major goals. One was to provide

“User-oriented Administrative Services” and the other was to realize “Streamlined

Public Administration with High Budget Efficiency”. The two basic principles

underlying these goals are: “Provide Convenient and High quality Services to the

Public” and “Renovate Administrative Systems and Operations”. The latter involved a

“zero-base review” of administrative systems and operations to make them rational and

efficient by introducing unified systems for back-office operations and by outsourcing

various operations of routine nature (E-Government Committee, 2006)

In order to develop infrastructure for building e-government, it analysed that

strengthened infrastructure for e-government was needed, for example, making the most

of “Assistant CIOs” (technical advisors appointed from outside) and fortifying measures

of security and legal system of Protecting Personal Information.

In order to reform administrative systems and their operations though ICT, the Japanese

government developed its ICT infrastructure as follows: provision of one PC to each

official, completion of in-house LANs and Kasumigaseki-WAN (Wide Area Network

for Ministries), and connection of Kasumigaseki-WAN, LGWAN (Local Government

Wide Network Area), and Judicial ICT System (Network for Court).

In terms of administrative reform through ICT, assistant CIOs (ICT external experts)

were appointed as technical advisors in all Ministries in December 2003. Assistant CIO

Council was established in December 2003, and administrative systems and operations

were systematically classified. 79 areas were designated for which Optimization Plans

are to be formulated (23 common areas, 56 particular areas) (Sawamoto et al, 2007).

Optimization Plans were already adopted in nine areas applicable to all ministries:

personnel & payroll, accepting e-applications, e-provision of administrative information,

government employees mutual aid association, procurement, inventory management,

benefits & allowances, subsidies, and travel expenses. Optimization Plans for particular

areas were adopted in 12 areas: registration, patent, radio wave control, state pension,

EGPA2013 PSGI KUDO

18

national forestry, food administration, and meteorological services, among others.

One of the new challenges for the reform of administrative systems and their operations

is the formulation of an Optimization Plan for each of the 79 designated areas of

administrative systems and operations, that is to say, implementation of optimization.

These Optimization Plans have four aspects: quantify estimated “Effects of Reducing

Processing Time and Costs”; build government-wide integrated systems for “Common

Operations”, that is, eliminate overlapping investments in building systems and promote

efficient budget spending; drastically cut costs and streamline operations of “Legacy

(old) Systems” by, (1) clarifying “Investment-Effectiveness” by complete renewal of

systems, (2) transforming to “Open Systems”, (3) re-examining Contracts; shifting from

“Contracts ad labium” to “Open tendering procedures”, etc.; and implement and

evaluate the optimization, that is, Administrative Management Bureau (MIC) formulates

guidelines for both “Implementing the optimization” and “Evaluating the

implementation of optimization”. The Bureau evaluates and monitors consistency

between these guidelines and the optimization implemented by respective Ministries

(Sudoh, 2007).

These promote simplification, rationalization, and efficient operation of administration

strategically and across the board to ensure overall optimization of the government.

3.2. Innovation of e-Local Governments in Japan

In Japan, efforts to establish and promote e-Local Government have been a national

project promoted mainly by the Ministry of Internal Affairs and Communications. The

project has been considered as one of the strategies for structural reform of the public

sector, through revision of administrative procedure, improvement of efficiency, and

promotion of citizen participation using ICT for local social networking systems.

Other programmes include the local government EA (Enterprise Architecture)

programme, which should maximize managerial capacity of local governments, and the

common outsourcing programme, which provides a reasonably priced and high standard

security system for the implementation of local information system.

Local governments introduce common outsourcing of public management in order to

improve citizen services, cut costs, reform management procedure, and create new

needs among local ICT related business. The municipalities involved in the programme

work for standardizations and unification of services through outsourcing, which

enables drastic cost cutting and high quality in public service. Local e-government

efforts aim to create new demands and consequently new business in the territory; but

they are also utilized in order to overcome bureaucracy in the public sector through ICT

EGPA2013 PSGI KUDO

19

and to deliver efficient public services. The idea of local e-government is utilized for the

establishment of a safe and secure community through use of ICT and its network for

local development and crisis management. The latter is highly important especially in

Japan, where the threat of earthquake is constantly present (Sudoh, 2007).

In order to establish local e-government, it is necessary to have a good strategy to

overcome the shortage of financial and human resources. As significant financial

resources are required to establish these strategies in single municipalities, it is

necessary to coordinate efforts and develop a common policy, which can be shared by

more than one municipality. Many municipalities have already introduced the basic

information system to run financial, fiscal and human resource management systems.

Some municipalities have even introduced internal LAN system, to which all public

servants are connected, groupware and portal access for employees. However the real

challenge in many local governments is the improvement of efficiency and service

quality.

The realization of common outsourcing is planned, as it enables the use of

well-established and equipped common system.

There are, however, challenges for the establishment and promotion of this kind of local

system. According to the “2006 Report of e-Government Evaluation Committee”, there

are three fundamental issues: the first is the customer orientation and outcome

orientation, the second is the connection between front office function reform and back

office function reform, and the third is the maximization of function among ministries

and agencies, national and local governments, public and private sectors, through

common systems. The report also pointed out the importance of the role of CIO (Chief

Information Officer).

Japanese government introduced the role of CIO at ministerial level in 2002 and

appointed CIO assistants in 2003. The idea came from the Information Technology

Management Reform Act of 1996 in the United States, but the role and function of

Japanese CIO were not specified as in the US and as a result, there is a wide capacity

gap among Japanese CIOs in the public sector. Japanese local governments have also

introduced CIO and CIO assistants since 2002, however, they have encountered the

same issues as the ministerial CIO as well as the difficulty in recruiting suitably

qualified persons (Obi, 2007).

There are successful cases of innovative use of ICT in municipalities, including

introduction of common public management systems for public facility management,

public hospital management, school management, and elderly assistance facility

management. These systems are sometimes utilized by local businesses and are

EGPA2013 PSGI KUDO

20

bringing positive results. Medicine, social welfare service, especially child and elderly

care, and education typically benefit from the introduction and establishment of ICT

system in the public sector.

3.3. Observations from Smart City projects and e-Government policy

From the description above mentioned of projects under Smart City and Smart

Community, and of the Japanese e-Government policy and strategy, it is possible to

draw various observations.

First, the current Smart City and Smart Community projects are still in a too early stage

to understand the very intention of the government as well as municipalities. However,

from the materials of METI, it is rather clear that the original policy of Smart City and

Smart Community is the economic stimuli, considering that the investment related to

the projects might boost industrial activities in the territories. The fact, that the private

companies in the territories, and major energy, telecom, and IT companies are involved

from the very early stage of the projects, means that the Ministry was mostly keen on

the creation of new industry through the projects. This process has been typical to the

Ministry; it is well known that the high-tech industry had benefited mostly from these

policies (Okimoto, 1989)

Second, the major part of the current projects regards on energy, especially on energy

saving and creation of new energy sources. City planning and building management are

part of this energy saving strategy. The latter was launched before these projects, mostly

by local governments. Building energy management was sought to save urban energy

consumption, at least to rationalise it. At territorial level, energy saving strategy was

introduced by private companies, including developers and building companies.

However these projects remained isolated ones, without broader strategy for the

community. Then the Smart City and Smart Community projects included these

experiences into its policy and have been successfully applied in many foreign projects.

After the Earthquake, this tendency became more evident, although projects in the area

of earthquake have little to do with energy saving.

Third, in terms of ICT use in the territory, the Smart City and Smart Community

projects have realised little until now. They included intelligent traffic management

system and EVs in the original projects, however these are only on a very early stage.

Lastly, it is interesting to note that the various projects related to ICT have initiated by

different ministries and have been poorly coordinated. Major ICT projects in central and

local governments have been promoted by MIC, meanwhile ICT industry related

projects have been promoted by METI. They were independently initiated and although

EGPA2013 PSGI KUDO

21

many projects had similar characteristics, they are not coordinated among themselves. It

is possible to observe typical sectionalism among ministries, which is one of the

obstacle for integrated ICT policy development in Japan.

References

E-Government Committee (2006), 2006 Report of e-Government Evaluation Committee,

Ministry of Internal Affairs and Communications, Government of Japan

Iijima, J. (2007), “IT Toushi Senryaku to CIO” (IT Investment Strategy and CIO), in

Sudoh, O., T. Obi, H. Kudo, and R. Gotoh, (eds.), CIO Gaku: IT Keiei Senryaku no

Mirai, (CIO Theory: Future of IT Management Strategy), University of Tokyo Press,

pp.117-135

Japan Smart City Portal, portal site for “Smart City”: http://jscp.nepc.or.jp/ (last

consultation July 2013)

Kudo, H. (2003), “E-governance in South-east Asian Countries: changing Management,

Interface, Accountability, and Transparency in Public Sector” Paper presented at IIAS

26th International Congress, “E-Governance: Challenges and opportunities for

Democracy, Administration and Law”, July 2003, Seoul, South Korea

Kudo, H. (2004), “Reform of Public Management through ICT: Interface,

Accountability and Transparency”, in L. R.Jones, K. Schedler, and R. Mussari, (eds.)

The Impact of Management Reform on Informal Relations in Public Service, Elsevier,

pp.153-174

Ministry of Economy, Trade and Industry, explanation about the policy and the projects:

http://www.meti.go.jp/policy/energy_environment/smart_community/community.html

(last consultation July 2013)

Ministry of Economy, Trade and Industry (2010a), press release materials regarding

“Demonstration of Next-Generation Energy and Social Systems” (mostly on:

http://www.meti.go.jp/english/press/data/20100408_01.html and its original Japanese

version)

EGPA2013 PSGI KUDO

22

Ministry of Economy, Trade and Industry (2010b), press release materials regarding

“Presentation of master plans of the projects of Next-Generation Energy and Social

Systems” (mostly on: http://www.meti.go.jp/english/press/data/20100811_01.html and

its Japanese version)

Ministry of Economy, Trade and Industry (2011), materials regarding feasibility studies

on smart cities in foreign countries (see, for example:

http://www.meti.go.jp/english/press/2011/1011_04.html and

http://www.meti.go.jp/english/press/2011/1216_01.html)

Ministry of Economy, Trade and Industry (2012), materials regarding “Subsidy for

Projects Promoting the Introduction of Smart Communities” (see:

http://www.meti.go.jp/english/press/2012/0417_01.html)

Ministry of Economy, Trade and Industry (2013), materials regarding feasibility studies

on smart cities in foreign countries and analysis of applied projects (see:

http://www.meti.go.jp/english/press/2013/0802_02.html)

Ministry of Internal Affairs and Communications (2002), Whitepaper on Information

and Communications in Japan, Ministry of Internal Affairs and Communications,

Government of Japan

Obi, T. (2007), “CIO-gaku no mezasu mono (What CIO Theory aims)” in Sudoh, O., T.

Obi, H. Kudo, and R. Gotoh, (eds.), op.cit., pp.1-19

Okimoto, D. I. (1989), Between MITI and the Market: Japanese Industrial Policy for

High Technology, Stanford University Press

Sawamoto, R., Ueda, H., Kosaka, M., and Takeda, M. (2007), “CIO no variation”

(Variation of CIO), in Sudoh, O., T. Obi, H. Kudo, and R. Gotoh, (eds.), op.cit.,

pp.177-198

Sudoh, O. (2007), “ICT wo mochiita Gyosei Kaikaku to CIO” (Public Administration

Reform using ICT and CIO), in Sudoh, O., T. Obi, H. Kudo, and R. Gotoh, (eds.), ibid.,

pp.55-74

EGPA2013 PSGI KUDO

23

Tsujii, S. (2007), “Jyouhou Security” (Information Security), in Sudoh, O., T. Obi, H.

Kudo, and R. Gotoh, (eds.), ibid., pp.155-176