Political Economy of Energy Based Green Economic Development

Local economic development is in transition to "green economic development." Local governments in the U.S. and other countries have adopted a variety of policy tools to promote green economic development and are appying them to to their local economies. The success of these efforts may depend on whether local officials have a systematic understanding of green development and how it is different from more conventional economic development approaches. One purpose of this study is to enhance our understanding of green development policy by advancing a theoretical framework and identifying empirical evidence to account for local green econmic development activities and policies. The most basic but essential task is to understand when and how policy tools are used. The factors influencing conventional economic development activities and green economic development activities are drawn from three explanatory approaches in the literature on urban policy and econmic development: the economic pressure model, the political/institutional choice model, and development/environmental coalition model. These explanatory models are adapted and extended to account for energy based green economic development policy including the promotion of energy efficient technology, promotion of renewable energy development, and regulatory relief targeted to energy efficincy and renewables. This investigation produces several potentially important findings. First, local decision makers' perceptions and motivations regarding the importance of green businesses and industries significantly influence the use of each of the four policy tools. Additionally, neighborhood and environmental protection organizations, which have not had much impact on conventional development, have a significant influence on green development policy. Also, a community's standard of living and collaborative activities for green development are linked to regulatory relief for energy efficient technology development by local governments. Some of the same factors that determine conventional economic development activities such as administrative capacity, economic stress, development competition, voters' preference, and support of private organizations also influence the use of green economic development policy tools. An unanticipated finding is that Florida citizens registered as members of the Democratic or Green Party in Florida are less likely to support incentives and regulatory relief for renewable energy development. This curious result may reflect factors unique to Florida or cleavages in environmental voting blocks over renewable energy. Certain renewable energy sources are controversial and are purported to generate energy sprawl and negative environmental externalities. In Florida, renewable energy policy may be associated with Republicans because incentives and regulatory relief have usually been favored tools of the Christ administration. Since 2006, the Republican Party in power has emphasized climate changes and promoted renewable energy development. This study concludes that the development incentives for local green economic development are the product of political bargainig and collective action among stakeholders, rather than a product of economic pressures or conditions. This is in stark contrast with regulatory relief for green economic development. While regulatory relief for the use of energy efficient technology is significantly influenced by economic pressure and conditions, regulatory relief for renewable energy development is substantially influenced by political choice and stakeholders' activities. Comparison of development incentives and regulatory relief also provides new insights. Incentives for energy efficient technology are influenced by political/institutional factors and stakeholders' power and roles. In contrast regulatory relief to promote energy efficient technology development is shaped more by community economic pressures and conditions. However, both incentives and regulatory relief for renewable energy development are influenced by political bargaining and the power of environmental advocacy coalitions. The conclusion urges local governments or decision makers to pay attention to the distinctions highlighted in this analysis in the design, adoption and implementation of policy tools for green economic development.