Article:

The Effect of HVTLs on Property Values: An Event Study

Author: Charles Thomas and Gerd Welke

Abstract:

We present empirical results for the effect on residential property values from the construction of high voltage transmission towers on an existing utility right of way. The event window consists of a period of two and a half years during which non-operational 500 kV towers were in place, after which they were taken down. Comparing proximate transactions within the window to those outside, relative to the same difference for distant transactions, we find a negative effect on valuation during the presence of the towers which is most significant for encumbered and abutting properties, and vanishes quickly with distance from the right of way or nearest tower. An event window that corresponds to widespread public knowledge of the pending construction leads to an insignificant effect suggesting that the price formation process was possibly ineffcient.

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