The effect of changes in solar and wind generation and energy demand on county-level employment and income in Colorado
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The increases in adoption of utility-scale renewable energy generation and energy efficient practices are meant to strengthen energy security and reduce carbon emissions, although the full extent of these efforts on the economy is not completely understood. The econometric model described in this paper attempts to explain the effects of an expansion in utility-scale solar and wind energy and changes in energy demand on county-level employment and income in Colorado, including in five specific industries. A fixed effects modeling approach utilizing a panel dataset containing pertinent economic and societal data ascertains the effects of new solar and wind energy sources and grid modernization on total and industry-level labor markets. In-depth county-level data is analyzed, including electricity generation for wind and solar energy. Additionally, geographic information system software is used to estimate energy demand per county. Results where significance was observed showed a positive relationship between wind generation and employment and income in various industries. Alternatively, significant results for solar generation and energy demand were much more varied across various industries. This analysis is useful in determining how labor markets are affected by technology adoption and consumption changes, which is crucial in maintaining a high degree of economic integrity. Such information aids policymakers in their decisions to support or deny the implementation of solar and wind energy and energy efficient policies that might reduce energy demand.