Working Paper: CEPR ID: DP18046
Authors: Tim Besley; Azhar Hussain
Abstract: Phasing out coal-fired power in favor of renewables is now a central plank of climate action. But, in contrast to many other policy actions, coal-fired power should have an immediate and perceptible benefit through improved air quality. If this is true, there is potential to harness local politics in combating a global problem. However, this line of argument is only valid if coal-fired power does indeed lead to greater air quality dissatisfaction. This paper provides such evidence using geocoded survey data from 51 countries by demonstrating that people living within 40 km of coal-fired power stations are, on average, more dissatisfied with the ambient air quality. We then construct a willingness-to-pay measure to show that there are net benefits from replacing coal-fired power generation capacity with green technologies globally, solely based on air quality improvements.
Keywords: coal-fired power plants; air quality; clean energy transition; renewable energy; climate action; life satisfaction
JEL Codes: I31; Q42; Q53; Q58
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Proximity to coal-fired power plants (L94) | Willingness-to-pay (WTP) measure for renewable energy (Q21) |
| Proximity to coal-fired power plants (L94) | Air quality dissatisfaction (Q53) |
| Log distances from railroads and navigable water bodies (R12) | Proximity to coal-fired power plants (L94) |