The Case of Municipal Decision Making and Wind Power Development in Sweden
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Democratic principles and the energy transition The case of municipal decision making and wind power development in Sweden By: Sania Valivand Supervisor: Mats Nilsson Södertörn University | Department of Economics Master’s dissertation 30 credits Economics | Spring semester 2021 (Economics Master´s Programme 120 credits) Abstract The purpose of this study is to empirically investigate if the municipal decision on wind power development can be explained by a model including socioeconomic variables and proxies for the natural environment, using a pooled cross-section data set for Swedish municipalities for the period 2010-2019. The study poses the question whether politicians' decisions-making can be explained by socioeconomic factors. In order to analyse the approving or denying of wind power development in Swedish municipalities, three models are used: the linear probability model, the probit and the logit model. The results show that the Green political party (positively affecting wind power development) and that the unemployment rate, income, population density, protected areas and the affiliations with the Sweden Democrats (negatively affecting the approval rate), has a statistical significant effect on the permission process. Installed capacity of wind power plants seemingly have no impact. Our findings suggest that the municipal decision making is less random than the critics of the municipal veto proposes. Keywords: Municipal decision, wind power, municipal veto, environment, MB, socioeconomic variables, Swedish muncipalities, accepting wind power, deny project, Probit, Logit Acknowledgement I would like to express my special thanks of gratitude to my supervisor, Mats Nilsson, whose expertise and support was invaluable throughout this study. I could not have imagined a better advisor and mentor for my master thesis. My gratitude goes also out to Fredrik Dolff from Swedish wind power and Thomas Hallberg from Swedish wind energy, for valuable inputs and discussions. However, all views expressed, and any errors, remain with me. Finally, I would like to thank my family and friends for valuable support and comments. 1 Table of Contents 1 Introduction .............................................................................................................................................. 3 1.1 Aim of study and method .................................................................................................................. 6 1.2 Disposition ........................................................................................................................................ 7 1.3 Contribution ...................................................................................................................................... 7 2 The municipal veto................................................................................................................................... 8 3 Theoretical background . ........................................................................................................................ 10 3.1 Public choice theory ........................................................................................................................ 10 3.2 Competition among pressure groups for political influence ........................................................... 12 4 Previous studies...................................................................................................................................... 15 4.1 Wind power development and the local context ............................................................................. 15 4.2 Local decision-makers and the democratic process ........................................................................ 17 4.3 Nimby and externalities .................................................................................................................. 18 4.3 The municipal veto.......................................................................................................................... 19 5 Data ........................................................................................................................................................ 21 5.1 Veto data ......................................................................................................................................... 21 5.2 Control variables ............................................................................................................................. 22 6. Empirical models .................................................................................................................................. 26 6.1 The Linear probability model ......................................................................................................... 26 6.2 The Probit and Logit regression models ......................................................................................... 27 6.2.1 Probit model ............................................................................................................................. 27 6.2.3 Logistic model.......................................................................................................................... 30 7 Results .................................................................................................................................................... 31 7.1 Econometric models ........................................................................................................................ 31 7.2 Two case studies ............................................................................................................................. 34 7.3 Interest groups impact on the veto decision .................................................................................... 37 8 Conclusion ............................................................................................................................................. 39 References ................................................................................................................................................. 41 APPENDIX ............................................................................................................................................... 48 2 1 Introduction Just like the rest of the world, Sweden is facing challenges when it comes to converting to become a fossil-free society by 2045.1 The wind power development is often said to be a central part to reach this goal (e.g. Göteborgs-Posten, 2020). The Swedish wind power association2 (2021) reported that during 2020 a total of 4,363 wind turbines were installed with an installed capacity of 10 GW. Thus a 27.9 TWh of electricity was produced by wind power. That is roughly 20 % of domestic demand. The expansion of wind power continues at a rapid rate. In 2021, 2.9 GW is estimated to be built, and in a few years wind power is expected to be Sweden's second largest power source (Svensk Vindenergi, 2021). With growing wind power development it would not be surprising if we encounter increasing conflict when siting new projects. For example, the conservation of pristine mountain areas versus renewable and climate friendly power production. Other areas where the development of wind power conflicts with different interests are for example the Sami’s reindeer herding, where the development impacts negatively on endangered species, or when the Swedish Armed Forces find the development impeding Swedish national security interests.3 In Sweden, the approval process includes an environmental impact assessment but also the necessity of getting an approval from the local municipality, see figure 1. 1 Sweden adopted a climate policy framework in 2017.The framework consists of a climate law, climate goals and a climate policy advice. The long-term goal means that Sweden should not have any net emissions of greenhouse gases in 2045 (Naturvårdsverket, 2020) 2 Svensk Vindkraft 3 Vindval (2018) did a research that showed, where wind farms are centrally located within a grazing area, decreased the reindeer's use of the area by 57 %. Another research done by Vindval (2017) regarding wind turbines effect on different bird species, showed that some turbines kill only few birds while others can cause the deaths of up to approximately 60 birds per year. The Swedish Armed Forces used their veto in 2010 and imposed wind power bans in a radius of 40 kilometres around their airports, restrictions have been broadened which includes shooting areas and areas around weather radar stations exclude wind power (Svensk Vindenergi, 2020). 3 Figure 1 Roles and division of responsibilities regarding probation of wind power establishment. Source: Energimyndigheten (2015) Figure 1 illustrates the main actors and roles in the probation regarding wind power establishment in a municipality. Briefly, the first role means that the municipality has the opportunity to bring up standpoints about wind power establishment in the permit review, in order to keep environmental and public interests within the municipality (Energimyndigheten, 2015). This can be done at different times, such as in the case of early dialogue between the developer, the municipal representatives and the county administrative board, during the consultation with the authorities for which the developer is responsible (Energimyndigheten, 2015). Further, the construction planner/planning managers are responsible for consulting with relevant municipalities, county administrative