Local Economic Impact of Wind Energy Development: Analysis of the Regulatory Framework, Taxation, and Income for Galician Municipalities

Abstract

Wind energy has rapidly developed in the last decades, generating economic impacts at different territorial scales and contributing to rural development. However, few research works have analysed its economic impact at a local scale, especially in rural areas. Galicia is a Spanish region in which 3300 MW of wind energy have been installed in rural municipalities with low levels of socioeconomic activity and important socio-environmental problems. In this sense, the objective of this work is to analyse the local revenues directly derived from wind power activity in relation to changes in the regulatory framework (1995–2017), as well as to quantify those revenues for the year 2017. For this purpose, information has been systematically collected from secondary sources and complemented with 10 years of field and monitoring work on site at the wind farms. This article reveals the relationship between the regulatory framework and the main sources of income associated with wind power generation (conventional and specific taxes, municipal ownership, and other revenues). In 2017, these revenues amounted to 17.8 million euros. This work discusses how the public policies implemented during the analysed time period limited the direct economic impacts of the installation of wind farms on Galician rural municipalities, and consequently hindered rural development.