Pete Mills, Policy Intern at Think NC First

In 1903, the Wright Brothers chose to test their flyer in Kitty Hawk thanks to the “evenness of its wind current.” Over one hundred years later, a new venture seeks to harness the state’s wind power with similarly revolutionary potential.

Amazon announced plans in July to build a major wind farm in Perquimans and Pasquotank counties, only 50 miles from the beach that made North Carolina “First in Flight.” The sprawling 34-square-mile wind farm, called Amazon Wind Farm US East, will be the state’s first utility-scale wind energy project. The $400 million project managed by Spanish developer Iberdrola Renewables will begin generating electricity in late 2016.[1] The project will produce power exclusively for Amazon’s data centers in Virginia and Ohio.[2]

Many hurdles remain for other companies looking to follow Amazon’s lead. Previous wind farm projects have failed due to widespread opposition in tourist areas, interference with military flight paths, and the potential for bird kills in seasonal migration routes.[3] These obstacles could prevent North Carolina from leading the way on wind energy in the Southeast. But if state policymakers can clear the way for future projects, wind farms could dramatically change the economic and physical landscape of Eastern North Carolina.

In the United Kingdom, Wales has become a key region for wind energy development due to its high average wind speeds and low population density. In recent years, companies have built several wind farms throughout the Welsh countryside, with many more on the way. This new industry has had mixed economic benefits. There was a short-term boost to construction activity resulting from the on-site development, turbine installation, and employment of specialist services and sub-contractors. Local economies also benefited from the spending associated with incoming workers. Beyond this, the site communities benefited little.[4]

The major obstacle for rural communities was their inability to provide any of the essential goods or services. Due to their small labor supply and relative lack of resources, rural communities cannot become more integrated in the construction and management aspects of wind farm projects. Many companies tried to compensate for this by offering benefits to affected people. One example was by paying reparation for environmental harm or any net loss in ‘countryside capital.’ In these cases, a developer worked with the affected community to provide benefits beyond direct employment, profits, rents and royalties the wind farm project generated. Developers commonly scaled the benefit amounts based on a fixed amount relative to the size of their project. Benefits often came in the form of funding for local programs, like sports clubs, churches, primary schools, or as scholarships for local students going on to further and higher education. Other developers provided funds for sustainable energy projects, habitat management, or rural tourism, such as the development of mountain-biking trails.

While these programs generated a positive net economic benefit to affected communities, the benefit’s scope was limited. There was little evidence of the evaluation of funds and their economic outcomes, and most benefit schemes focused only on the immediately affected area, instead of joining with funds available at wider scales. In this way, community benefits programs failed to create long-term growth for regions as a whole.[5]

As North Carolina opens up opportunities for large companies like Amazon to build wind farms, policymakers should develop a strategic plan for making the most out of potential economic benefits. Regulating community benefit packages to affected communities like Perquimans and Pasquotank counties is one option, although not nearly the best one. Instead, policymakers should seize this opportunity by investing more towards vocational training that could provide local labor for future wind energy projects. If new wind energy projects can rely on local labor for construction and management, affected communities can grow alongside this new industry. Policymakers should also invest more towards advanced training on wind energy business management. This would encourage diverse and local ownership of wind farm projects, keeping capital within the state. Without these policies, it is likely that many more wind farm projects look a lot like the first one, with their collective economic benefits leaving local communities and the state as quickly as the electricity they produce.

 



[1] The News and Observer. (July 13, 2015). Amazon backs NC’s 1st large-scale wind farm. Available at http://www.newsobserver.com/news/business/article27125410.html

[2] The News and Observer. (July 14, 2015). Power produced by Amazon wind farms won’t stay in NC. Available at http://www.newsobserver.com/news/business/article27251086.html

[3] See note 1.

[4] Munday, Max; Bristow, Gill; Cowell, Richard. (January 2011). Wind farms in rural areas: How far do community benefits from wind farms represent a local economic development opportunity? Journal of Rural Studies. Available at http://eric.ed.gov/?id=EJ913167

[5] See note 1.