Using the contingent valuation method, this study investigates the preferences of local people for a wind farm that is planned in the Province of Rome. We estimate the reductions over a period of time in bimonthly electricity bills that respondents would be willing to accept as compensation for the installation of the wind farm. Our results suggest that respondents who perceive that the wind farm generates substantial negative impacts on the beauty of the landscape ask higher reductions than others, while respondents who believe that the wind farm produces economic benefits for local communities ask lower reductions. Finally, we find that the demand for compensatory measures is influenced particularly by socio-economic factors such as age and education.
Keywords: Renewable energy, wind farm, rural communities, stated-preference, contingent valuation, willingness to accept
Jel Code: C83, Q20, Q40, Q51