Climate Change and Decarbonization: Firm-level Insights from the 2023 Annual Business Survey and Implications for Rural Communities

The transition from fossil fuels to renewable energy is perhaps the greatest sociotechnical challenge humanity has faced. Federal expenditures in 2023 supporting the transition exceed $369bn, and yet remarkably little information exists about why or how firms are transitioning to new energy forms. The much lower energy density of renewables will create new land use conflicts such as those emerging from agrovoltaics. Although studies have examined technological pathways to a low-carbon economy, research on carbon emissions reduction strategies has suffered from a paucity of data. Now, for the first time, the 2023 Annual Business Survey includes a module on firm level decarbonization efforts that allows robust analysis of the challenges. This project will make use of confidential data from the Census Bureau, Energy Information Administration, and National Center for Science and Engineering Statistics within a Federal Statistical Research Data Center to illuminate why, how, and where the low carbon economy is emerging. A central hypothesis is that rural open space confers new economic benefits in the energy transition, even as community resistance to siting green energy infrastructure is growing. A key sub-objective is investigating how firms and communities are navigating the challenges and costs of installing this new infrastructure. The research team will use state of the art econometric models to identify relationships between firm and community characteristics and green energy adoption at the establishment level, for the benefit of rural communities and businesses, and society more generally. Research team members include: Stephan Goetz, Zheng Tian, and Luyi Han (NERCRD/Penn State); Timothy Wojan (National Center for Science and Engineering Statistics, U.S. National Science Foundation); and Justin Winikoff (USDA Economic Research Service)

Funding Agency: USDA NIFA

Principal Investigator: Stephan J. Goetz

Lead Institution: NERCRD/Penn State

Accompanying Institution(s): National Center for Science and Engineering Statistics, U.S. National Science Foundation; USDA Economic Research Service

Start Date: July, 2024   End Date: June, 2027