Linking Renewable Energy to Rural Development
In many OECD countries, governments have invested large amounts of public money to support renewable energy (RE) development and are requiring significant quantities of it to be sold by energy providers. But what are the economic impacts of these policies on the rural regions where deployment takes place? How can RE bring the greatest benefit to host regions? These are some of the questions explored by this study. Drawing on case studies in 16 regions within 10 countries, the research finds that while RE indeed represents an opportunity for stimulating economic growth in rural communities, its development benefits are not automatic. Realising them requires a complex and flexible policy framework and a long-term strategy, as well as a realistic appreciation of the potential gains from RE deployment. Making a positive connection between RE development and local economic growth will require more coherent strategies, the right set of local conditions, and a place-based approach to deployment.
Introduction
The OECD defines “rural” through a two-fold methodology. First of all, the OECD identifies two levels of geographic units within each member country. The higher level (Territorial level 2 [TL2]) consists of 362 larger regions while the lower level (Territorial level 3 [TL3]) is composed of 1 794 smaller regions. In most of the cases they correspond to administrative regions and TL3 are within TL2. This classification facilitates greater comparability of geographic units at the same territorial level.