The Local Economic Impact of Wind Power Deployment

2016

Investment in wind power has grown remarkably in the past decades in the European Union, and in particular in Portugal. Although support for incentive policies is based on economic development arguments, little evidence exists as to their impact on overall job creation and local level effects. We assess the existence, distribution and duration of local level labor impacts of wind power investment using a panel of all 278 Portuguese mainland municipalities for the years 2001-2014. Our results show there are short term effects, mainly for low skilled labor, during the construction phase. We estimate a decrease of 0.37 percentage points in total unemployment rate for each 100MW installed. We find positive spatial spillovers for municipalities that are 30km or less away. We find no evidence of sustained effects or impact during the operations and maintenance phase. These insights highlight the need to couple incentive policies with labor market and educational reforms that reduce the mi...

Energy Economics, 2021

Investment in wind power has grown remarkably in the past decades in Portugal. Although economic development is an argument for investment incentive policies, little evidence exists as to their net impact on local-level unemployment. Using data for all 278 Portuguese mainland municipalities for the years 1997–2017, we assess the existence, distribution and duration of local-level labor impacts of wind power investment. Our results show there are short-term effects during the construction phase. We estimate a decrease of 0.17 and 0.23 percentage points in the total unemployment rate per 100 MW of installed power in each of the two years of the construction phase. These effects are felt mainly for unskilled labor and male workers. Further analysis of spatial interaction finds positive spatial spillovers for municipalities that are 30 km or less away but not farther, implying workers are willing to commute but not migrate. We find a very small sustained impact during the operations and maintenance phase, despite both short- and long-term impacts on municipalities' revenues.

2019

Renewable energy is a crucial element to mitigate the e ects of climate change, and wind power is an important resource because of its lower production cost and sustainability. Beyond the environmental dimension, the implementation of wind farms may impact local development. Due to the weather conditions, Brazil emerges as one of the leading countries in the generation of wind power. Thus, this paper aims we estimate the impacts of wind farms on the Brazilian local labor market, aggregating information from several data sources into a panel from 2002 and 2016. We analyze the impacts on the formal employment and wage levels, considering di erent sectors, educational level, and rm size. We explore the staggered process of expansion of wind farms among municipalities through the staggered Di erencein-Di erences (DiD) approach, and we apply the event-study framework to verify the e ects of duration and pre-intervention trends. The results suggest that wind farms increase the total level...

Renewable and Sustainable Energy Reviews, 2020

Wind power is an important source of renewable energy. Beyond the environmental dimension, the wind energy may contribute to the local development. Due to its weather conditions, Brazil emerges as one of the leading countries in the generation of wind power. This study estimates the impact of wind farms on the Brazilian labor market, through the exploration of the staggered nature of the sequential process of wind farm implantation between 2004 and 2016. We estimate the treatment effect parameters using a Difference--in--Differences (DiD) approach with: i) multiple time periods, ii) variation in treatment timing, and iii) dynamic treatment effects, through an event study design. We aggregate information from several data sources into a panel and we analyze the impact on employment and wages, by considering economic sectors, educational levels, and firm sizes. Our findings suggest that wind farms increase employment in the industry, agriculture and construction, and increase the wages in all economic sectors. Additionally, we find positive effects on the employment and wages of less--educated workers, and of small and medium--sized firms. The impact of this intervention can last for up to two years. Our results suggest that wind power may generate significant social impacts through the labor market, by contributing to local development and increasing social welfare in developing economies.

SSRN Electronic Journal

Any opinions expressed in this paper are those of the author(s) and not those of IZA. Research published in this series may include views on policy, but IZA takes no institutional policy positions. The IZA research network is committed to the IZA Guiding Principles of Research Integrity. The IZA Institute of Labor Economics is an independent economic research institute that conducts research in labor economics and offers evidence-based policy advice on labor market issues. Supported by the Deutsche Post Foundation, IZA runs the world's largest network of economists, whose research aims to provide answers to the global labor market challenges of our time. Our key objective is to build bridges between academic research, policymakers and society. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper should account for its provisional character. A revised version may be available directly from the author.

2014

Any opinions expressed here are those of the author(s) and not those of the institute. Research disseminated by IZA may include views on policy, but the institute itself takes no institutional policy positions. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit company supported by Deutsche Post World Net. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper shou...

Energy Policy, 2008

The positive impacts of an increasing share of renewable energies on the mitigation of climate change as well as on the decrease of the dependency of energy imports are indisputable. However, one persistent problem for the German economy has been its high level of unemployment in the recent past. Therefore, any policy strategy will be measured also by its net-impact on the labor market. The paper describes the results of a study that models this impact and is novel within three respects: Firstly, an Input-Output-Vector for the renewable energy sector was developed based on the results of more than 1000 interviews with an extensive questionnaire, secondly gross and net effect of two different policy scenarios for Germany until 2030 were calculated and thirdly the approach varies from earlier studies by its explicit modeling of export and foreign trade effects.

2014

Any opinions expressed here are those of the author(s) and not those of the institute. Research disseminated by IZA may include views on policy, but the institute itself takes no institutional policy positions. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit company supported by Deutsche Post World Net. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper shou...

2014

Any opinions expressed here are those of the author(s) and not those of the institute. Research disseminated by IZA may include views on policy, but the institute itself takes no institutional policy positions. The Institute for the Study of Labor (IZA) in Bonn is a local and virtual international research center and a place of communication between science, politics and business. IZA is an independent nonprofit company supported by Deutsche Post World Net. The center is associated with the University of Bonn and offers a stimulating research environment through its research networks, research support, and visitors and doctoral programs. IZA engages in (i) original and internationally competitive research in all fields of labor economics, (ii) development of policy concepts, and (iii) dissemination of research results and concepts to the interested public. IZA Discussion Papers often represent preliminary work and are circulated to encourage discussion. Citation of such a paper shou...

Energy for sustainable development , 2019

Wind power is an important technology in the transition towards a low carbon economy. This paper covers the regional impacts of wind power developments in a small German region. Wind power developments with a cumulative capacity of 63.1 MW which have been installed in 2017 in the Aachen region, generating 3901 GWh electricity from 2017 to 2037 lead to a regional value added of €50.8 million (or €805/kW). The avoided greenhouse gas emissions are 132,770 tCO 2-equivalents in 2017 and the total economic impacts of value added, avoided greenhouse gases and air pollution ranging from €20.9 to €24.6 million (€332-389 per kW or €107-126 per MWh electricity generated) in 2017. From an environmental economic view, the generation of wind power is the most beneficial electricity generation technology in comparison to PV and lignite.