Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/297263 
Authors: 
Year of Publication: 
2023
Series/Report no.: 
IFN Working Paper No. 1467
Publisher: 
Research Institute of Industrial Economics (IFN), Stockholm
Abstract: 
Local resistance towards wind power is a central challenge for the energy transition, implying that legally imposed compensation schemes for nearby residents may become more prevalent in the near future. In this study, I use GIS-coded data on detached residential buildings in Sweden to simulate a variety of revenue sharing schemes applied to every present and planned commercial scale wind power project, with a focus on documenting the impact on investor costs. I compare models that entitle compensation for distance between six and ten times the tip height of the closest turbine, imposing schemes that are both constant within the eligible distance, as well as declining with distance from the turbine. An important conclusion is that costs vary considerably depending on the model chosen. When compensations are awarded for residents as far away as ten times the turbine height, foregone revenues exceed two percent for a large share of the projects, potentially necessitating the inclusion of a regulated cap on compensation costs.
Subjects: 
Wind power
negative externalities
local acceptance
energy transition
NIMBYism
JEL: 
H23
D62
D4
P18
P48
Document Type: 
Working Paper

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