Hydropower externalities: A meta-analysis

This paper presents a meta-analysis of existing research related to the economic valuation of the external effects of hydropower. A database consisting of 81 observations derived from 29 studies valuing the non-market impacts of hydropower electricity generation is constructed with the main aim to quantify and explain the economic values for positive and negative hydropower externalities. Different meta-regression model specifications are used to test the robustness of significant determinants of non-market values, including different types of hydropower impacts. The explanatory and predictive power of the estimated models is relatively high. Whilst controlling for sample and study characteristics, we find significant evidence for public aversion towards deteriorations of landscape, vegetation and wildlife caused by hydropower projects. There is however only weak evidence of willingness to pay for mitigating these effects. The main positive externality of hydropower generation, the avoidance of greenhouse gas emission, positively influences welfare estimates when combined with the share of hydropower in national energy production. Sensitivity to scope is detected, but not linked to specific externalities or non-market valuation methods.