Economic Benefits, Carbon Dioxide (CO2) Emissions Reductions, and Water Conservation Benefits from 1,000 Megawatts (MW) of New Wind Power in Massachusetts

Wind power is one of the fastest-growing forms of new power generation in the United States. The nation’s total wind power generating capacity increased by 50% in 2008, and new wind power installations constituted 42% of all new electric power installations. This growth is the result of many drivers, including increased economic competitiveness and favorable state policies such as Renewable Portfolio Standards. However, new wind power installations provide more than cost-competitive electricity. Wind power brings economic development to rural regions, reduces water consumption in the electric power sector, and reduces greenhouse gas emissions by displacing fossil fuels. The U.S. Department of Energy’s Wind Powering America Program is committed to educating state-level policy makers and other stakeholders about the economic, CO2 emissions, and water conservation impacts of wind power. This analysis highlights the expected impacts of 1,000 MW of wind power in Massachusetts. Although construction and operation of 1,000 MW of wind power is a significant effort, seven states have already reached the 1,000-MW mark. We forecast the
cumulative economic benefits from 1,000 MW of development in Massachusetts to be $1.4 billion, annual CO2 reductions are estimated at 2.6 million tons, and annual water savings are 1,293 million gallons.

Economic Benefits
Building and operating 1,000 MW of wind power requires a significant investment. But this investment will generate substantial direct, indirect, and induced economic benefits for Massachusetts. Direct benefits include jobs, land-lease payments, and increased tax revenues. Indirect benefits include benefits to businesses that support the wind farm. Induced benefits result from additional spending on goods and services in the area surrounding the development. Direct impacts result from investment in the planning, development, and operation of new wind facilities. Beneficiaries include landowners, construction workers, operation and maintenance (O&M) staff, turbine manufacturers, and project managers. Indirect impacts reflect payments made to businesses that support the wind facility and include banks financing the project, component suppliers, and manufacturers of equipment used to install and maintain the facility. Induced benefits result from increased spending by direct and indirect beneficiaries. Examples include increased business to restaurants, retail establishments, and childcare providers. Drivers of economic benefits include the use of local construction companies, the presence of in-state component suppliers, local wage structures, local property tax structures, and O&M expenditures. The projected benefits for Massachusetts could be greatly increased by the development of a local wind supply, installation, and maintenance industry within the state.

CO2 Emissions and Water
Conservation Benefits In 2004, the average Massachusetts resident emitted approximately 4.5 tons of CO2 from electricity consumption. As a state, Massachusetts ranked 41st in per capita CO2 emissions from the electricity sector. CO2 emissions are increasingly important
factors as the state and federal government consider policies regarding climate change while drought in the Southeast has underscored the relevance of freshwater supply issues outside of the arid and semi-arid regions of the United States. Developing wind power in Massachusetts will result in CO2 emissions reductions and water savings. Choosing to build wind results in CO2 reductions from less natural gas consumption. In addition, both fossil- and nuclearbased electricity generation consume large amounts of water. Wind power reduces our reliance on increasingly vital freshwater resources.

Methodology
The data for economic analysis are primarily from interviews with state-specific contacts, including developers, power plant operators, contractors, mining and gas associations, and state property tax assessors or administrators. When interviews were not possible, information was obtained from public Web resources, state tax reports, and federal databases for current power plants. Cumulative impacts are estimated for construction and 20 years of operations. Economic impacts are estimated by application of NREL’s Jobs and Economic Development Impacts (JEDI) model. Carbon estimates apply 2004 non-baseload CO2 emissions rates (EPA eGRID2006 Version 2.1, April 2007). Water savings are calculated based
on consumption rates for various generating technologies. Western Resource Advocates compiled consumption rates. Consumption rate data is from EIA form 767 and EPRI publications. Rates are applied to the specific NERC region resource and prime mover mix as determined from EIA form 960/920.

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