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Evaluating the economic impact of wind power development on local economies in China

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  • Xia, Fang
  • Song, Feng

Abstract

Given that wind power has received so much public financial support, it is important not only to understand its overall impact but also who receives the benefits and who bears the costs. One important aspect is to quantitatively evaluate the potential impact of wind power development on local economies. This study conducts an ex post econometric assessment of the effect of wind power installation on local economy in China, using a national county-level dataset between 2005 and 2011. We find that installed wind power capacity has a small and statistically significant positive effect on GDP but negatively affect local fiscal income. Based on our results, an additional 1MW wind power installation (per capita) would bring 2246 RMB increase in GDP per capita over the year 2005 and 2011. The annual benefits is about 321 RMB ($45)increase in GDP per person, which is much lower than the estimates for U.S. case. We further explore why China's wind power development did not benefit local economy as much as the case of U.S.

Suggested Citation

  • Xia, Fang & Song, Feng, 2017. "Evaluating the economic impact of wind power development on local economies in China," Energy Policy, Elsevier, vol. 110(C), pages 263-270.
    • Handle: RePEc:eee:enepol:v:110:y:2017:i:c:p:263-270
    DOI: 10.1016/j.enpol.2017.08.030
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    Citations

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    Cited by:

    1. John Dorrell & Keunjae Lee, 2020. "The Cost of Wind: Negative Economic Effects of Global Wind Energy Development," Energies, MDPI, vol. 13(14), pages 1-25, July.
    2. Davor Mikulić & Željko Lovrinčević & Damira Keček, 2018. "Economic Effects of Wind Power Plant Deployment on the Croatian Economy," Energies, MDPI, vol. 11(7), pages 1-20, July.
    3. Jiu Gu & Yining Wang & Da Xie & Yu Zhang, 2019. "Wind Farm NWP Data Preprocessing Method Based on t-SNE," Energies, MDPI, vol. 12(19), pages 1-16, September.
    4. Pejman Bahramian & Glenn Jenkins & Frank Milne, 2020. "A stakeholder analysis of investments for wind power electricity generation in Ontario," Working Paper 1442, Economics Department, Queen's University.
    5. Costa, Hélia & Veiga, Linda, 2021. "Local labor impact of wind energy investment: An analysis of Portuguese municipalities," Energy Economics, Elsevier, vol. 94(C).
    6. Du, Yimeng & Takeuchi, Kenji, 2020. "Does a small difference make a difference? Impact of feed-in tariff on renewable power generation in China," Energy Economics, Elsevier, vol. 87(C).
    7. Bahramian, Pejman & Jenkins, Glenn P. & Milne, Frank, 2021. "A stakeholder analysis of investments in wind power electricity generation in Ontario," Energy Economics, Elsevier, vol. 103(C).
    8. Ye Yang & Ying Xu, 2022. "Does wind and solar power substitute thermal power? Evidence from China," Letters in Spatial and Resource Sciences, Springer, vol. 15(3), pages 435-449, December.
    9. Yu-Ling Hsiao, Cody & Sheng, Ni & Fu, Shenze & Wei, Xinyang, 2022. "Evaluation of contagious effects of China's wind power industrial policies," Energy, Elsevier, vol. 238(PB).
    10. Xu, Xiaomin & Niu, Dongxiao & Xiao, Bowen & Guo, Xiaodan & Zhang, Lihui & Wang, Keke, 2020. "Policy analysis for grid parity of wind power generation in China," Energy Policy, Elsevier, vol. 138(C).

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    More about this item

    Keywords

    Q42; Q48; R11; Wind power; Economic impacts; Local economy;
    All these keywords.

    JEL classification:

    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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