Land concentration and large renewable energy projects

This paper documents that land ownership concentration increases the probability of hosting large green energy facilities, specifically, mega photovoltaic (PV) plants. First, we show that U.S. counties with a higher proportion of agricultural land concentrated in large farms are more likely to accommodate mega PV facilities, defined as installations exceeding 50 hectares. In particular, counties where more than 50% of agricultural land is held by large farms double the probability of hosting a mega PV plant. The effect is robust when controlling for key factors for the deployment of PV projects, such as terrain ruggedness and PV output potential. Second, we provide both qualitative and quantitative analogous evidence for Spanish municipalities. Third, we explore Spanish data in greater detail and conduct an intra-municipal analysis at the 0.5x0.5km grid-cell level, which enables us to neutralize all omitted variables that can jointly determine land concentration and the decision to locate mega PV plants. We show that grid cells located in larger register (cadastral) parcels have a much higher probability of being part of a mega PV facility. These results respond to the fact that for a company trying to develop a large PV facility, it is easier to reach an agreement to rent the required land with a large landowner than with dozens or hundreds of owners. These findings are of great relevance in order to assess the costs and benefits of such investments, in a context of growing opposition by rural communities. Our results also exemplify how a historically rooted economic factor such as land inequality plays a key role in determining the location of large renewable energy projects.