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Solar Bait: How U.S. States Attract Solar Investments from Large Corporations

Author

Listed:
  • Jed J. Cohen

    (The Energy Institute at Johannes Kepler University)

  • Levan Elbakidze

    (Division of Resource Economics and Management and the Center for Innovation in Gas Research and Utilization, West Virginia University)

  • Randall Jackson

    (Geology and Geography Department and Regional Research Institute, West Virginia University)

Abstract

Past solar adoption literature has focused primarily on households without significant attention to the potential of commercial properties as sites for solar generation. We examine firms’ decisions to install solar panels on their properties using state and firm level data from the U.S. We are interested in the effects of state level characteristics, including policies and regulations, on firm decisions regarding solar investments. We find that state characteristics that influence the return-on-investment from solar installations, most notably solar intensity, are important for commercial adoption decisions. Further, the results suggest that certain state level policies, including solar carve-outs in renewable portfolio standards, financing programs and tax breaks, can incentivize firms to install solar panels. Across different model specifications, we observe that firm installation decisions are correlated with personal electric vehicle ownership rates. This may indicate a ‘green’ business marketing strategy, whereby firms install solar to improve their social responsibility image.

Suggested Citation

  • Jed J. Cohen & Levan Elbakidze & Randall Jackson, 2020. "Solar Bait: How U.S. States Attract Solar Investments from Large Corporations," Working Papers Working Paper 2020-01, Regional Research Institute, West Virginia University.
    • Handle: RePEc:rri:wpaper:2020wp01
    DOI: 10.5547/01956574.41.2.jcoh
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    Cited by:

    1. Yunguo Lu & Lin Zhang, 2023. "Environmental information disclosure and firm production: evidence from the estimated efficiency of publicly listed firms in China," Journal of Productivity Analysis, Springer, vol. 59(1), pages 99-119, February.
    2. Shan, Rui & Kittner, Noah, 2025. "Sector-specific strategies to increase green hydrogen adoption," Renewable and Sustainable Energy Reviews, Elsevier, vol. 214(C).
    3. Wilson, Christian & Caldecott, Ben, 2023. "Investigating the role of passive funds in carbon-intensive capital markets: Evidence from U.S. bonds," Ecological Economics, Elsevier, vol. 209(C).
    4. Hirsh Bar Gai, Dor & Shittu, Ekundayo & Attanasio, Donna & Weigelt, Carmen & LeBlanc, Saniya & Dehghanian, Payman & Sklar, Scott, 2021. "Examining community solar programs to understand accessibility and investment: Evidence from the U.S," Energy Policy, Elsevier, vol. 159(C).
    5. Jed J. Cohen & Levan Elbakidze & Randall Jackson, 2022. "Interstate protectionism: the case of solar renewable energy credits," American Journal of Agricultural Economics, John Wiley & Sons, vol. 104(2), pages 717-738, March.
    6. Hancevic, Pedro I. & Sandoval, Hector H., 2023. "Solar panel adoption among Mexican small and medium-sized commercial and service businesses," Energy Economics, Elsevier, vol. 126(C).
    7. Pedro I. Hancevic & Hector H. Sandoval, 2023. "Solar Panel Adoption in SMEs in Emerging Countries," Working Papers 222, Red Nacional de Investigadores en Economía (RedNIE).
    8. Cohen, Jed J. & Azarova, Valeriya & Kollmann, Andrea & Reichl, Johannes, 2021. "Preferences for community renewable energy investments in Europe," Energy Economics, Elsevier, vol. 100(C).

    More about this item

    Keywords

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    JEL classification:

    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources

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