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Green vs. Green: Measuring the Compensation Required to Site Electrical Generation Windmills in a Viewshed

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  • Peter A. Groothuis
  • Jana D. Groothuis
  • John C. Whitehead

Abstract

A willingness to accept framework is used to measure the compensation required to allow wind generation windmills to be built in the mountains of North Carolina. We address why the NIMBY syndrome may arise when choosing site locations, the perceived property rights of view-sheds, as well as the perceptions of the status quo in the southern Appalachian Mountains. We find that individuals who perceive wind energy as a clean source of power require less compensation. Those who retire to the mountains or individuals who have ancestors from Watauga County require more compensation to accept windmills in their view-shed. We find that annual compensation is about twenty three dollars per household. In the aggregate, citizens need to be compensated by about one-half million dollars a year to allow wind electrical generation turbines in Watauga County. In addition, we find in a bivariate-probit analysis that individuals who are more likely to participate in a green energy program also are more likely to allow electrical generation wind mills in their view-shed suggesting that the green on green environmental debate is overstated.

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File URL: http://econ.appstate.edu/RePEc/pdf/wp0712.pdf
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Bibliographic Info

Paper provided by Department of Economics, Appalachian State University in its series Working Papers with number 07-12.

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Date of creation: 2007
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Handle: RePEc:apl:wpaper:07-12

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Postal: Thelma C. Raley Hall, Boone, North Carolina 28608
Phone: 828-262-2148
Fax: 828-262-6105
Web page: http://www.business.appstate.edu/departments/economics/
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  1. Trudy Ann Cameron & Michelle D. James, 1986. "Efficient Estimation Methods for "Closed-Ended" Contingent Valuation Surveys," UCLA Economics Working Papers 404, UCLA Department of Economics.
  2. Charles Warren & Carolyn Lumsden & Simone O'Dowd & Richard Birnie, 2005. "'Green On Green': Public perceptions of wind power in Scotland and Ireland," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 48(6), pages 853-875.
  3. Ladenburg, Jacob & Dubgaard, Alex, 2007. "Willingness to pay for reduced visual disamenities from offshore wind farms in Denmark," Energy Policy, Elsevier, vol. 35(8), pages 4059-4071, August.
  4. Peter Groothuis & John Whitehead, 2002. "Does don't know mean no? Analysis of 'don't know' responses in dichotomous choice contingent valuation questions," Applied Economics, Taylor & Francis Journals, vol. 34(15), pages 1935-1940.
  5. Steven B. Caudill & Peter A. Groothuis, 2005. "Modeling Hidden Alternatives in Random Utility Models: An Application to "Don’t Know" Responses in Contingent Valuation," Land Economics, University of Wisconsin Press, vol. 81(3).
  6. John C. Whitehead & Todd L. Cherry, 2004. "Mitigating the Hypothetical Bias of Willingness to Pay: A Comparison of Ex-Ante and Ex-Post Approaches," Working Papers 04-21, Department of Economics, Appalachian State University.
  7. Richard Carson & Nicholas Flores & Norman Meade, 2001. "Contingent Valuation: Controversies and Evidence," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 19(2), pages 173-210, June.
  8. Peter A. Groothuis & George Van Houtven & John C. Whitehead, . "Using Contingent Valuation to Measure the Compensation Required to Gain Community Acceptance of a LULU: The Case of a Hazardous Waste Disposal Facility," Working Papers 9709, East Carolina University, Department of Economics.
  9. Kahn, Robert D., 2000. "Siting Struggles: The Unique Challenge of Permitting Renewable Energy Power Plants," The Electricity Journal, Elsevier, vol. 13(2), pages 21-33, March.
  10. Whitehead, John C. & Cherry, Todd L., 2007. "Willingness to pay for a Green Energy program: A comparison of ex-ante and ex-post hypothetical bias mitigation approaches," Resource and Energy Economics, Elsevier, vol. 29(4), pages 247-261, November.
  11. Borchers, Allison M. & Duke, Joshua M. & Parsons, George R., 2007. "Does willingness to pay for green energy differ by source?," Energy Policy, Elsevier, vol. 35(6), pages 3327-3334, June.
  12. Cameron, Trudy Ann, 1988. "A new paradigm for valuing non-market goods using referendum data: Maximum likelihood estimation by censored logistic regression," Journal of Environmental Economics and Management, Elsevier, vol. 15(3), pages 355-379, September.
  13. Roe, Brian & Teisl, Mario F. & Levy, Alan & Russell, Matthew, 2001. "US consumers' willingness to pay for green electricity," Energy Policy, Elsevier, vol. 29(11), pages 917-925, September.
  14. Kunreuther, Howard & Kleindorfer, Paul & Knez, Peter J. & Yaksick, Rudy, 1987. "A compensation mechanism for siting noxious facilities: Theory and experimental design," Journal of Environmental Economics and Management, Elsevier, vol. 14(4), pages 371-383, December.
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Cited by:
  1. Vanja WESTERBERG & Jette BREDAHL JACOBSEN & Robert LIFRAN, 2012. "The Multi-faceted Nature of Preferences for Offshore Wind Farm Siting," Working Papers 12-22, LAMETA, Universtiy of Montpellier, revised Jul 2012.
  2. Aravena, Claudia & Hutchinson, W. George & Longo, Alberto, 2012. "Environmental pricing of externalities from different sources of electricity generation in Chile," Energy Economics, Elsevier, vol. 34(4), pages 1214-1225.
  3. M. du Preez & G. Menzies & M.C. Sale & S.G. Hosking, 2011. "Measuring the indirect costs associated with the establishment of a wind farm: An application of the Contingent Valuation Method," Working Papers 258, Economic Research Southern Africa.
  4. Anabela Botelho & Lígia M.Costa Pinto & Patricia Sousa, 2013. "Valuing wind farms’ environmental impacts by geographical distance: A contingent valuation study in Portugal," NIMA Working Papers 52, Núcleo de Investigação em Microeconomia Aplicada (NIMA), Universidade do Minho.
  5. Jones, Christopher R. & Orr, Barry J. & Eiser, J. Richard, 2011. "When is enough, enough? Identifying predictors of capacity estimates for onshore wind-power development in a region of the UK," Energy Policy, Elsevier, vol. 39(8), pages 4563-4577, August.
  6. Koundouri, Phoebe & Kountouris, Yiannis & Remoundou, Kyriaki, 2009. "Valuing a wind farm construction: A contingent valuation study in Greece," Energy Policy, Elsevier, vol. 37(5), pages 1939-1944, May.
  7. Peter A. Groothuis & Kristan Cockerill & Tanga M. Mohr, 2013. "Water doesn’t flow up hill: Determinants of Willingness to Pay for Water Conservation Measures in the Mountains of Western North Carolina," Working Papers 13-26, Department of Economics, Appalachian State University.
  8. Andrew D. Krueger & George R. Parsons & Jeremy Firestone, 2011. "Valuing the Visual Disamenity of Offshore Wind Projects at Varying Distances from the Shore: An Application on the Delaware Shoreline," Working Papers 11-04, University of Delaware, Department of Economics.
  9. Slattery, Michael C. & Johnson, Becky L. & Swofford, Jeffrey A. & Pasqualetti, Martin J., 2012. "The predominance of economic development in the support for large-scale wind farms in the U.S. Great Plains," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(6), pages 3690-3701.
  10. Swofford, Jeffrey & Slattery, Michael, 2010. "Public attitudes of wind energy in Texas: Local communities in close proximity to wind farms and their effect on decision-making," Energy Policy, Elsevier, vol. 38(5), pages 2508-2519, May.
  11. Bjarne Steffen, 2011. "Prospects for pumped-hydro storage in Germany," EWL Working Papers 1107, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Dec 2011.
  12. Meyerhoff, Jürgen & Ohl, Cornelia & Hartje, Volkmar, 2010. "Landscape externalities from onshore wind power," Energy Policy, Elsevier, vol. 38(1), pages 82-92, January.

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