Local Impacts of Wind Farms on Property Values: A Spatial Difference-In-Differences Analysis

Over the last two decades, fostered by strong financial incentives, wind power in Germany has seen a rapid market diffusion. The promotion policy in the form of guaranteed feed-in tariffs for renewable energies such as wind power often rewarded investors in these technologies with extraordinary economic returns. However, today’s investment decisions in large-scale onshore wind power projects in Germany are no longer determined only by the investment’s economic benefit, but also by the mitigation of public concerns and thereby the increase of social acceptance. Despite a mostly positive attitude towards the expansion of wind power, local public concerns refer to the common assumption that the proximity to large-scale wind farms devalues property prices in the surroundings. In addition, the average hub height and rotor diameter of newly constructed wind turbines have increased tremendously over the last years, causing a substantial change in the landscape of the affected regions. In turn, the change in the landscape can be supposed to have an impact on the view of those properties that are affected by the construction of a wind farm in their proximity, and thus exert a negative impact on the properties’ value. The aim of this study is to investigate local visibility impacts of wind farms on the development of property prices. Overall, four wind farm sites located in the federal state of North Rhine-Westphalia, Germany, are investigated.