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Measuring the indirect costs associated with the establishment of a wind farm: An application of the Contingent Valuation Model

Author(s)
M. Du Preez, G. Menzies, M.C. Sale and S.G. Hosking
Publication date
November 2011
Although a green energy source, the location of electrical generating windmills may cause a disamenity effect (negative externality). The establishment of a wind farm is known as a locally undesirable land use (LULU) and leads to the not-in-my-backyard syndrome (NIMBY). In an application of the contingent valuation method, a willingness-to-accept framework was used to estimate the aggregate annual compensation required to allow the construction of a wind farm near Jeffrey’s Bay, South Africa. This compensation amounted to R490 695. A binary choice logit analysis found that retirement status, concern about climate change, concern about view-shed impacts and the offer amount are important predictors of voting for or against the project.
Publication PDF
Series title
Working Paper 258
Journal
2012, Journal of Energy in Southern Africa
JEL classifications