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Economic and environmental implications of hydropower concession renewals: A case study in Southern France

Author

Listed:
  • Federico Pontoni

    (IEFE - Center for Research on Energy and Environmental Economics and Policy (University Luigi Bocconi of Milan))

  • Anna Creti

    (LEDa - Laboratoire d'Economie de Dauphine - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres)

  • Marc Joëts

    (Centre de recherche de la Banque de France - Banque de France, EconomiX - EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)

Abstract

In the coming years, a consistent number of French hydropower concessions will be re-assigned through a competitive public procedure, in which bidders will submit an environmental offer and an economic one. This procedure is likely to generate a trade-off between monetary transfers and environmental pledges. In particular, we expect bidders to couple higher monetary compensation to local authorities with lower mitigation measures and vice-versa. This paper aims at investigating the reasons under which local authorities would prefer either environmental protection or monetary transfers. Through an innovative discrete choice experiment (DCE) carried out in the Aspe valley, where more than 100 MW of hydro capacity is installed, we translate monetary offers into immediate rebates on the electricity bill and we test whether local respondents prefer higher rebates or stronger environmental improvements. From a methodological perspective, we calculate our results both with the standard preference space approach and with the WTP space approach. According to our results, locals value considerably more environmental pledges than monetary offers; hence, we argue that bidders should give clear priority to environmental mitigation measures.

Suggested Citation

  • Federico Pontoni & Anna Creti & Marc Joëts, 2018. "Economic and environmental implications of hydropower concession renewals: A case study in Southern France," Post-Print hal-02302550, HAL.
  • Handle: RePEc:hal:journl:hal-02302550
    DOI: 10.3917/reco.pr2.0116
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    Cited by:

    1. Lina Yousry & Yixin Cao & Bruno Marmiroli & Olivier Guerri & Guillaume Delaunay & Olivier Riquet & Karl Matthias Wantzen, 2022. "A Socio-Ecological Approach to Conserve and Manage Riverscapes in Designated Areas: Cases of the Loire River Valley and Dordogne Basin, France," Sustainability, MDPI, vol. 14(24), pages 1-38, December.

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