Not in my backyard? Wind turbines have little effect on US property values
“The impact of wind turbines on house prices is much smaller than generally feared: In the U.S., it’s about one percent for a house that has at least one wind turbine in a 10 km radius”, explains Maximilian Auffhammer, a Professor in the Department of Agricultural and Resource Economics at the University of California, Berkeley and co-author of the study. “And what really surprised me is that the house value bounces back to the original price over the years.” The study authors also found that there was no longer any effect for wind turbines built after 2017, which they suggest could be because people have gotten used to these new structures in their environment over time.
Data from 300 million home sales and 60,000 wind turbines
Wind power is one of the fastest-growing renewable energy sources worldwide. Yet, the implementation of wind energy infrastructure often faces significant challenges from local communities, partly from the perceived discomfort of having to see wind turbines and the assumed implications for property prices.
To find out whether the construction of a new wind turbine in the vicinity of houses influences the value of homes, scientists from the German Potsdam Institute for Climate Impact Research (PIK), the Italian Centro Euro-Mediterraneo sui Cambiamenti Climatici (CMCC) and the University of California, Berkeley analyzed the majority of home sales in the U.S. in the last 23 years. The researchers statistically analyzed data from more than 300 million home sales and 60,000 wind turbines from 1997 to 2020 to discern the impact of wind turbine visibility on home values.
“Unlike previous studies, we did not only consider proximity but also the actual visibility of wind turbines”, says Wei Guo, a CMCC researcher and first author of the study. “We calculated whether you can see the turbine – or whether there is a mountain in the way, for example – and if so, how the house value changes compared to other houses in the same area where residents cannot see the wind turbine.”
Contributing to more informed decision-making for both policymakers and the public
The results clearly show that the negative economic effect of wind turbine visibility decreases as distance increases: the value of a house can drop by up to 8 percent when a wind turbine is built less than 2 kilometers away. Yet, the researchers note that only a tiny fraction of properties are actually built within this distance: In the U.S., less than 250,000 buildings are constructed within 4 km, compared to about 8.5 million properties within 10 km. Even then, the study shows that the effect diminishes over time along two dimensions. First, the decrease in property value peaks three years after installation and then gets smaller over time. Second, more recently installed wind turbines have a smaller negative effect on property values. Both findings suggest that people get more and more accustomed to wind turbines.
“Our research responds to some arguments of local opposition against wind turbines, the classic 'Not In My Backyard' problem that is a hot topic not only in the U.S. but also in Europe and Germany”, explains Leonie Wenz, PIK scientist and co-author. “In the big picture, it’s about finding a balance between the global climatic benefits of renewable energy and the local impacts on communities nearby. Our estimates of how wind turbine visibility affects house values could be a basis for compensating local homeowners. However, our study also underlines that these impacts have been small in the last two decades, and that we can expect them to become even less of an issue in the future.”
Article: Wei Guo, Leonie Wenz, Maximilian Auffhammer (2024): To see or not to see: The visual (dis)amenity value of wind turbines. Proceedings of the National Academy of Sciences. [DOI: 10.1073/pnas.2309372121]
Weblink to the article once published: https://doi.org/10.1073/pnas.2309372121
JOURNAL
Proceedings of the National Academy of Sciences
METHOD OF RESEARCH
Data/statistical analysis
SUBJECT OF RESEARCH
Not applicable
ARTICLE TITLE
To see or not to see: The visual (dis)amenity value of wind turbines.
ARTICLE PUBLICATION DATE
18-Mar-2024
The costs of a changing landscape
A recent PNAS study explores how wind turbine visibility affects property values across the U.S. The study reveals that wind turbines close to homes can reduce their value by up to 8%, but this impact tends to fade over time and distance
Renewable energy sources are essential for transitioning towards a decarbonized energy system and making the electricity grid more environmentally sustainable. Clean energy alternatives like wind power can effectively replace fossil fuels, contributing to reduced air pollution and slow down climate change.
Wind power has emerged as the fastest-growing non-hydro renewable energy source worldwide. However, the implementation of wind energy infrastructure, including windmills, faces significant challenges. One major obstacle is the opposition from local communities.
Wind turbines, the primary components of wind power generation, can be noisy, obstruct sunlight, produce flickering lights, and disrupt scenic views. These concerns can lead to conflicts between renewable energy development and environmental preservation, potentially exacerbating existing social inequalities.
A study published in the journal Proceedings of the National Academy of Sciences (PNAS) by an international team of scientists, including researchers from CMCC, the Potsdam Institute for Climate Impact Research (PIK), and University of California at Berkeley, offers a comprehensive perspective on this issue, crucial for evaluating the trade-offs between the benefits and costs of renewable energy sources, and for gaining a thorough understanding of their impacts.
This study represents a unique evaluation of the externality costs of wind power generation, specifically focusing on the impact of visibility on property values across the United States.
“This situation is a classic 'Not In My Backyard' problem, which leads to extensive policy debates on renewable energy growth,” says Wei Guo, researcher at CMCC and EIEE, the European Institute on Economics and the Environment, and first author of the study. “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.”
The research focuses on the impact of wind power generation on local communities, which is usually overlooked. Specifically, the study addresses how wind turbines, when integrated into the landscape, influence the perceived value of homes by residents. The main aim is to contribute to the benefit and cost analysis of renewable energy development, facilitating more informed decision-making for both policymakers and the public regarding new projects.
In pursuit of this objective, the researchers have meticulously compiled a database on wind turbine visibility, incorporating details on the location and height of each utility-scale turbine that has contributed power to the U.S. grid. The database is complemented by a high-resolution elevation map, which accounts for the underlying topography of the landscape. Grounded in hedonic valuation theory, the researchers conducted statistical estimations to discern the impact of wind turbine visibility on home values. These estimations draw on data sourced from a comprehensive dataset covering the majority of home sales in the U.S.A. since 1997.
The study reveals that, on average, the visibility of wind turbines has a negative and economically significant impact on home values within proximity of less than 8 km. However, this effect becomes indistinguishable from zero at larger distances. Moreover, the impact is notably smaller for recently installed turbines and diminishes significantly over time following their installation. The findings shed light on the nuanced dynamics between renewable energy infrastructure and local property values, providing valuable insights for sustainable and community-friendly energy development.
The results of the study show that seeing a windmill closer than 2 kilometers away can lower a house’s value by up to 8%. “To picture this, imagine holding a golf ball at arm's length - that is roughly how big a wind turbine looks from that distance,” says Guo. “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 total loss in values across all US houses with a view of windmills adds up to a drop of US $24.5 billion. Although this is a significant loss, it amounts to a relatively small fraction when comparing it to the total value of all homes in the US – over $45 trillion in 2022.
“We conclude that 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 an issue in the future,” says Guo. “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.”
This research pioneered a comprehensive nationwide evaluation of the external costs of wind power generation, but it also marks a significant advancement in quantitative precision by considering not only proximity but also actual visibility of wind turbines from homes.
The creation of an extensive database utilizing advanced techniques from geography and cartography sciences is another innovative element of this research. By applying these methods to every utility-scale turbine and high-resolution elevation maps, the study integrates interdisciplinary areas, representing a substantial step forward in environmental economics and policy research.
“Personally, living in northern California for the past 5 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.”
JOURNAL
Proceedings of the National Academy of Sciences
ARTICLE TITLE
The visual effect of wind turbines on property values is small and diminishing in space and time
Point Blue releases comprehensive analysis for offshore wind energy development of California’s coast
New analysis identifies sites offshore from Mendocino, Humboldt, and Santa Barbara counties as having high wind energy potential and with lower potential environmental impacts
Petaluma, CA - Point Blue, a leader in environmental research and conservation, has released a new analysis aimed at guiding the sustainable development of offshore wind energy off the coast of California. The analysis identified sites offshore from Mendocino, Humboldt, and Santa Barbara counties as having high wind energy potential and with lower potential environmental impacts. The project represents a significant step forward in understanding how to balance renewable energy goals with the need to minimize impact to the marine environment and the communities that depend on it.
This report is released at a crucial time, with the California Energy Commission (CEC) soon to conclude the public comment period for the Offshore Wind Strategic Plan, pursuant to Assembly Bill 525. This plan is aimed at reaching Governor Newsom's proposed target of 25 GW by 2045.
The comprehensive analysis, spearheaded by Point Blue's team of experts, utilized updated spatial data to assess the potential impacts of offshore wind energy development on marine environment, and human uses of the ocean. The model inputs included 180 datasets of marine birds, mammals and turtles, fish, habitats, and human uses. In addition to these datasets, Point Blue received 191 responses from expert surveys to quantify sensitivity to offshore wind impacts for all species.
By combining data on species abundance, habitats, and human activities with expert-derived information on sensitivity to negative impacts, the analysis identifies areas that maximize energy generation potential while preserving ocean ecosystems and existing uses.
"Our goal is to provide decision-makers with the information they need to make informed choices about offshore wind energy development," says Dr. Jaime Jahncke, Director of the California Current Group at Point Blue. "We want to help California meet its renewable energy targets while minimizing harm to wildlife and habitats."
Key findings from the analysis include the identification of priority wind energy installation areas off Punta Gorda (Humboldt County), Point Arena (Mendocino County), and Point Conception (Santa Barbara County). These areas, selected based on rigorous modeling and optimization analyses, offer high energy production potential while minimizing impacts on species and habitats.
“One of the things that surprised us the most about the results was that there are some clear areas that have a good mix of high energy generation benefit and lower marine impacts. The big challenge will be making development there technically and economically feasible and ensuring conflicts with emerging uses like new shipping fairways are addressed,” said Cotton Rockwood, a Senior Marine Ecologist who led much of the analysis in the report.
The analysis also examined individual sea space regions identified in California’s AB525, which guides the California Energy Commission in the development of offshore wind resources. Within the priority areas identified in that legislation, the analysis identified AB525 Mendocino Area_1 sea space region as the highest priority area for the next phases of wind development offshore of California. In addition, portions of the Mendocino Area_2, and both Humboldt Area sea space regions should be considered high-priority for development plans to meet the AB525 2045 goals. These areas comprise waters with high energy production, balanced and minimized combined impacts to species, habitats and existing human uses and reasonable access to grid interconnection.
The analysis is intended to inform the roll-out of offshore wind in California that will occur in the coming decades, so it intentionally omits some current limits on the technical capacity for floating wind installation, like a maximum current depth of 1300m. That is because floating wind infrastructure is evolving rapidly and installation may well be possible in deeper waters well before future lease areas are developed. This means that important planning and investment decisions will determine whether deeper-water development can be achieved along with the lower impacts and greater benefits those areas accrue.
Funding for the report was provided by the Ocean Protection Council with additional support from the Gordon and Betty Moore Foundation and The David and Lucile Packard Foundation.
To read the full report, visit: https://www.pointblue.org/tools-and-guidance/research/updated-report-offshore-wind-energy-areas/
About Point Blue: Point Blue Conservation Science is a leading environmental research and conservation organization. Since 1965, Point Blue has been advancing conservation through science, partnerships, and outreach. Our highest priority is to reduce the impacts of accelerating changes in climate, land-use, and the sea while promoting climate-smart conservation for wildlife and people. For more information, visit www.PointBlue.org.
