Do Wind Turbines Hurt Property Values?

SONY DSCAs I last discussed in June, during the past few years, proximate property owners have increasingly raised complaints about the siting and operation of wind turbines in Massachusetts.  This phenomenon is hardly unique to Massachusetts and has been drawing attention nationally and internationally.  Last month, two interesting developments with respect to the effects wind turbines may, or may not, have on nearby properties focused on whether wind turbines impact property values.

First, at the national level, a report from the Berkeley National Laboratory, sponsored by the U.S. Department of Energy, found no statistical evidence that home prices were affected by proximity to wind turbines.  While  consistent with earlier studies, the findings  are supported by a large sample size: data was collected from over 50,000 home sales in 27 counties in  nine states where homes were within 10 miles of 67 different wind facilities (1,198 sales were within 1 mile of a turbine and 331 were within ½ mile).  The report did not rule out the possibility that wind turbines affect property values, but strongly suggests that, if any such effects exist, they are small.

Second, at the state  level, the Massachusetts Appellate Tax Board (“ATB”) ruled against a Falmouth homeowner seeking a property tax abatement based on an argument that the proximity of her home to a wind turbine decreased the value of her property.  The ATB found that the homeowner had failed to meet her burden of showing that the wind turbine had a quantifiable effect on her property’s value.  This ruling is unlikely to have broad precedential value because it was based simply on the homeowner’s failure to present objective evidence.  (The ATB contrasted this case, where the homeowner relied on her personal experience, to a case where the owner of an apartment building had presented objective evidence that the market for their rental units decreased after a dog grooming facility opened across the street.)  However, the Berkeley National Laboratory Report suggests that the objective evidence sought by the ATB might be hard to find.

Although the apparent lack of an impact on property values from wind turbines is interesting – particularly to those inclined to view complaints about wind turbines with skepticism – it is state and local noise regulation that is likely the more significant issue for developers long-term.  Noise regulation is generally not based on impacts to property values, but rather on standards of general application.  And, as we have seen in Massachusetts, applying noise regulations to wind turbines is a complicated endeavor that can create regulatory uncertainty for wind turbine owners.  Massachusetts continues to explore issues relating to the application of noise regulations to wind turbines through an inter-agency initiative and  MassDEP’s “Wind Turbine Noise Technical Advisory Group” or “WNTAG,” which has had several meetings.  Interesting work done to date includes a summary of wind siting regulations from other jurisdictions and a preliminary summary of noise and setback standards from other jurisdictions prepared by the Massachusetts Energy Facilities Siting Board.

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