JFS Newsletter No.151 (March 2015)
http://www.japanfs.org/en/news/archives/news_id035217.html

Japan for Sustainability (JFS) worked on its Local Well-Being Project since April 2013, because we believe that local activities for well-being are the key to our happiness and planetary sustainability. Likewise, the state of the local economy is an indispensable item to consider when we are looking closely at happiness and its relationship to local activities.

JFS held a symposium on February 9, 2015, titled "Community Initiatives for Survival--from a Local Economy / Regional Revitalization Perspective," to which front-running practitioners in local community development were invited as guest speakers. From among their presentations, JFS will introduce a lecture by Takashi Kasuga, Executive Director, Future City Project Headquarters, Shimokawa Town, Hokkaido, in this issue and the next. This month's article will feature the "economy" side of Shimokawa Town's initiative to establish a sustainable town using forest resources.

Initiatives in Shimokawa Town, Hokkaid

Shimokawa is a pioneering-minded town -- we are not very interested in what other towns do, and always try to do something original.

The population of Shimokawa is about 3,500 at present. Its area is about equal to all of Tokyo's 23 wards, being 20 kilometers from east to west and 30 kilometers from north to south. About 90 percent of the area is covered with forest. In 1953, the town purchased an area of national forest; this was a turning point and the foundation of today's initiatives. The town paid 88 million yen (about US$733,333) for 1,200 hectares of mountainous forest at a time when its annual budget was only 100 million yen (about US$833,333).

From 1960 up until now, we have planted 40 to 50 hectares of trees in these mountains each year. When we had afforested all the area where we could plant trees, we bought another block of national forest. This time, we paid 2.2 billion yen (about US$18,333,333), and we have planted and grown trees in this area as well.

It takes about 60 years for plantations of Sakhalin firs and Japanese larch trees -- both are Hokkaido's prefectural trees -- to grow big enough to be cut down. Because we plant trees every year, the age of the trees in these man-made forests vary from one year to 50 to 60 years old, all of which are growing well. Starting this year, we are now able to practice circulating forest management -- cutting down trees that our predecessors planted and then re-planting more trees in the logged area. I am not aware of any other town practicing this kind of forest management. There is no income for about 60 years while trees are being planted. Considering the economy of this method, nobody wants to do this. We have had great predecessors in Shimokawa Town.

A forestry cooperative is responsible for growing and taking good care of trees ranging from one year to 50 to 60 years old in the mountainous forests that the town bought. Currently, about 64 people work in the cooperative. An increasing number of people have been returning or moving into Shimokawa, and there are always roughly 20 to 30 people who want to work in the cooperative. They can get these jobs only when a vacancy opens up.

In order to generate small businesses connected to forestry, we also process timber from forest thinning, including both thin to thick trees; in many ways this is like harvesting fruit from clusters of grapes. We waste nothing and use everything we take from the forest. We have a system to exploit the blessings of forest -- for example, using Sakhalin fir leaves to extract essential oil or as filling for pillows, as well as taking care of the forest by thinning the trees, which also provides timber.

Looking at the demographics of Shimokawa Town, we can see that population outflow has been stopped by the town's policy of buying and taking care of forests, creating small businesses related to forests, and preparing workplaces to receive people coming back or moving into the town. As the number of working people is increasing, the number of children is growing as well because they come here with their parents. These analyses were performed by university professors at the request of the town. I think it is very important to adopt appropriate policies and take action based on experts' opinions and a proper understanding of the structures and mechanisms underlying current developments.

We established an "Industrial Cluster Study Group" in 1998. This study group drew up a grand design for the town on the basis of discussions among all stakeholders, mainly townspeople, and concluded that it is not possible to lead quality lives if industry, nature, and society are unsustainable. Looking back, I think that drawing up this grand design through discussions that considered an overall balance, including not only industry but society and nature as a whole, led to today's initiatives.

In 2002, we organized a group to realize the grand design, and this organization is moving ahead with clear vision. The design image covers not only agriculture but also forest-based small-scale industries in the community, such as forest management, non-profit organizations, tourism and service industries. Civil engineering projects will also shift their focus to forestry and the environment. In addition, through supporters' and fan clubs, the organization tries to communicate with people in other parts of the country face to face. It is also trying to create a community that can earn "foreign" money by providing services outside the town.

Based on our predecessors' concept that "wherever there are resources, industries will emerge," Shimokawa has created an industry by nurturing community-based resources for 50 to 60 years. One related project started in 2004 involves systematically shifting energy use in public facilities, such as public baths, from conventional fossil fuel (oil) to wood waste. Our current basic idea is "where there are energy resources, industries will emerge," and about 60 percent of public facilities, such as a day-care center and agricultural facilities, are powered by boilers using wood waste. CO2 emissions from public facilities have been drastically decreased accordingly. If we maintain the pace of energy shifting from fossil fuel to wood waste and wood chips for boilers in a self-sufficient way, we will be able to achieve a reduction of 4,700 tons of CO2 emissions in 2022.

With fossil fuel prices rising, we have actually saved about 17 million yen (about US$141,666) by replacing oil with wood waste, because wood waste is abundant in Shimokawa. We have put aside half this amount for updating boilers in the future, with the rest going to a childcare fund. This fund is used for a range of programs by supporting school lunch costs, cutting childcare fees, providing free medical care for children from birth to junior high school age, supporting fertility treatment expenses, while providing a subsidy of 36,000 yen (about US$300) a year for children up to two years old. The system encompasses abandoning fossil fuel and burning wood chips to save money, and providing the saved amount to childcare services to make life in the town happier for children.

A few years ago, a research group with university participation studied the flow of money in Shimokawa. Currently, Shimokawa's intraregional production value amounts to 21.5 billion yen (about US$179 million). It earns money outside the region by selling agricultural and forestry products. The money guzzler is energy. Of a total of 1.2 billion yen (about US$10 million) flowing out of the region, 700 million yen (about US$58,333) is for oil, coal and fossil fuels and 500 million yen (about US$41,667) is for electricity. The balance of payments within the region amounts to a 5.2 billion yen (about US$43.3 million) deficit.

If we do a simulation of how the economy would change if we plugged the energy leak amounting to 1.2 billion yen's worth (about US$10 million) a year by creating energy within the region, the result would be an increased production value in the region of 2.8 billion yen (about US$ 23.3 million). This would include a 700 million yen (about US$58,333) increase in combined forestry and forest product production, and it would also mean jobs for about 100 more workers in the region. The overall picture is an increase in workplaces as the scale of economy expands. As a timber-producing town, Shimokawa provides timber for flooring to a co-working space, T-Time, in Akasaka and to other public facilities in Tokyo's Minato Ward. Needless to say, the town is also internationally certified by the Forest Stewardship Council. This is the Shimokawa model.

Two-thirds of Japan's land is classified as forest. Among 1,718 municipalities, 734 (43 percent) meet national government criteria for "developing mountain villages" by having over 75 percent of their area under forest. Shimokawa Town might provide a robust model that could spread across Japan to revitalize farming and mountain villages by increasing employment and providing opportunities for achieving self-actualization. I think it could be one of the models for Japan's future development. In Hokkaido, 13 out of 179 municipalities are working on biomass projects similar to that of Shimokawa Town. The town intends to promote this approach throughout Japan and the world.

The important point in the shift toward biomass energy is what will happen to people who have been making a living by selling fossil fuels. The bottom line is that their sales will drop. One of the reasons we are not seeing widespread biomass development is opposition from existing businesses. This is understandable. They won't be able to earn a living.

Shimokawa Town has three gas station unions that sell fossil fuels. The town asked them to establish a cooperative union to sell wood waste. In this way, the town helped these businesses change their activities to producing and selling wood waste instead of sticking entirely with fossil fuels and decreasing sales. Unless we provide new places for people to work, we will not be able to go forward together.

Still, people are fundamentally opposed to the shift because the sales volume of wood waste will amount to about one fifth of fossil fuel sales. They are against the shift not because they are opposed to the idea, but because of how it will affect their businesses. So we need to discuss this together while alleviating the sharp decrease. In fact, this cooperative cleared a profit of ten million yen (about US$83,333) in fiscal 2013. The cooperative and the town went fifty-fifty on the profit. The town has developed a way to recoup its investment without continuously losing money.

A subdivision project was also launched to build a biomass cogeneration plant in a suburb of Shimokawa Town, and to sell or consume the generated energy within the community, asking the residents whose homes are scattered around the area to live more closely together, and supplying heat through heat conduits. When this project is completed, it will create about 100 jobs and energy production volume equal to 2.8 billion yen (about US$23.3 million).

One way we bring money into the community is to sell carbon credits in exchange for growing trees, including maintenance and thinning, and their carbon sink effect. In 2009, the town made an agreement with "more trees," an organization represented by the musician, Ryuichi Sakamoto. Shimokawa was the first town in Japan to introduce an offset credit for forests. In cooperation with Nippon Professional Baseball, the town is offsetting carbon dioxide emitted through games that last for more than three hours. In addition, beer companies are using the town's offset program, which generates capital of about 0.14 billion yen (about US$1.17 million) that is re-invested in planting more forests.

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The next issue of JFS newsletter will focus on the "human" side of Shimokawa's initiative. Don't miss it!

To be continued...

Writtey by Takashi Kasuga, Executive Director, Future City Project Headquarters, Shimokawa Town, Hokkaido
Edited by Junko Edahiro