Empowering Pennsylvania Communities to Participate in Wind Energy Development
By Max Harleman
Utility-scale onshore wind development has the potential to deliver carbon-free energy and economic benefits to rural economies in Pennsylvania. However, most local residents do not own wind turbines, are not employed by the industry, and do not receive land lease payments. Yet they fear or have faced negative effects related to quality of life, ecological impacts, and decreased property values. Community opposition has resulted in delayed or precluded wind projects. What can policymakers in Pennsylvania do to unlock the benefits of wind energy and foster the support of local residents?
Wind Energy Generation in Pennsylvania and its Potential
A study conducted by the National Renewable Energy Laboratory estimates that the technical capacity of onshore wind in Pennsylvania is 12 gigawatts, which represents roughly 5,000 utility-scale turbines. Under certain assumptions, annual economic generation potential could be as high as 3.2 terawatt hours, representing about 2 percent of annual consumption.i Although this percentage is low, simultaneously increasing wind, solar, and hydropower generation could result in a significant share of electricity coming from renewable sources. In the future, actual market potential for wind may be higher due to declining turbine costs and prevailing federal and state subsidies. Currently, Pennsylvania has 1.4 gigawatts of capacity installed at 27 farms. Wind is the state’s largest source of renewable energy, but it only accounts for about 1.6 percent of total electricity generation. However, capacity has nearly quadrupled since 2008 and more is currently in advanced stages of development.
The Benefits and Costs of Wind Power
Wind generation provides a number of widely dispersed benefits. A study by the Department of Energy concludes that expanding wind to 35 percent of national electricity demand by 2050 is technically achievable, and costs of deployment would be outweighed by over $800 billion in cumulative economic benefits associated with savings on electricity bills and avoiding damages from greenhouse gas emissions and fine particulate matter from burning fossil fuels. In Pennsylvania, wind projects would also provide direct economic benefits. In addition to gains for investors, the industry currently employs one to two thousand Pennsylvanians in manufacturing, installation, maintenance, and support services. Though payments vary, some residents have received $15 thousand to $20 thousand annually per turbine for leasing their land, and aggregate annual lease payments are between $1 million and $5 million.
Despite the benefits, local residents have faced or feared negative effects of wind generation. These effects represent costs related to diminished quality of life, ecological damage, and property value depreciation. Turbines create noise, which has caused annoyance and sleep disturbance that may lead to adverse health effects. Some residents also fear direct health effects from inaudible infrasound, though several peer-reviewed studies do not confirm this link. In addition, residents prefer views unmarred by turbines, and fear that they could spark fires if electrical equipment malfunctions or if turbines are struck by lightning. The installation of turbines and construction of related roads and facilities may impact local ecosystems, especially related to collisions of birds and bats and species displacement from fragmented natural habitats. In light of these impacts, some studies show adverse property value effects of turbines and turbine construction announcements in specific states, while other national studies find no such evidence. Still, residents near proposed sites do suffer from concern that their property values will erode.
Residents’ perceptions that they bear the social costs of development without sharing in the benefits have resulted in community opposition. Opposition during local zoning and permitting processes have delayed or prevented development in Pennsylvania and precluded projects in other states. For example, in rural Penn Forest Township residents voiced opposition to a 28 turbine project at a series of public hearings that lasted over two years. The process is still ongoing, as the municipal zoning board’s decision to deny the project was quickly appealed by the landowner of the project site.
Empowering Community Participation in Wind Development
Industry and government have recognized that active engagement of residents is necessary to overcome challenges posed by opposition. Although most developers employ information sessions and town hall meetings prior to zoning hearings, these methods often fail to build broad support. A plethora of literature suggests that meaningfully engaging residents and empowering them to invest in development engenders social acceptance. With this in mind, government officials in Pennsylvania should consider three policies to modify the default allocation of costs and benefits: community owned projects, preapproved development zones, and model ordinances.
Community wind projects are owned entirely by local individuals, organizations, and governments, or jointly with developers. Some solely sell energy into the grid to provide dividends for owners, while others involve a combination of sale and local consumption at reduced prices. In Denmark, which leads the world in wind generation per capita, at least forty percent of turbines belong to local owners and development receives high levels of public support. In 2011, the government passed a law requiring developers to offer shares (at cost) worth at least 20 percent of all new projects to residents within 4.5 km. Germany and the UK have pursued similar strategies, and social acceptance in these places has been stronger for projects that offer community ownership. To incentivize community ownership, Pennsylvania could require developers to offer shares locally, or provide resources to developers and communities to guide implementation of voluntary programs.
Preapproved development zones are intended to streamline the zoning and permitting processes. They establish areas where development presents minimal human and ecological impact, and preapprove it under prevailing permitting and zoning regulations over a set time frame. Currently, developers face regulatory environments that vary widely by state and municipality, which creates uncertainty for investors. In some cases, projects have been canceled due to regulatory changes during development. This is in part because many projects have been proposed near residential areas. Pennsylvania could utilize siting and risk assessment tools to identify and preapprove zones on sparsely populated state lands, such as game lands, and coordinate with municipal governments to preapprove turbines on private and locally-owned lands where development would have smaller impacts and face fewer objections.
Finally, model ordinances are draft land use regulations provided to municipalities by higher government authorities. Ordinances for wind development specify stipulations related to safety procedures, setbacks, noise requirements, and site reclamation. Pennsylvania already has a detailed model ordinance for wind, but no data exists on how many municipalities have used it to update their zoning codes. State officials could identify municipalities in high capacity areas that do not have modern wind ordinances, and engage residents to participate in updating them. Participation of residents in land use planning has been shown to alleviate perceptions of risk.
Preapproved development zones and model ordinances seem to be low-cost methods to engender community support. But in a difficult economic climate, community owned wind projects might not be feasible where residents have insufficient capital to invest in renewable energy projects. Therefore, any enacted policy should only require developers to offer shares at some minimum percentage. In addition, developers may oppose mandatory public offerings, which effectively reallocate profits and control to additional parties. In order to mitigate against losing investment to neighboring states, officials could embrace an industry relations strategy aimed at assuring developers that community projects can create a more stable environment for investment. Further, officials could consider incentivizing community projects with special tax exemptions, or adopting a feed-in-tariff program to provide more predictable returns. Clearly, Pennsylvania has the opportunity to take advantage an array of interrelated policy instruments to engender community support and unlock the benefits of wind energy.
Max Harleman is a PhD student at the University of Pittsburgh, Graduate School of Public and International Affairs. His research focuses on the governance of energy projects and their associated economic and environmental impacts on communities near development.
i. In its report, the National Renewable Energy Laboratory defines economic potential as: “the subset of the available resource technical potential where the cost required to generate the electricity (which determines the minimum revenue requirements for development of the resource) is below the revenue available in terms of displaced energy and displaced capacity.” Economic potential is measured under six cases with varying assumptions.