Does the Introduction of Wind Turbines Have an Impact on Surrounding Property Prices? A Hedonic Difference-In-Differences Approach

Abstract: The Swedish government has the ambition to increase the usage of renewable energy sources in Sweden. Wind power development is one of many key elements needed to achieve that goal. This thesis has investigated if the introduction of wind turbines in an area have an impact on surrounding property prices. An extensive dataset covering the years 2010-2017 was used, which included 156 082 real estate transactions and 1 011 wind turbines located all over Sweden. Applying a hedonic difference-in-differences approach, our results indicate that property prices decline on average by 2-4% after a wind turbine has been introduced within 2 km of a property. We can also show that the effect increases in strength as the proximity to the wind turbine increases. This thesis contributes with some new insights into this issue, but more research on this topic is needed. Furthermore, our findings do not oppose further wind power development in Sweden. Instead, they illustrate an important issue that may increase in importance as Sweden is transforming its energy production towards renewable energy sources.