Power to the People: The Local Economic Effects of Renewable Energy Communities in the UK

Gökhan Dilek () and Joël Bühler ()
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Gökhan Dilek: Department of Applied Economics, Public Policies Section (OAP- GiM), Universitat de Barcelona, Spain.
Joël Bühler: Department of Applied Economics, Public Policies Section (OAP- GiM), Universitat de Barcelona, Spain.

No 202604, IREA Working Papers from University of Barcelona, Research Institute of Applied Economics

Abstract: Local responses to renewable energy projects range from opposition that delays or blocks deployment to active support and participation. A common narrative underlying these behaviors emphasizes economic considerations: projects that impose local externalities without delivering local benefits tend to face resistance, whereas renewable energy communities (RECs) that are formed by citizens are argued to generate more local economic value than corporate plants. This paper examines these two related claims by comparing the local economic effects of community-owned and corporate-owned renewable energy plants. Using heterogeneity-robust difference-indifferences estimators and panel data for UK local authority districts, we estimate the income and employment impacts of community and corporate solar and wind projects. We find evidence of local economic benefits for some ownership–technology combinations, with substantial heterogeneity across ownership structures and technologies. Overall, the results point to a nuanced relationship between renewable energy deployment, ownership models, and local economic outcomes.

Keywords: The United Kingdom; Renewable Energy Communities; Energy Transition; Renewable Energy; Green Growth. JEL classification: C33; E24; J21; L94; O13; Q52; R23. (search for similar items in EconPapers)
Pages: 47 pages
Date: 2026-01
New Economics Papers: this item is included in nep-ppm and nep-reg
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Persistent link: https://EconPapers.repec.org/RePEc:ira:wpaper:202604

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