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How do wind turbines impact property values in the US?

The transition to a decarbonized energy system, with an emphasis on environmental sustainability, has put renewable energy sources like wind power at the forefront of efforts to replace fossil fuels and combat climate change

However, despite the rapid growth of wind energy as a prominent renewable source, its deployment often faces hurdles, notably due to local opposition related to the physical intrusion and aesthetic impact of wind turbines.

Wind power and property values 

A comprehensive study offers a deep dive into the complexities surrounding the local impacts of wind turbines, particularly focusing on how their visibility can influence property values in communities across the United States. 

The research was conducted by an international team of scientists from the CMCC Foundation, the Potsdam Institute for Climate Impact Research (PIK), and the University of California at Berkeley

Debates on renewable energy growth

The investigation is critical for understanding the nuanced trade-offs between renewable energy’s environmental benefits and its local effects, potentially reshaping discussions around renewable energy development.

“This situation is a classic ‘Not In My Backyard’ problem, which leads to extensive policy debates on renewable energy growth,” said lead author Wei Guo, a researcher at CMCC and the European Institute on Economics and the Environment (EIEE). 

“In the big picture, the economic solution is about finding a balance between the global environmental benefits of renewable energy and the local impacts on communities nearby.”

Impact of wind turbines on local communities 

The research takes an innovative step by focusing on the often-overlooked aspect of wind turbines’ impact on local communities, specifically how their presence in the landscape can affect the valuation of nearby homes. 

By constructing a comprehensive database detailing the visibility of wind turbines – including their location, height, and the surrounding topography – the study leverages hedonic valuation theory to statistically estimate the effects of wind turbine visibility on home values, utilizing an extensive dataset covering the majority of U.S. home sales since 1997.

Depreciation of property values

The findings reveal a discernible negative impact on property values within an 8 km radius of visible wind turbines, an effect that diminishes with increased distance and over time post-installation. In addition, the researchers found that seeing a windmill closer than two kilometers can lower a house’s value by up to 8 percent.

“To picture this, imagine holding a golf ball at arm’s length – that is roughly how big a wind turbine looks from that distance,” Guo explained.

“However, as one moves further from the windmill, its impact on house values drops off quickly. From 8 kilometers away, a wind turbine looks about as big as an aspirin tablet at arm’s length, and at this distance, it doesn’t really affect what people think their homes are worth.”

The experts calculated a total depreciation of US $24.5 billion in property values for U.S. homes with views of wind turbines, a figure that, while substantial, represents only a minor fraction of the over $45 trillion total value of all homes in the U.S. in 2022. 

How renewable energy affects local communities

According to Guo, “although houses close to wind turbines can lose some value due to the disrupted view, the impacts are just a small part in the grand theme of all houses, and we expect it to become even less of an issue in the future.”

“This project stands at the cutting edge of understanding how renewable energy affects local communities. It is like putting on a new pair of glasses to look at how wind power impacts people’s lives and homes.”

Nationwide evaluation of wind power

This groundbreaking study not only provides a nationwide evaluation of wind power generation’s external costs but also introduces methodological innovations by considering the actual visibility of turbines from residences, a significant step forward in the field of environmental economics and policy research.

“Personally, living in northern California for the past five years, I have seen firsthand how local people can be hesitant or opposed to new wind turbines projects. This sparked my interest in this field of research,” said Guo.

“For me, this project is more than just an academic study. It’s about addressing a real-world issue that I’ve observed, and using my expertise to shed light on a topic that affects many people’s lives.”

The study is published in the journal Proceedings of the National Academy of Sciences.


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