Death of Coal and Breath of Life: The Effect of Power Plant Closure on Local Air Quality

46 Pages Posted: 17 Nov 2020

See all articles by Jason Brown

Jason Brown

Federal Reserve Bank of Kansas City

Colton Tousey

Federal Reserve Bank of Kansas City

Date Written: October 15, 2020

Abstract

The number of U.S. coal-red power plants declined by nearly 250 between 2001 and 2018. Given that burning coal generates large amounts of particulate matter is known to have adverse health effects, closure of coal-red power plants should improve local air quality. Using spatial panel data from air quality monitor stations and coal-red power plants, we estimate the relationship between plant closure and local air quality. We find that on average, the levels of particulate matter within 25 and 50 mile buffers around air quality monitors declined between 7 and 14 percent with each closure. We estimate that the event of closure is associated with a 0.6 percent decline in local mortality probabilities. On a value of statistical life basis, the median local benefit of coal power plant closure ranged between $1 and $4 billion or 5 to 15 percent of local GDP since the early 2000s.

Keywords: air quality; coal; plant closure

JEL Classification: Q35, Q53, R11

Suggested Citation

Brown, Jason and Tousey, Colton, Death of Coal and Breath of Life: The Effect of Power Plant Closure on Local Air Quality (October 15, 2020). Federal Reserve Bank of Kansas City Working Paper, October 2020, RWP 20-15; http://doi.org/10.18651/RWP2020-15, Available at SSRN: https://ssrn.com/abstract=3729579 or http://dx.doi.org/10.2139/ssrn.3729579

Jason Brown (Contact Author)

Federal Reserve Bank of Kansas City ( email )

1 Memorial Dr.
Kansas City, MO 64198
United States

Colton Tousey

Federal Reserve Bank of Kansas City ( email )

1 Memorial Dr.
Kansas City, MO 64198
United States

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