Local acceptance and heterogeneous externalities of biorefineries

- Acceptance of local biorefinery projects is not well measured by simple polls.
- We estimate WTPs by attitudes to the project to measure acceptance.
- Some communities with majority support for a biorefinery have net welfare loss.
- County level factors dominate the attitudes towards a biorefinery and the WTPs.
- Temperature influences the WTPs and the effect conditions the baseline attitudes.

Biofuels can potentially reduce lifecycle greenhouse gas emissions from energy use and help address the climate change problem. However, the siting and operation of a biofuel production facility can impact the members of the host community both positively (e.g. local jobs and income) and negatively (e.g. pollution and noise). Such ambivalent and heterogeneous external impacts result in either local support or opposition to the facility, which in turn becomes a key factor affecting biorefinery location decisions, and subsequent success of biorefineries. While a number of prior studies have analyzed economic and environmental impacts of biofuels, systematic analysis of local acceptability of biofuel production facilities is lacking. Our study explores factors that influence community attitudes towards biofuel facilities. We assess the strength of acceptability or opposition by estimating the local community's willingness to pay (WTP) either to support or to oppose a proposed biorefinery. We posit that such WTP estimates provide a more comprehensive measure of local acceptability. Results also suggest that county level socio-economic characteristics significantly influence these attitudes and WTP.