IDEAS home Printed from https://ideas.repec.org/p/bon/boncrc/crctr224_2021_300.html
   My bibliography  Save this paper

The Economic Costs of NIMBYism - Evidence From Renewable Energy Projects

Author

Listed:
  • Stephen Jarvis

Abstract

Large infrastructure projects can create widespread societal benefits, but also fre- quently prompt strong local opposition. This is sometimes pejoratively labeled NIMBY (Not In My Backyard) behavior. In this paper I estimate the economic costs of NIMBYism and its role in local planning decisions. To do this I use de- tailed data on all major renewable energy projects proposed in the United Kingdom spanning three decades. First, I use hedonic methods to show that wind projects impose significant negative local costs, while solar projects do not. I then show that planning officials are particularly responsive to the local costs imposed within their jurisdictions, but fail to account for variation in these costs across jurisdic- tions. The result has been a systematic misallocation of investment, which may have increased the cost of deploying wind power by 10-29%. Much of this can be attributed to the fragmented and localized nature of the planning process.

Suggested Citation

  • Stephen Jarvis, 2021. "The Economic Costs of NIMBYism - Evidence From Renewable Energy Projects," CRC TR 224 Discussion Paper Series crctr224_2021_300, University of Bonn and University of Mannheim, Germany.
    • Handle: RePEc:bon:boncrc:crctr224_2021_300
    as

    Download full text from publisher

    File URL: https://www.crctr224.de/research/discussion-papers/archive/dp300
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Tanaka, Shinsuke & Zabel, Jeffrey, 2018. "Valuing nuclear energy risk: Evidence from the impact of the Fukushima crisis on U.S. house prices," Journal of Environmental Economics and Management, Elsevier, vol. 88(C), pages 411-426.
    2. Sunak, Yasin & Madlener, Reinhard, 2016. "The impact of wind farm visibility on property values: A spatial difference-in-differences analysis," Energy Economics, Elsevier, vol. 55(C), pages 79-91.
    3. Leah C. Stokes, 2016. "Electoral Backlash against Climate Policy: A Natural Experiment on Retrospective Voting and Local Resistance to Public Policy," American Journal of Political Science, John Wiley & Sons, vol. 60(4), pages 958-974, October.
    4. Gibbons, Stephen, 2015. "Gone with the wind: Valuing the visual impacts of wind turbines through house prices," Journal of Environmental Economics and Management, Elsevier, vol. 72(C), pages 177-196.
    5. James T. Hamilton, 1993. "Politics and Social Costs: Estimating the Impact of Collective Action on Hazardous Waste Facilities," RAND Journal of Economics, The RAND Corporation, vol. 24(1), pages 101-125, Spring.
    6. Michael Greenstone & Enrico Moretti, 2003. "Bidding for Industrial Plants: Does Winning a 'Million Dollar Plant' Increase Welfare?," NBER Working Papers 9844, National Bureau of Economic Research, Inc.
    7. Stephen Gibbons & Susana Mourato & Guilherme Resende, 2014. "The Amenity Value of English Nature: A Hedonic Price Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 57(2), pages 175-196, February.
    8. Costa, Hélia & Veiga, Linda, 2021. "Local labor impact of wind energy investment: An analysis of Portuguese municipalities," Energy Economics, Elsevier, vol. 94(C).
    9. Severin Borenstein & James B. Bushnell, 2022. "Do Two Electricity Pricing Wrongs Make a Right? Cost Recovery, Externalities, and Efficiency," American Economic Journal: Economic Policy, American Economic Association, vol. 14(4), pages 80-110, November.
    10. Pfenninger, Stefan & Staffell, Iain, 2016. "Long-term patterns of European PV output using 30 years of validated hourly reanalysis and satellite data," Energy, Elsevier, vol. 114(C), pages 1251-1265.
    11. Raffaella Sadun, 2015. "Does Planning Regulation Protect Independent Retailers?," The Review of Economics and Statistics, MIT Press, vol. 97(5), pages 983-1001, December.
    12. Lang, Corey & Opaluch, James J. & Sfinarolakis, George, 2014. "The windy city: Property value impacts of wind turbines in an urban setting," Energy Economics, Elsevier, vol. 44(C), pages 413-421.
    13. Staffell, Iain & Pfenninger, Stefan, 2016. "Using bias-corrected reanalysis to simulate current and future wind power output," Energy, Elsevier, vol. 114(C), pages 1224-1239.
    14. Ben Hoen & Carol Atkinson-Palombo, 2016. "Wind Turbines, Amenities and Disamenities: A Study of Home Value Impacts in Densely Populated Massachusetts," Journal of Real Estate Research, American Real Estate Society, vol. 38(4), pages 473-504.
    15. Roddis, Philippa & Carver, Stephen & Dallimer, Martin & Norman, Paul & Ziv, Guy, 2018. "The role of community acceptance in planning outcomes for onshore wind and solar farms: An energy justice analysis," Applied Energy, Elsevier, vol. 226(C), pages 353-364.
    16. Mitchell, Robert Cameron & Carson, Richard T, 1986. "Property Rights, Protest, and the Siting of Hazardous Waste Facilities," American Economic Review, American Economic Association, vol. 76(2), pages 285-290, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Oto-Peralías, Daniel & Cuberes, David, 2023. "Land Concentration and Mega Photovoltaic Plants," OSF Preprints hakt5, Center for Open Science.
    2. Dong, Luran & Lang, Corey, 2022. "Do views of offshore wind energy detract? A hedonic price analysis of the Block Island wind farm in Rhode Island," Energy Policy, Elsevier, vol. 167(C).
    3. Olivier J Blanchard & Christian Gollier & Jean Tirole, 2022. "The portfolio of economic policies needed to fight climate change," Working Paper Series WP22-18, Peterson Institute for International Economics.
    4. Mirosława Witkowska-Dabrowska & Natalia Świdyńska & Agnieszka Napiórkowska-Baryła, 2021. "Attitudes of Communities in Rural Areas towards the Development of Wind Energy," Energies, MDPI, vol. 14(23), pages 1-24, December.
    5. Hideki Shimada & Kenji Asano & Yu Nagai & Akito Ozawa, 2022. "Assessing the Impact of Offshore Wind Power Deployment on Fishery: A Synthetic Control Approach," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 83(3), pages 791-829, November.
    6. Blanchard, Olivier Jean & Gollier, Christian & Tirole, Jean, 2022. "Fighting the war against climate change," TSE Working Papers 22-1360, Toulouse School of Economics (TSE).
    7. Elmallah, Salma & Hoen, Ben & Fujita, K. Sydny & Robson, Dana & Brunner, Eric, 2023. "Shedding light on large-scale solar impacts: An analysis of property values and proximity to photovoltaics across six U.S. states," Energy Policy, Elsevier, vol. 175(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Frondel, Manuel & Kussel, Gerhard & Sommer, Stephan & Vance, Colin, 2019. "Local cost for global benefit: The case of wind turbines," Ruhr Economic Papers 791, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen, revised 2019.
    2. Dong, Luran & Lang, Corey, 2022. "Do views of offshore wind energy detract? A hedonic price analysis of the Block Island wind farm in Rhode Island," Energy Policy, Elsevier, vol. 167(C).
    3. Pates, Nicholas J. & Kim, GwanSeon & Mark, Tyler B. & Ritter, Matthias, 2020. "Windfalls or wind falls? The Local Effects of Turbine Development on US Agricultural Land Values," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304611, Agricultural and Applied Economics Association.
    4. Hans Westlund & Mats Wilhelmsson, 2021. "The Socio-Economic Cost of Wind Turbines: A Swedish Case Study," Sustainability, MDPI, vol. 13(12), pages 1-16, June.
    5. Jensen, Cathrine Ulla & Panduro, Toke Emil & Lundhede, Thomas Hedemark & Nielsen, Anne Sofie Elberg & Dalsgaard, Mette & Thorsen, Bo Jellesmark, 2018. "The impact of on-shore and off-shore wind turbine farms on property prices," Energy Policy, Elsevier, vol. 116(C), pages 50-59.
    6. Sascha Samadi, 2017. "The Social Costs of Electricity Generation—Categorising Different Types of Costs and Evaluating Their Respective Relevance," Energies, MDPI, vol. 10(3), pages 1-37, March.
    7. Shoeib, Eman Ahmed Hamed & Hamin Infield, Elisabeth & Renski, Henry C., 2021. "Measuring the impacts of wind energy projects on U.S. rural counties’ community services and cost of living," Energy Policy, Elsevier, vol. 153(C).
    8. Dong, Luran & Gaur, Vasundhara & Lang, Corey, 2023. "Property value impacts of onshore wind energy in New England: The importance of spatial heterogeneity and temporal dynamics," Energy Policy, Elsevier, vol. 179(C).
    9. Jan von Detten & Johann V. Seebaß & Jan C. Schlüter & Florian Hackelberg, 2023. "Influence of onshore wind turbines on land values [Einfluss von Onshore-Windenergieanlagen auf den Grundstückswert]," Zeitschrift für Immobilienökonomie (German Journal of Real Estate Research), Springer;Gesellschaft für Immobilienwirtschaftliche Forschung e. V., vol. 9(1), pages 63-80, April.
    10. Dröes, Martijn I. & Koster, Hans R.A., 2021. "Wind turbines, solar farms, and house prices," Energy Policy, Elsevier, vol. 155(C).
    11. Carr-Harris, Andrew & Lang, Corey, 2019. "Sustainability and tourism: the effect of the United States’ first offshore wind farm on the vacation rental market," Resource and Energy Economics, Elsevier, vol. 57(C), pages 51-67.
    12. Zerrahn, Alexander, 2017. "Wind Power and Externalities," Ecological Economics, Elsevier, vol. 141(C), pages 245-260.
    13. Wehrle, Sebastian & Gruber, Katharina & Schmidt, Johannes, 2021. "The cost of undisturbed landscapes," Energy Policy, Elsevier, vol. 159(C).
    14. Costa, Hélia & Veiga, Linda, 2021. "Local labor impact of wind energy investment: An analysis of Portuguese municipalities," Energy Economics, Elsevier, vol. 94(C).
    15. Germeshausen, Robert & Heim, Sven & Wagner, Ulrich J., 2021. "Support for renewable energy: The case of wind power," ZEW Discussion Papers 21-074, ZEW - Leibniz Centre for European Economic Research.
    16. Caporale, Diana & Sangiorgio, Valentino & Amodio, Alessandro & De Lucia, Caterina, 2020. "Multi-criteria and focus group analysis for social acceptance of wind energy," Energy Policy, Elsevier, vol. 140(C).
    17. Lehmann, Paul & Reutter, Felix & Tafarte, Philip, 2021. "Optimal siting of onshore wind turbines: Local disamenities matter," UFZ Discussion Papers 4/2021, Helmholtz Centre for Environmental Research (UFZ), Division of Social Sciences (ÖKUS).
    18. Lutzeyer, Sanja & Phaneuf, Daniel J. & Taylor, Laura O., 2018. "The amenity costs of offshore wind farms: Evidence from a choice experiment," Energy Economics, Elsevier, vol. 72(C), pages 621-639.
    19. Yingdan Mei & Pengfei Liu & Lina Meng & Lu Lin, 2024. "Evaluate the Impacts of Wind Farm Facilities on Land Values with Geographically-Linked Microdata in China," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 87(2), pages 465-489, February.
    20. Maria De Salvo & Sandra Notaro & Giuseppe Cucuzza & Laura Giuffrida & Giovanni Signorello, 2021. "Protecting the Local Landscape or Reducing Greenhouse Gas Emissions? A Study on Social Acceptance and Preferences towards the Installation of a Wind Farm," Sustainability, MDPI, vol. 13(22), pages 1-19, November.

    More about this item

    Keywords

    Infrastructure; Electricity; Renewables; NIMBY; Local; Planning;
    All these keywords.

    JEL classification:

    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • R30 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bon:boncrc:crctr224_2021_300. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CRC Office (email available below). General contact details of provider: https://www.crctr224.de .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.