Socio-economic assessment of wind power—lessons from Denmark

This article summarizes the results from a study on the social assessment of wind power in Denmark. Using the cost effectiveness paradigm we compare the production costs of wind power to reference figures for central power production based on coal and natural gas. To the internal production costs we add the external production costs which arise from the emissions of CO 2, SO 2 and NO x from combustion of fossil fuel, and from noise and visual effects from wind mills. Further, we look at the macro-economic effects on employment and the balance of payments from investing in a 1000 MW wind power development which is about double the total capacity of the present Danish level. Taking into account the Danish obligation of reducing CO 2 emissions by 20% in 2005 compared to 1988, the main result of our investigations is that the environmental benefits of wind power are so significant that from a socio-economic point of view wind power and natural gas power are equal. Having a coal-fired power plant as the reference technology, wind power is more advantageous.