Estimating Indirect Benefits: Fracking, Coal and Air Pollution

Reid Johnsen, Jacob LaRiviere and Hendrik Wolff ()
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Reid Johnsen: California Department of Tax and Finance Administration
Hendrik Wolff: Simon Fraser University

No 10170, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: This paper estimates indirect benefits of improved air quality induced by hydraulic fracturing, or "fracking". The recent increase in natural gas supply led to displacement of coal-fired electricity by cleaner natural gas-fired generation. Using detailed spatial panel data comprising the near universe of US power plants, we find that coal generation decreased by 28%. Further, fracking decreased local air pollution by an average of 4%. We show that benefits vary geographically; air pollution levels decreased by 35% in the most affected region. Back of the envelope calculations imply accumulated health benefits of roughly $17 billion annually.

Keywords: fracking; coal-fired power plants; air pollution; health; electricity (search for similar items in EconPapers)
JEL-codes: I18 Q41 Q53 (search for similar items in EconPapers)
Pages: 51 pages
Date: 2016-08
New Economics Papers: this item is included in nep-ene, nep-env and nep-reg
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Citations: View citations in EconPapers (2)

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