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The Effects of Renewable Energy Projects on Employment: Evidence from Brazil

Year: 2025

Type: article

Abstract: This paper studies the employment impacts of renewable energy projects in Brazil. Between 2006 and 2017, Brazil's solar capacity grew from 0.001 GW to 1.01 GW, and wind capacity grew from 0.23 GW to 12.4 GW. Using detailed employment information from the universe of formal workers in Brazil, we analyze how the development of renewable energy projects impacts local economies. We find that when new wind energy projects come online, the number of firms in a municipality increases by 14.84 percent and total employment in a municipality increases by 15.95 percent. Employment in occupations related to electricity, construction, and transportation increase by even more. The employment increases appear to stem from growth of existing firms and increased entry of new firms. The findings are mirrored in municipal sales tax revenue and income tax revenue. Our results are not explained by electricity grid expansions or construction of federal roads. Notably, we find larger effects in areas with high shares of informality.

Source: Journal of the Association of Environmental and Resource Economists

DOI: 10.1086/735825

Authors: Danae Hernandez-Cortes, Sophie M. Mathes

Language: English

Topic: Sustainable Development and Policies

Subfield: Management, Monitoring, Policy and Law

Field: Environmental Science

Domain: Physical Sciences

SDGs: Decent work and economic growth, Industry, innovation and infrastructure, Affordable and clean energy, Climate action

Open Access status: green

OpenAlex ID: W4408655650

FWCI: 3.961

Cites: 28

Cited by: 4

Related to: 10