Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2014-09-18
Number: 14-124/VIII
Author-Name: Martijn I. Dröes
Author-Workplace-Name: University of Amsterdam, VU University Amsterdam, the Netherlands
Author-Name: Hans R.A. Koster
Author-Workplace-Name: VU University Amsterdam, the Netherlands
Title: Renewable Energy and Negative Externalities: The Effect of Wind Turbines on House Prices
Abstract: In many countries, wind turbines are constructed as part of a strategy to reduce dependence on fossil fuels. In this paper, we measure the external effect of wind turbines on the transaction prices of nearby houses. A unique house price dataset covering the period 1985-2011 is used, including the exact location of all wind turbines built in the Netherlands. We find that house prices within a two kilometer radius of a turbine, after it has been constructed, decrease by about 1.4 to 2.3 percent on average. We find anticipation effects up to three years in advance of the construction of a wind turbine. We provide further evidence that the external costs of a wind turbine are at least 10 percent of its construction cost.
Classification-JEL: L94, Q42, Q15, R31
Keywords: renewable energy; wind turbines; externalities; house prices
File-Url: https://papers.tinbergen.nl/14124.pdf
File-Format: application/pdf
File-Size: 1081603 bytes
Handle: RePEc:tin:wpaper:20140124