The Impact of Wind Power Projects on Residential Property Values ...

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Abstract With wind energy expanding rapidly in the U.S. and abroad, and with an increasing number <strong>of</strong> communities considering wind power development nearby, there is an urgent need to empirically investigate common community concerns about wind project development. <strong>The</strong> concern that property values will be adversely affected by wind energy facilities is commonly put forth by stakeholders. Although this concern is not unreasonable, given property value impacts that have been found near high voltage transmission lines and other electric generation facilities, the impacts <strong>of</strong> wind energy facilities on residential property values had not previously been investigated thoroughly. <strong>The</strong> present research collected data on almost 7,500 sales <strong>of</strong> singlefamily homes situated within 10 miles <strong>of</strong> 24 existing wind facilities in nine different U.S. states. <strong>The</strong> conclusions <strong>of</strong> the study are drawn from eight different hedonic pricing models, as well as both repeat sales and sales volume models. <strong>The</strong> various analyses are strongly consistent in that none <strong>of</strong> the models uncovers conclusive evidence <strong>of</strong> the existence <strong>of</strong> any widespread property value impacts that might be present in communities surrounding wind energy facilities. Specifically, neither the view <strong>of</strong> the wind facilities nor the distance <strong>of</strong> the home to those facilities is found to have any consistent, measurable, and statistically significant effect on home sales prices. Although the analysis cannot dismiss the possibility that individual homes or small numbers <strong>of</strong> homes have been or could be negatively impacted, it finds that if these impacts do exist, they are either too small and/or too infrequent to result in any widespread, statistically observable impact. iii
Table <strong>of</strong> Contents List <strong>of</strong> Tables ................................................................................................................................. vi List <strong>of</strong> Figures............................................................................................................................... vii Acknowledgements......................................................................................................................viii Executive Summary....................................................................................................................... ix 1. Introduction............................................................................................................................. 1 2. Previous Research................................................................................................................... 4 2.1. Hedonic Models and Environmental Disamenities......................................................... 4 2.2. <strong>Impact</strong>s <strong>of</strong> <strong>Wind</strong> <strong>Projects</strong> on Property Values................................................................ 6 3. Data Overview ...................................................................................................................... 10 3.1. Site Selection ................................................................................................................ 10 3.2. Data Collection ............................................................................................................. 13 3.2.1. Tabular Data.......................................................................................................... 13 3.2.2. GIS Data................................................................................................................ 15 3.2.3. Field Data.............................................................................................................. 15 3.2.4. Field Data Collection ............................................................................................ 18 3.3. Data Summary .............................................................................................................. 18 4. Base Hedonic Model............................................................................................................. 23 4.1. Dataset........................................................................................................................... 23 4.2. Model Form .................................................................................................................. 24 4.3. Analysis <strong>of</strong> Results ....................................................................................................... 28 5. Alternative Hedonic Models ................................................................................................. 33 5.1. View and Distance Stability Models............................................................................. 33 5.1.1. Dataset and Model Form....................................................................................... 34 5.1.2. Analysis <strong>of</strong> Results ............................................................................................... 35 5.2. Continuous Distance Model.......................................................................................... 36 5.2.1. Dataset and Model Form....................................................................................... 36 5.2.2. Analysis <strong>of</strong> Results ............................................................................................... 37 5.3. All Sales Model............................................................................................................. 37 5.3.1. Dataset and Model Form....................................................................................... 38 5.3.2. Analysis <strong>of</strong> Results ............................................................................................... 39 5.4. Temporal Aspects Model.............................................................................................. 42 5.4.1. Dataset and Model Form....................................................................................... 42 5.4.2. Analysis <strong>of</strong> Results ............................................................................................... 44 5.5. Orientation Model......................................................................................................... 47 5.5.1. Dataset and Model Form....................................................................................... 47 5.5.2. Analysis <strong>of</strong> Results ............................................................................................... 49 5.6. Overlap Model .............................................................................................................. 50 5.6.1. Dataset and Model Form....................................................................................... 51 5.6.2. Analysis <strong>of</strong> Results ............................................................................................... 52 6. Repeat Sales Analysis ........................................................................................................... 55 6.1. Repeat Sales Models and Environmental Disamenities Literature............................... 55 iv
Page 1 and 2: LBNL-2829E ERNEST ORLANDO LAWRENCE
Page 3: LBNL-2829E The <st
Page 7 and 8: List of Tables Tab
Page 9 and 10: Acknowledgements The</stron
Page 11 and 12: This report builds on the previous
Page 13 and 14: Table ES-2: Impact
Page 15 and 16: Figure ES-3: Base Model Results: Sc
Page 17 and 18: In the Distance Stability Model, fo
Page 19 and 20: 1. Introduction Wind</stron
Page 21 and 22: model 7 and uses various forms <str
Page 23 and 24: A particularly useful application <
Page 25 and 26: Using different statistical methods
Page 27 and 28: Table 1: Summary of</strong
Page 29 and 30: By using a variety of</stro
Page 31 and 32: minimum of 164 fee
Page 33 and 34: 3.2.2. GIS Data GIS data on parcel
Page 35 and 36: In addition to the qualitative VIEW
Page 37 and 38: with the rest of t
Page 39 and 40: Figure 4: Frequency of</str
Page 41 and 42: 4. Base Hedonic Model This section
Page 43 and 44: impose the least structure on the u
Page 45 and 46: of the home, home
Page 47 and 48: etween the reference study area (WA
Page 49 and 50: Figure 7: Results from the Base Mod
Page 51 and 52: 5. Alternative Hedonic Models <stro
Page 53 and 54: concentrated inside of</str
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all other components are as defined
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the distance from them might not oc
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explanation is that the additional
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6) More than four years after const
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Table 19: Results from Temporal Asp
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Turning to the coefficient differen
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Table 21: Frequency Crosstab <stron
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5.6.1. Dataset and Model Form Data
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with the scenic vista. In other wor
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6. Repeat Sales Analysis In general
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Table 27: List of
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adjustment, and represent another t
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that are located within one mile <s
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7. Sales Volume Analysis Th
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Figure 11: Sales Volumes by PERIOD
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three years before announcement), a
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8. Wind Pr
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Drawing from the previous literatur
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Taken together, the results from al
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9. Conclusions Though surveys gener
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Davis, L. W. (2008) The</st
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LeSage, J. P. (1999) The</s
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Watson, M. (2005) Estimation <stron
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Figure A - 1: Map of</stron
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all very small communities with lit
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A.2 TXHC Study Area: Howard County
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Census Statistics Name Type 2007 Po
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Data Collection and Summary County
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A.4 IABV Study Area: Buena Vista Co
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Variables of Inter
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facilities than the towns o
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A.6 WIKCDC Study Area: Kewaunee and
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Variables of Inter
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elatively high elevations o
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A.8 PAWC Study Area: Wayne County (
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Census Statistics Name Type 2007 Po
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ural landscapes, with the largest p
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A.10 NYMC Study Area: Madison Count
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Variables of Inter
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account, combined with the determin
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Appendix C: Field Data Collection I
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Figure A - 14: Field Data Collectio
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ABOVE AVERAGE VISTA PREMIUM VISTA 1
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EXTREME VIEW 6 turbines visible fro
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5 is a vector of d
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values, that effect seems likely to
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unrestricted Home and Site Characte
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with coefficients above zero and th
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Figure A - 15: Histogram of
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The M Distance his
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sold within the preceding six month
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Appendix H: Alternative Models: Ful
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Table A - 8: Full Results for the C
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Table A - 10: Full Results for the
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Table A - 11: Full Results for the
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