Sustainable Global Energy Systems

More fundamental than climate change is the issue that fossil energy resources, which are tens of millions of years of stock of solar energy, will deplete as they continue to be mined. This means that the cost of mining and the energy input for mining will increase, and finally they will no longer be energy resources. Therefore, our laboratory considers all the possibilities necessary to provide all the energy, directly or indirectly, from a part of the solar energy flow. Our specific research topics include the transition course of energy conversion, future trends in energy supply and demand structures, independent decentralized energy systems in low population density areas, and hydrogen-based storage and long-distance transportation of renewable energy. It is impossible to meet the entire energy demand of a region like Japan, which is rich in vegetation and has high population density and thus high energy consumption per area, with local renewable energy.

Real Option Analysis and Project Evaluation

The value of management flexibility (strategic options), which cannot be evaluated by the conventional DCF-ROR, is evaluated by applying financial option theory. This enables us to obtain a more realistic present value for projects such as resource development, and to avoid underestimating by DCF-ROR and overestimating by optimistic assumptions, and to make a bid at a fair price. Applying this concept, we will consider the optimal decision making at each timing point by using rainbow options that deal with multiple correlated underlying assets and compound options that are used for multi-step decision making.

Financial Innovation with Blockchain

As a project of Endowed Chair for Blockchain Innovation and the MbSC2030 General Endowed Chair (Saudi Center), we are engaged in blockchain-related research and development as well as entrepreneurial support for ventures with blockchain as their core technology. Specific research topics range from the fundamental question of whether virtual currencies (cryptocurrencies) can be currencies to the analysis of NFT (Non-Fungible Token) price trends and research on how to control the initial volatility of cryptocurrency prices on exchanges.

Energy and Resource Economic Systems

We will evaluate how changes in energy and resource prices affect the economy, and consider the economic effects of stockpiles of oil and mineral resources and optimal stockpiling strategies. It is said that for energy resources such as oil and metallic mineral resources, changes in demand (price elasticity) in response to short-term price fluctuations are small, while demand for long-term price fluctuations varies greatly due to energy conservation, substitution, and even changes in the economic structure. We will examine long-term energy scenarios and forecast models that take into account these characteristics of energy and resources.