The Effect of Power Plants on Local Housing Values and Rents

This 2011 peer-reviewed study by UC Berkeley economist Lucas W. Davis examined neighborhoods surrounding 92 large U.S. power plants opened between 1993 and 2000. Housing values and rents within two miles fell approximately 3%–7% compared with similar neighborhoods, with evidence of larger effects within one mile and around larger plants. Importantly, 85 of the 92 plants were natural-gas facilities, and restricting the analysis to natural-gas plants produced a roughly 7.2% decline in housing values and 4.4% decline in rents.

This study does not predict what will happen to Horse Creek property values—the plants were built more than 25 years ago, were generally 100+ MW, and local design, visibility, noise, infrastructure and housing markets will differ. It does, however, provide strong peer-reviewed evidence that opening a large power plant can negatively affect nearby housing markets, making a pre-project appraisal and independent Horse Creek-specific property-value analysis reasonable protections for homeowners.

Peer-Reviewed Academic Study